Beijing – China's chemical industry revenue growth rate dropped by 4.7%, profit growth rates fell 11.9% and operating costs kept rising in 2014 compared to 2013, according to a Ministry of Industry and Information Technology report.
Profit margins within the chemical industry were also 1% lower than general Chinese industry, the report said. It also said the industry's value-added output increased by 10.4% in 2014, reflecting a sector that is "well on the path transforming itself."
A 12.8% increase in end-product inventory for the chemical industry and the industry's cost per RMB100 ($16) main business revenue growing by RMB0.58 to RMB87.5 was also reported.
The sector is predicted to see a 7% profit increase in 2015 - to RMB470bn, the ministry said but the report also said that chemical companies' operating costs kept rising during 2014.
The ministry’s annual chemistry industry report said the chemicals sector accounted for 6.8% of the country's total industrial value-added output in 2014. It is also showing steady production growth and export momentum, the report said, but there is a slowdown in revenue and investment growth.
Overall, chemistry industry profit grew 0.33% to RMB431bn in 2014 compared to 2013. Revenue rose by 8.2% to RMB8.8tn.
In 2014, the value of export jumped 11% - compared to 2013 - to $162.1bn, while the value of import rose 0.6% to $186.5bn, with organic chemical feedstock and composite materials accounting for over two thirds of that figure.
Fixed asset investment within the industry rose 10.5% to RMB1.6tn in 2014, but that growth rate was slower than a 27.9% rate in 2012 and a 14.6% rate in 2013.
The ministry said 10,714 projects broke ground in 2014, up 2.5% on 2013 and organic chemical feedstock maintained a high growth rate at 18.4% compared to 2013.
Progress was made in energy saving during the first three quarters of 2014, with coal consumption per RMB10,000 revenue reduced by 3.6% to 421kg.
China's recent strategies, such as the New Silk Road Economic Belt linking China with Europe through Central and Western Asia, and the Silk Road linking China with Southeast Asian countries, Africa and Europe, are expected to bring new growth points.
The report also proposed a number of guidelines such as optimising the location of high-risk chemicals such as MDI and increasing the application of waterborne coatings and PU insulation material in green buildings.
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