The total investment is over 5 trillion! The construction of 770000 kilometers of urban pipeline network has poured "cold water" on the cement industry.

On September 18, at a press conference held by the State New Office, Zhang Qiang, Director-General of the Urban Administration and Supervision Bureau of the Ministry of Housing and Construction, said that during the 15th Five-Year Plan period, China will build and renovate about 770000 km of urban underground pipeline network, with an estimated investment of more than 5 trillion yuan. As soon as the

news came out, many voices regarded 5 trillion yuan as an important factor to boost cement demand, but this "big gift" to the cement industry, I am afraid to put a question mark .

In fact, the total amount

of "shrinking" pipeline network transformation first looks at a group of the most intuitive comparison: according to the Ministry of Housing and Construction data, during the "14th Five-Year Plan" period, the national construction and transformation of urban underground pipeline network is about 1 million km; The 770000 kilometers planned in the 15th Five-Year Plan are directly reduced by 230000 kilometers, with a shrinkage of about 23% .

In addition, the nature of this round of pipeline network construction is stock repair, not incremental expansion. The transformation of urban underground pipeline network is also the maintenance account owed in the past decades, which makes up for the shortcomings of water supply, drainage, gas and heating projects, and does not create new urban space and new application scenarios. This is in line with the overall logic of the "15th Five-Year Plan" urban renewal from large-scale demolition and construction to fine governance-the focus of infrastructure investment is shifting from "paving new stalls" to "making up old accounts".

From the density of cement consumption, the transformation of pipeline network is naturally low.

The 770,000 kilometers still need to be taken apart: about 200,000 kilometers of gas are mainly steel pipes and polyethylene pipes, and about 120,000 kilometers of heat supply are mostly thermal insulation steel pipes, which basically do not consume cement; about 450,000 kilometers of concrete pipes and on-site pouring are mainly drainage, water supply and sewage, which is less than 60% of the total. Moreover, the on-site pouring is concentrated on the trench cushion, inspection wells and pavement restoration, and the cement consumption per kilometer is far from comparable to that of linear projects such as expressways and high-speed rail. The trend of declining

demand is hard to change. The elimination competition of the cement industry has sounded the battle

drum to bring the attention back to the industry as a whole: the trend of deep adjustment of real estate remains unchanged, the imagination space of infrastructure hedging is narrowing, and the trend of declining demand for cement will continue from urban renewal to pipeline network transformation. Under the double pressure of demand contraction and serious overcapacity, it is almost inevitable that the industry will face a elimination-cost control, location layout, compliance production and capital strength, which will become the threshold to decide who will stay and who will exit.

For a considerable number of enterprises, the problem is no longer "whether they can get through it", but "how to retreat"-whether to withdraw actively and orderly, or passively and tragically. The liquidation of the industry will not slow down because of a plan, but will accelerate as the bottom of demand approaches.

Instead of expecting the next big project to catch the demand, it is better to face the reality of capacity clearance: the elimination competition has begun, the active clearance is decent, and the passive clearance is tragic.