China Glass Industry: Failure in Peak Seasons

Review and forecast of glass industry: cost declines and is hard to recover in short run. On output, the output of flat glass in November increased by 3% on year, but is in low level; on cost, the price of heavy oil and soda ash both decreased greatly in November month-on-month, respectively by nearly 50% and 25%; on price, as the demand and cost dropped, the price of all sort of float glass followed the fall, averagely down by 7%. Glass industry woes go on in short term.

Investment strategy of glass industry: be patient to wait for the recovery. There are three adverse factors, including the deflation of China domestic real estate industry, sliding output of autos and the global financial crisis, which restrain the market demand of glass. During 2007-2008, the over expansion of production capacity intensifies the market forces of supply and demand. The future of glass industry remains gloomy.