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An examination of Chinas mining equipment sector

first_imgChina’s mining equipment manufacturing sector has expanded rapidly in recent years due to very high domestic demand from its coal and metal mining industries. Industry revenue is expected to reach $59.0 billion in 2013, with annualised growth of 21.4% over the past five years, says IBISWorld in a new report Mining Equipment Manufacturing in China: Market Research Report. Rising demand from China’s manufacturing and energy sectors is driving growth.The mining equipment manufacturing industry in China mainly provides mine excavation equipment, underground transportation equipment and mineral washing and screening equipment to coal mines, nonferrous metal mines, ferrous metal mines, non-metallic mines and other mines. As China’s economy is heavily reliant on manufacturing and the energy sector, demand for natural resources drives the need for mining equipment, says IBISWorld.“The industry has a low concentration level with revenue spread across a large number of industry participants. The top four manufacturers – Zhengzhou Coal Mining Machinery Group, China Coal Technology & Engineering Group, Northern Heavy Industries Group, and China National Coal Mining Equipment – are expected to account for 9.4% of industry revenue in 2013,” says IBISWorld. “Firms tend to focus on particular equipment or markets, and the majority of enterprises manufacture single products or machine parts. Only some larger firms are able to manufacture a full and extensive range of mining equipment.“Although the industry concentration level is low on the whole, it is comparatively high for some of the industry’s products, with some manufacturers specialising in certain products developing rapidly. For example, market share for the top four companies in China’s hydraulic support market was estimated at 55.0% in 2010, the coal tunneller (sic) market at 79% and the coal cutter market at 71%.“In recent years, several large companies in this industry, such as China Coal Energy Co, Sany Heavy Equipment International Holdings Co, Zhengzhou Coal Mining Machinery Group and International Mining Machinery Group, have raised funds in capital markets by publicly listing in Shanghai and Hong Kong. This will help them to increase production capacity and operational funds, and therefore market share,” says IBISWorld.last_img read more