Chinese machinery production to rebound

This year, machinery production in China is forecast to rebound 11 per cent to $426bn after suffering from overcapacity in 2012 that limited industry growth, according to a new report from IMS Research.

Apr 8th, 2013
Chinese machinery production to rebound
Chinese machinery production to rebound

This year, machinery production in China is forecast to rebound 11 per cent to $426bn after suffering from overcapacity in 2012 that limited industry growth, according to a new report fromIMS Research (Wellingborough, UK), now part of IHS.

That could be welcome news for vision systems vendors, since many vision systems are embedded in machinery targeted at the electronics, food and beverage and packaging markets.

The projected growth in 2013 is encouraging, given that revenue last year grew by less than 10 per cent - the lowest rate in many years -- following the severe impact of a weak export market and a shortage in investments. Prior to the slowdown, China's machinery production had expanded by a robust 20 per cent in 2011 to $379.8bn. Economic performance was also strong in 2010 after the government's deployment of a $643bn stimulus policy in 2009.

Trouble began in the second half of 2011 because of high inflation and an overheating economy, and the central government stepped in by implementing tightening policies. Even so, other difficulties persisted, according to findings from the report entitled "The Machinery Production Yearbook – China – 2013."

"Many industries in China suffered from significant over capacity in 2012, including construction, machinery production, paper and paperboard production, and photovoltaic manufacturing to name a few," commented Jay Tang, author of the report and analyst for industrial automation at IHS. "The Chinese government will likely maintain a tightening policy in the first half of 2013, but this won't continue in the second half because of a bad export situation and the slowdown in economic growth."

China's machinery relies heavily on the export market, but the weakening demand of export markets in the US and the European Union is making manufacturers pay more attention to the domestic market. Among machinery industries in China that experienced decreased activity in 2012 were those engaged in cranes, rubber and plastics, semiconductors, textiles, woodworking, and metalworking.

A few industries grew during the same time, mostly in areas related to fulfilling domestic consumption. These included agricultural machinery, electronics and electronics assembly, food, beverage and tobacco machinery, packaging machinery and industrial robotics.

Signs emerged by year-end that the Chinese economy was starting to recover after a generally tough 2012 for machine builders. However, the Chinese government is expected to remain cautious this year with any stimulus policy as the economy improves, given concerns over excesses resulting from the massive stimulus during the 2009 global recession. China's economy also will likely remain constrained by limited Eurozone demand and weakness in non-state investments, IHS believes.

Related items from Vision Systems Design that you might also find of interest.

1.Sorting seeds in Mongolia

A plethora of color sorting machines from Anhui Jiexun Optoelectronic Technology (Hefei, Anhui, China) have been deployed at the Inner Mongolia Luhua Sunflower Seeds Oil Company Limited.

2.Good times in Asia?

A UK researcher made a projection this month that Asian countries -- excluding Japan -- will be the largest market for machine vision systems in 2016.

3.Guns N' Reshoring

A Michigan State University (East Lansing, MI, USA) academic has authored a new study that claims that many US firms are moving or considering moving their manufacturing operations back to domestic soil from overseas.

-- Dave Wilson, Senior Editor,Vision Systems Design

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