Posted on 07 Feb 2022
Work on around 73% of the 14,890 construction projects across China including both property and infrastructure projects surveyed by Mysteel over January 24-25 has been suspended ahead of the Chinese New Year (CNY) holiday celebrations in early February, the latest survey showed. Construction is by far the largest consumer of steel products in China, accounting for over 60% of the country's total steel usage.
In terms of regions, in Northwest and North China - where the bulk of the country's steel is produced - over 90% of the construction projects were suspended, the survey found. In Central and Southwest China, around 80% of the projects had stopped, while in South China, the percentage was 71% and in East China, 59%.
This year, CNY officially spans January 31-February 6 but building contractors usually observe longer holidays to allow migrant workers to spend more time with their families during the holidays. For most migrant workers, CNY is the only opportunity for families to get together each year, Mysteel Global notes.
Last CNY, the central government persuaded people to stay where they were for holiday celebrations, due to the resurgence of COVID-19 cases in many parts of the country, as reported.
This year, however, many migrant workers have chosen to travel home, despite the risks of being quarantined as part of COVID prevention measures being taken by local governments. New cases of the virus continue to be reported daily in North China's Beijing, Tianjin municipality and Hebei province, and in East China's Shanghai and Zhejiang provinces, Mysteel Global notes.
This year, Mysteel's survey found that construction work on only around 11% of projects will continue uninterrupted over the CNY period, compared with 30% still on the job during last CNY.
As for the resumption of projects after the CNY holiday, Mysteel's survey showed around 35% of the sampled construction companies planned to resume work on their projects by mid-February, and around 31% in late February. The rest claimed they would not resume building work until March, or had said the timing remained undecided.
Usually in China, construction activities resume after the 'Lantern Festival' holiday, which is the 15th of the first lunar month or February 15 this year. However, many factors are creating uncertainties about the resumption of construction projects next spring, market sources noted.
"In North China, the resumption of work on many construction projects might be delayed due to a series of major events in the region including the Winter Olympic Games (in February) and the Paralympics (In March) as well as the Two Sessions meetings," a Shanghai-based analyst observed.
The Winter Olympics and Paralympics will be held in and around Beijing over February 4-20 and March 4-13 respectively, while the so-called "Two Sessions" meetings - the top annual political meetings of the country - will convene on March 4 and 5 respectively in Beijing, Mysteel Global notes.
Besides, "the cash constraints that many domestic construction projects are still suffering, as well as uncertainties about the behavior of the pandemic inside China, may also hinder the normal resumption of work," he added.
Source:Mysteel Global
