China Fiberglass: The Giant of the Fiberglass Industry      

China Fiberglass Co., Ltd. (China Fiberglass, SH: 600176) was founded in Beijing in 1998. With the original name of China Chemical Building Materials Co., Ltd., it was listed in Shanghai Stock Exchange in 1999, and then changed its name to China Fiberglass Co., Ltd in 2004, mainly dealing in building materials, fiberglass, waterproof, leakproof materials, and decorating and refurbishing materials.

* The principle business, fiberglass is in steady growth *   

From January to September in 2008, China Fiberglass reaped sales revenue of RMB3.24 billion from its principle business, up 44.26% over the same period of 2007; with net profit of RMB229.52 million, up 38.92% over the same period of 2007; and gross profit of the company is 35.18%.
    The company's principle business is fiberglass and related products. Its revenue from January to September of this year, which increased greatly over the same period of 2007, was mainly from new capacities. The project of alkali-free glass fiber pool kiln wiredrawing production line with an annual capacity of 140 thousand t/a which was funded for construction in Tongxiang of Zhejiang province in August 2007, and the project of alkali-free glass fiber pool kiln wiredrawing production line with an annual capacity of 40 000 t/a and key imported equipment which were funded in Chengdu of Sichuan province in August 2007 were put into production separately in March 2008 and January 2008. The project of alkali-free glass fiber pool kiln wiredrawing production line with an annual capacity of 140 thousand t/a which was funded for construction in Tongxiang in January 2008, and the project of alkali-free glass fiber pool kiln wiredrawing production line with an annual capacity of 60 000 t/a which was funded in Chengdu in January 2008 were smoothly put into production one by one in July 2008. So far, the total capacity of China Fiberglass is 880 thousand t/a. It is estimated that the overall output of fiberglass and related products in 2008 will be around 720 - 740 thousand tons.

* Future capacity expansion is speeding up *   

Jushi Group as the holding subsidiary now possesses three fiberglass production bases separately in Tongxiang of Zhenjiang province, Jiujiang of Jiangxi province, and Chengdu of Sichuan province. In 2008, the group totally put 380 thousand tons capacity into production with overall output of 880 thousand t/a so far, which is the largest production during recent years. Tongxiang has come into a production base with annual capacity of 600 thousand t/a of fiberglass. In the near future, China Fiberglass will speed up the construction of 500 thousand tons of new composite material production base in Chengdu and 300 thousand tons fiberglass production base in Jiujiang. A new production line of 160 thousand tons is planned to be set up in Jiujiang base by the second half of 2009. Another new fiberglass production line of 160 thousand t/a will be set up by end of 2009 or beginning of 2010. Meanwhile the expired ceramic kiln of 80 thousand t/a will be washed out. It is planned that the overall fiberglass capacity will be 1.5 million t/a or so by 2012.

* China Fiberglass takes prominent competitive advantages *   

As the input-output ratio of fiberglass is low, the industry must expand its scale to gain benefit. Fiberglass is an industry with high centralization, taking on competitive structure of monopolization with the following six main global customers, according to statistics of China Fiberglass, taking up 70% of the output: Jushi Group Co., Ltd. of China, Owens Corning of USA, PPG Fiber Glass of USA, Johns Manivel, Yunnan Yuntianhua Company's subsidiary Chongqing Polycomp International Corp., and Taishan Fiberglass Inc of China. The fiberglass industry in China has comparative advantages of natural resources and low labor cost, and the world's largest fiberglass producers like America, France, and Japan are slowing the expansion of domestic fiberglass production, so the expansion of capacity is shifting to China gradually, and the three state-funded fiberglass corporations above have their own expansion plans.
    Compared with international and domestic competitors, China Fiberglass has many advantages as follows. Overall capacity is currently 880 thousand t/a, the capacity of every single production line is 140 thousand t/a, which ranks top in the world. The scale has led to a lower unit output depreciation cost. Zhejiang and Fujian provinces have 80% of the pyrophyllite resources in China. China Fiberglass currently possesses a mine with 5 million tons reserves, which guarantees the supply of pyrophyllite for 15 future years and greatly economizes the cost of raw materials. The per capita output of China Fiberglass is 100 t/a or so, higher than the international level of 60 t/a, and its labor cost takes up only 6%-8% of the productions cost, much lower than foreign countries' ratio of 25%. Via the technology of pure oxy combustion, the energy consumption of the company's fiberglass is only 900 kcal./kilo, lower than international average of 1200 kcal./kilo. The products of China Fiberglass have strong brand recognition in foreign countries, with sole agents in six countries, which are dealing 90% in direct sales.

China Fiberglass attaches much importance to overseas marketing development, and plans to build factories in foreign countries. With the future expansion of capacity and the increasing demand of downstream end-users, China Fiberglass, with its advantages of scale, technology, sales network, aims to be a giant of fiberglass industry.