It is estimated that by 2025, the scale of China's prefabricated steel structure building market will reach 753.3 billion yuan

Encouraging the development of prefabricated buildings has become one of the important construction industry policies in the mainland at this stage. Since the issuance of the "Guiding Opinions on Vigorously Developing Prefabricated Buildings" (Guo Ban Fa [2016] No. 71) in 2016, under the situation that the scale of the construction industry in mainland China has reached a new high, a large number of policy documents related to prefabricated buildings have been released, various standards have been gradually improved, development indicators have become clearer and the requirements are getting higher and higher, and the country has shown a high-speed development trend that goes hand in hand, and key development areas have taken the lead in entering the stage of high-quality and green and low-carbon development.

1. The prefabricated building industry is an important development direction of the country in the field of construction

Prefabricated building refers to a building in which prefabricated components and accessories are transported to the construction site in the factory and assembled and installed on site through reliable connections. Compared with the traditional cast-in-place construction, the construction site of the prefabricated building does not require a lot of manpower and material resources, and most of the building components and components are completed in the production workshop, which reduces the loss of building materials and the generation of construction waste, and reduces the carbon emissions in the entire building life cycle. From the classification of structural materials, prefabricated buildings can be roughly divided into prefabricated concrete buildings, prefabricated steel structure buildings, and prefabricated wood structure buildings.

Because of its high-efficiency, energy-saving, environmental protection and low-carbon characteristics, prefabricated buildings have been widely promoted and supported around the world. The specific advantages are as follows:

It is estimated that by 2025, the scale of China's prefabricated steel structure building market will reach 753.3 billion yuan

Therefore, whether from the perspective of economic benefits or social benefits, prefabricated buildings are regarded as one of the important paths for the transformation and upgrading of the construction industry, and have a positive effect on the realization of the national "double carbon" goal.

2. Overview of the overall development of the industry

Encouraging the development of prefabricated buildings has become one of the important construction industry policies in the mainland at this stage. Since the "Guiding Opinions on Vigorously Developing Prefabricated Buildings" (Guo Ban Fa [2016] No. 71), under the situation that the scale of the construction industry in mainland China has reached a new high, a large number of policy documents related to prefabricated buildings have been released, various standards have been gradually improved, the development indicators have become clearer and the requirements are getting higher and higher, and the country has shown a high-speed development trend that goes hand in hand, and the key development areas have taken the lead in entering the stage of high-quality and green and low-carbon development.

From the perspective of the popularity of prefabricated buildings, foreign countries started earlier in prefabricated buildings, and the penetration rate of prefabricated buildings in developed countries such as the United States, Japan, and Europe has reached more than 70%, while domestic prefabricated buildings have just started. In 2022, the newly started prefabricated buildings in the country will reach 810 million square meters, an increase of 9.5% over 2021, accounting for 26.2% of the new construction area, and there is sufficient room for the future penetration rate to rise.

2017-2022 National Newly Started Prefabricated Construction Area (100 million square meters)

In recent years, there have been frequent policies for prefabricated buildings, and the development goals are clear. Relevant policies revolve around the promotion of green buildings and the acceleration of the process of building industrialization, and repeatedly propose to vigorously develop prefabricated buildings.

At present, concrete structure and steel structure are the main structural types of prefabricated buildings in mainland China. According to the application field, it can be divided into bridge steel structure, modular building products and building steel structure, all of which belong to the field of steel structure prefabricated building. As one of the important supporting materials for prefabricated buildings, steel structure has many advantages such as high strength, light weight, good seismic performance, large space utilization, high degree of industrialization, short construction period, low construction cost, high economic benefits, strong plasticity, wide application fields and recyclability.

In terms of the penetration rate of prefabricated steel structure buildings, the penetration rate of prefabricated steel structure buildings in mainland China increased from 4.1% to 6.9% from 2019 to 2021, and is expected to rise to 40.0% by 2035, with a compound annual growth rate of about 15.30%. The market penetration rate of prefabricated steel structure buildings in China is getting higher and higher.

2019-2035 China prefabricated steel structure building penetration rate and forecast

In 2021, the size of China's prefabricated steel structure building market will be about 570.3 billion yuan, and under the background of the increasing emphasis on green building in mainland China, China's prefabricated steel structure building industry is developing rapidly, and it is expected that the market size of China's prefabricated steel structure building will develop to 753.3 billion yuan by 2025, with a compound annual growth rate of about 12.70% from 2020 to 2025.

2020-2025 China prefabricated steel structure building market size and forecast (100 million yuan)

3. Characteristics of the technical level of the industry

In recent years, the mainland steel structure industry has shown a strong momentum of development in technological innovation and industrial upgrading. With the in-depth promotion of the country's construction industrialization, green building and sustainable development strategy, the prefabricated steel structure, as an important carrier of the modernization of the construction industry, has been comprehensively developed and optimized its technical system.

To sum up, the overall technical level of the mainland steel structure industry has been significantly improved, and the application of prefabricated steel structure buildings in many fields such as residential, public facilities, and industrial buildings is becoming more and more extensive, reflecting the determination and effectiveness of the transformation of the mainland construction industry to high quality, high efficiency and sustainable direction.

4. The cyclical, regional and seasonal characteristics of the industry

(1) The cyclical characteristics of the industry

The downstream application fields of the steel structure products industry are usually fixed assets such as bridges, buildings, and plants, which are comprehensively affected by factors such as macroeconomy, domestic industrial chain structure adjustment, and urbanization process. In this case, the economic situation and industrial policies of the mainland will directly affect the investment of the state and private enterprises in fixed assets such as bridges and buildings, thereby affecting the demand for steel structure products. The steel structure industry is more related to the investment in fixed assets of the whole society, and the main driving force for the development of the industry is economic development and related policies. The cyclical fluctuations of the national economy, as well as the comprehensive impact of national policies, make the steel structure industry also show certain cyclical characteristics.

(2) Regional characteristics of the industry

In the steel structure industry, local economic construction will affect the government, private enterprises on steel structure bridges, buildings and other fixed assets investment, economic construction developed areas for steel structure products demand is relatively higher. Therefore, the demand for steel structure products in the Yangtze River Delta and Pearl River Delta regions of the mainland is high. In addition, the steel structure also has the characteristics of large components, heavy weight and high transportation costs, and there is a large amount of transportation work from the manufacturing workshop to the installation site, so the steel structure manufacturing generally has a coverage radius of 500~800 kilometers, reflecting certain regional attributes.

(3) Seasonal characteristics of the industry

Steel structure downstream industry is mainly for construction, road traffic construction and other industries, in general, due to the winter low temperature affecting construction and holidays and other reasons, construction, road traffic and other industries in the first quarter of the business is relatively small, which leads to the upstream steel structure industry procurement demand decline in the same period, steel structure industry in most areas showing the first quarter for the off-season, second, third and fourth quarters for the seasonal characteristics of the relative peak season, especially in the second half of the year is significantly better than the first half of the year.

In addition, some downstream customers such as large central enterprises, state-owned enterprises or governments have the stage of enterprise budget, final accounts and task plan formulation at the beginning of each year, and the issuance of task plans and bidding activities are generally concentrated in the second quarter. After the project is awarded, the project installation work is mainly concentrated in the third and fourth quarters, especially in the fourth quarter, which usually catches up with the construction period. As a result, there is a clear seasonal character in the industry.

For more industry information, please refer to the "2024-2030 Prefabricated Building Industry Market Research and Development Trend Forecast Report" of PwC Consulting, and PwC Consulting also provides special market research projects, industrial research reports, industrial chain consulting, project feasibility study reports, specialized and special new small giant certification, market share reports, 15th Five-Year Plan, post-project evaluation reports, BP business plans, industrial maps, industrial planning, blue white papers, national manufacturing single champion enterprise certification, IPO fundraising feasibility study, IPO working paper consulting and other services. （PHPOLICY:MJ）

It is estimated that by 2025, the scale of China's prefabricated steel structure building market will reach 753.3 billion yuan

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