According to the plans of relevant national departments, China will achieve national networking in 2010. By then, the three major power grid structures will be initially formed, and a 500kV transmission line will be built up to 6,900 kilometers. Wang Yonggan said that in the next three years, China's new installed power generation capacity will reach 70 million kilowatts each year, and the annual investment scale will reach 350 billion yuan. However, electric power investment projects must have 20% capital. At present, the domestic power grid lacks capital. In the past, it relied on discounted fees, and now it totally relied on its own funds. In the future, it will need to increase investment.
With the transformation of power grids in the United States and Europe and the acceleration of power construction in India, the demand for cold-rolled oriented silicon steel sheets has greatly increased, and the Japanese market has reduced the proportion of exports. As a result, the output of cold-rolled oriented silicon steel sheets has been greatly reduced internationally. The import volume of rolled oriented silicon steel sheet declined for a while and increased. As the main raw material for producing transformers, cold-rolled oriented silicon steel sheet is facing a crisis of global shortage. In China, only Wuhan Iron and Steel Company produces cold-rolled oriented silicon steel sheet for transformers, and Wuhan Steel has an annual output of only 150,000 tons. The demand is 600,000 tons, and it is highly dependent on imports.
Among the raw materials required for transformer production, mainly include oriented silicon steel sheets, insulation materials, transformer oil, electromagnetic wires, etc. Data show that since 2004, the prices of raw materials for transformers such as copper foil, electromagnetic wires, transformer oil, and insulation materials have increased significantly at 100%, 50%, 20%, and 10%, respectively. In particular, the price of oriented silicon steel sheets has soared from 14,000 yuan / ton to 42,000 yuan / ton by March 2005. Copper foil skyrocketed from 18,000 yuan / ton to 28,000 yuan / ton.
Against the background of the price reductions of various steel products, the prices of oriented silicon steel sheets have instead increased by 2,000 yuan / ton, and the possibility of further price increases is not ruled out. All indications indicate that the rising trend of domestic oriented silicon steel sheet prices in the second half of 2005 has not changed. The transformer manufacturing industry itself is characterized by a relatively long delivery cycle, generally 3 to 6 months, and even longer than 1 year.
The production task of another domestic transformer manufacturer is also very saturated. However, the prices of the products in the contract were calculated based on the prices of the raw materials at that time. Most manufacturers did not expect that the prices of raw materials would rise so rapidly. Therefore, its performance is not fully reflected.