Advantages of Developing Electric Porcelain Industry in Luxi County, Jiangxi Province

2.1 Having a Good Industrial Foundation

Since the beginning of the last century, Luxi has been producing and selling electric porcelain. The Pingxiang Electric Porcelain Factory located in Shangbu Town was once the sixth largest electric porcelain factory in China. In the late 1990s, a dense production area of electric porcelain was formed with Luxi Town, Shangbu Town, and Nankeng Town as the core. At present, there are 59 electric porcelain enterprises in the county, including 28 large-scale enterprises with annual sales of over 20 million yuan and 26300 employees. In 2006, the total output value of the electric porcelain industry was 665 million yuan, achieving nearly 200 million yuan in profits and taxes, and an additional investment of 21 million yuan; In 2007, the total output value of the electric porcelain industry reached 1.42 billion yuan, achieving profits and taxes of 426 million yuan, and an additional investment of 87 million yuan, an increase of 116%, 113%, and 314% respectively compared to 2006; From January to June 2008, the total output value of the electric porcelain industry reached 1.05 billion yuan, achieving profits and taxes of 315 million yuan, and an additional investment of 195 million yuan. The regional advantages of the electric porcelain industry in Luxi County are obvious. In the past three years, the average growth rate of the electric porcelain industry output value has been over 60%, and the profit and tax rate has reached 30%. The economic benefits are significant, and it has become one of the characteristic and pillar industries of Luxi County.

2.2 Having Good Resource Advantages

Pingxiang has the main mineral resources for producing electric porcelain. There are abundant mineral resources such as kaolin, quartz, and feldspar in Pingxiang and surrounding areas. The mines have large reserves and high quality, which can basically meet the raw material demand for electric porcelain production. The basic energy required for firing high-grade electric porcelain - natural gas - has also been introduced, laying a good foundation for clean production in the industry.

2.3 Possess certain technological and technical advantages

In the nearly 100 year history of electric porcelain production, Pingxiang's electric porcelain production process has been continuously improving, equipment level and personnel quality have been continuously improving, accumulating rich experience in electric porcelain production, cultivating a large number of engineering and technical personnel and operators with practical experience, and forming a certain technical advantage. We are now able to mass-produce electric porcelain products with strength levels of 160kN and below, including suspension porcelain insulators, mid range pillar porcelain insulators, and hollow porcelain insulators. Some of our products have been exported to Southeast Asia and European and American countries. Jiangxi Qianglian Electric Porcelain Co., Ltd., which has recently been put into operation, adopts dry isostatic pressing technology to produce high-strength rod shaped pillar products. The technological level and product quality have reached the advanced level of similar products in China. More importantly, there are many manual operations in the electric porcelain manufacturing industry, and the operational skills of employees have a significant impact on product quality. The Pingxiang area has a unique resource of skilled operators.

Some electric porcelain production enterprises have also established good cooperative relationships with authoritative domestic electric porcelain research institutions such as Hunan University and Xi'an Electric Porcelain Research Institute. Through industry university research cooperation, the independent innovation ability of the enterprises has been improved, and some of the achievements have been transformed into productivity, promoting the technological progress of the Pingxiang electric porcelain industry.

2.4 Good social and economic benefits

(1) High level of industry profits and taxes

Compared with daily ceramics and architectural ceramics, as long as the product's entire process qualification rate reaches the forefront level in China, the electric porcelain industry has a large appreciation space for raw materials after production and processing, high industrial added value, and high profit and tax levels. According to the calculation of the average tax burden of 87 industrial manufacturing and production industries by the National Taxation Bureau, the average tax burden of the insulator and lightning arrester industry is among the top, about 8%. Calculated based on an investment intensity of 1 million yuan/mu, the tax revenue per unit area reaches over 100000 yuan/mu.

(2) Can provide more job opportunities

On the one hand, the electric porcelain industry has a high added value of products, and on the other hand, due to its diverse production processes and product types, it is difficult to achieve mechanized and automated production, requiring a large number of employees. According to statistics, the per capita industrial added value of the electric porcelain industry is 60000 to 100000 yuan/year? Is the per capita added value of people and the steel industry 300000 yuan/year? Compared to people, in order to achieve the same industrial added value, the required employment personnel are 3-5 times that of the steel industry.

(3) Easy to form industrial clusters and chains

A key factor in the sustainable development of the industrial economy is the formation of industrial clusters and chains. Electric porcelain is a fundamental industry supporting power transmission and transformation projects. Whether it is hydropower, thermal power, wind power, or solar power generation, as long as there is power transmission, electric porcelain is indispensable. Therefore, electric porcelain has a continuous and growing market demand and will always be a sunrise industry. The industry chain of electric porcelain is long, and in addition to the manufacturing of porcelain parts, a large number of metal accessories are also required, such as iron caps, steel feet, connecting flanges, etc. Electric porcelain is also a key component of many electrical products, such as the external insulation and container for various capacitors, transformers, and circuit breakers. Therefore, the downstream product of the electric porcelain industry, electrical appliances, is a high value-added field with great development potential. It should be focused on developing as a new growth point in the electric porcelain industry chain, and is also an important prerequisite for expanding and strengthening the electric porcelain industry.

2.5 Opportunities and challenges faced by the development of the electric porcelain industry

(1) Opportunities

According to the national power grid construction and development plan, during the 11th Five Year Plan period, the total investment of China's power grid will exceed 2 trillion yuan, including 850 billion yuan from State Grid Corporation of China, 234 billion yuan from Southern Power Grid Corporation, and approximately 1 trillion yuan from local power grids in various provinces and cities. By 2010, the ultra-high voltage transmission line had reached 4200km, with a transformer capacity of 39 million kVA and a cross regional power transmission capacity of 70 million kW. Urban and rural power grids: 220kV and above AC/DC transmission lines>340000 km, with a transformation capacity>1.3 billion kVA. The above data indicates that China's power grid construction is in a period of rapid growth, and the market demand for electric porcelain will continue to grow for a certain period of time.

Insulators and electrical equipment assembled with insulators account for about 35% of the total investment in power grid construction, with an average annual market demand of around 150 billion yuan. Among them, the domestic market demand for insulators is 12 to 15 billion yuan per year, and porcelain insulators account for 40% to 50%. Currently, the domestic market demand for porcelain insulators is 5 to 7 billion yuan. From the perspective of market segmentation, there is a large market space for electric porcelain products of 110kV to 1000kV voltage levels. However, the competition for low voltage electric porcelain products is relatively fierce due to low technology content and many manufacturers, while the high technology content of ultra-high voltage and ultra-high voltage rod shaped pillars, porcelain sleeves and other products are often in short supply due to high technical requirements and manufacturing difficulties.

In the next 20 years, China's rail transit will maintain rapid development, especially high-speed railways, light rail, and subways, which will become the focus of construction. Insulators for rail transit are also a market with great development potential that deserves attention.

Although there is still a certain gap in the manufacturing technology level of electric porcelain in China compared to developed countries, compared to the electronic information industry, electric porcelain belongs to the industry that consumes more resources and energy. With the significant increase in international energy prices, the mineral resources for producing electric porcelain are becoming less and less, and labor costs are increasing. The electric porcelain in developed countries is being transferred to China and Southeast Asian countries, which is also promoting the development of electric porcelain in China, Seizing the international market provides a great opportunity.

(2) Challenge

Most of the existing electric porcelain enterprises in Pingxiang have similar products, mainly including ceramic insulators for lines below 220kV and some low-end products with low technical content such as pillars and small porcelain sleeves. The downstream product of electric porcelain - high value-added electrical products - is almost blank, resulting in relatively low output value and profit level. The division of labor among enterprises is not clear, there is disorderly competition, there are no well-known brands and independent intellectual property rights, and the international competitiveness of existing products is not strong.

At the same time, due to the transfer of foreign capital and technology to China, such as Japan's NGK company, Italy's SEVES group company, and Europe's PPC Electric Porcelain Company, they have successively established factories in Shanghai, Tianjin, Suzhou, Tangshan, Wuxi, Zigong, and other places in China to produce porcelain insulators or tempered glass insulators. Lapp Company in the United States has also reached a cooperation agreement with Dalian Electric Porcelain Co., Ltd. for porcelain insulators, Pushing the relatively backward technology, equipment, and industrial foundation of China's electric porcelain industry to the position of competing on the same platform as the Fortune 500 enterprises is undoubtedly a severe test for China's electric porcelain industry. Faced with the challenges of international giants, we can only accelerate technological progress and enhance our ability to innovate independently, continuously improve the quality and cost-effectiveness of our products, in order to survive and develop in the fierce international competition, and make China's electric porcelain industry bigger and stronger.