Analysis: Overview of Production and Sales of Fasteners in Taiwan in 2010

Taiwan fasteners main export area overview

The United States market. With the strong economic recovery of emerging economies, the recovery of consumer demand, the depreciation of the US dollar driving the growth of exports, and the implementation of the US government’s tax reduction policy, the US economy will likely experience further recovery. At present, the fastener import market in the United States is gradually picking up. In 2010, the amount of fasteners imported from the United States increased by 38% from 2009; thanks to the increase in the number of fasteners imported from the United States, the amount of fasteners exported from Taiwan to the United States in 2010 was 35% higher than in 2009, but with Compared to 2008, it still decreased by 17%.

EU market. As the euro zone’s sovereign debt crisis has not been lifted, the euro’s exchange rate continues to be weak and the euro zone’s products are quite competitive in the global market. In addition, with the steady growth of the economy in emerging economies, the country’s demand for capital goods and durable goods in the euro zone is particularly strong, making the euro zone’s exports continue to rise and the economic outlook is relatively optimistic. In addition, due to the EU's high anti-dumping duties imposed on fasteners in mainland China, the amount of fasteners exported from Taiwan to the EU in 2010 was 63% higher than in 2009, a year-on-year increase of 29% compared with 2008 before the financial turmoil.

The average unit price. In 2010, the average unit price of fasteners exported from Taiwan to the United States was NT$72/kg, which was slightly lower than NT$72.7/kg in 2008; the average unit price of fasteners exported to the EU was NT$75.4. / Kg, lower than the NT$ 84/kg in 2008. However, the average unit price of Taiwan’s exports to Europe and the United States is currently growing.

Taiwan's fastener industry is currently facing problems

(a) South Korea and the EU negotiate on free trade agreements

The annual output of Korean fasteners is 760,000 metric tons. The demand for fasteners is mainly from the needs of various domestic industries in Korea, such as the automotive industry. In recent years, South Korea’s annual export of fasteners has remained at 150,000 metric tons. Major exporting countries are the United States (37%), China (15%), Japan (9%), Canada (4%) and the Philippines (3%). And other countries. In 2009, the EU imported only 17,000 metric tons of fasteners from South Korea, while the amount of fasteners imported from Taiwan reached 236,000 metric tons, a certain distance. The EU mainly imports carbon steel self-tapping screws, carbon steel screws up to 6mm, stainless steel and carbon steel hexagonal screws, and stainless steel nuts from South Korea. Among them, the number of stainless steel hex screws imported from South Korea is higher than that imported from Taiwan. In addition, from the point of view of tariff rates, although the EU’s import of aluminum fastener products and copper nail products from Taiwan and South Korea accounted for less than 1% of the total imports, the tax rates for the two products are numerous. The highest of the products was 6% and 4% respectively. However, the import tariff on products made of steel screws and nuts (customs code: 7318) was 3.7%, and the import duty on copper screw products (customs code: 7415, except brass nails) was 3%. Because the average tax rate is not high, the FTA signed by South Korea and Europe has a limited impact on the export of Taiwan fasteners.

It is the fact that the EU and India are conducting free trade negotiations that need our attention. According to relevant data, the amount of fasteners imported by the European Union from India has continued to grow in recent years. In 2009, the import volume was 53,000 metric tons, which was the third largest fastener importer in the European Union, second only to China and Taiwan. The main imported products are stainless steel screws and nuts. Because, in the future, Taiwan's fastener industry should pay close attention to the continuous improvement of the competitiveness of Indian products.

(b) In 2010, the amount of fasteners exported to the European Union in mainland China increased by approximately 30%.

From 2007 to 2008, the amount of fasteners exported to the European Union in mainland China remained above 1 million metric tons. In 2009, due to the EU's high anti-dumping tariffs imposed on Chinese fastener companies, the export volume declined sharply, only 34%. Million tonnes. However, in 2010, exports rose again to 440,000 metric tons, a year-on-year increase of approximately 30%. How will the China-EU fastener dispute case develop in the future is worth our attention.

(III) Cross-strait signature of ECFA

Future development trend of fastener industry

(A) Thanks to the steady recovery of the global economy, and the continuous increase in vehicle output, fixed asset investment, and demand for durable goods, the global fastener demand in 2014 is expected to reach US$80.5 billion.

(b) The technological gap between mainland China and developed countries will further shrink. Foreign-funded enterprises will continue to set up factories in China to better utilize China's advantages in low production costs. In addition, the production of high-end fasteners in the United States, Japan, Western Europe and other developed countries and regions will continue to maintain its leading position. However, with the growth of China's economy, the increase of capital investment by manufacturers, and the continuous enrichment of manufacturing experience, the technological gap between China and these developed countries is gradually narrowing.

(C) Automobiles are the industries in which fasteners are used most. However, with the continuous rise of oil prices, small cars have become the future development trend. In addition, the development trend toward modularity in automobile production will also reduce the use of fasteners in automobiles.

(4) In 2010, China's automobile production was 18.26 million, which was a 32% increase over the previous year, accounting for 23.5% of the total automobile production in the world that year, and it maintained its position as the largest automobile manufacturing country for the second consecutive year. China's auto market development potential and business opportunities can not be ignored.

(6) The development of gluing technology and the reduction in the use of fasteners will delay the development of the fastener industry.

(7) The rising cost of raw materials and the competition of the products of developing countries will be one of the major factors affecting the profitability of the fastener industry.

Table 1: Overview of Supply and Demand of Fastener Industry in Taiwan from 2007 to 2010

Unit: NT$100 million, 10,000 metric tons, unit price (NTD/kg)

At present, the import volume of fasteners in mainland China continues to increase. In 2010, the import volume reached 270,000 metric tons, which was US$2.94 billion, a record high. In 2010, China's top five fastener importing countries and regions were Japan (37%), Germany (15%), South Korea (9%), United States (9%), and Taiwan (7%), and the average import unit price was 10.7. USD/kg, 9.6 USD/kg, 6.5 USD/kg, 26.9 USD/kg, and 7.1 USD/kg.

On January 1, 2011, the Early Harvest Plan of the Cross-Strait Economic Cooperation Framework Agreement (ECFA) was formally implemented. According to ECFA, starting from the same day, in terms of trade in goods, mainland China will impose tax cuts on 539 products originating in Taiwan, and Taiwan will impose tax cuts on 267 products originating in the mainland of the motherland and achieve zero within three years. tariff. This is undoubtedly a big plus for the increasingly close economic and trade exchanges between the two sides of the strait.

At present, the import tariff on fasteners in mainland China is 10%, and the import tariff on Taiwan is 5%. In the future, if fastener products such as screws are not included in the plan, Taiwan's fastener products will be able to enter the Chinese mainland market at a low tax rate. Compared with other countries, Taiwan’s fastener exports to mainland China will have greater advantages. , may be able to replace Japan, South Korea and other products into the Chinese market.