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Insight Into China's Optical Fiber Industry: Growth Slows Slowdown From ZKTEL

- Jun 01, 2018 -

    There is a news frow ZKTEL. ZKTEL is a company which produce 5G products, which including 10G AOC SFP+ production; 40G AOC QSFP+ production; SFP28 SR/LR production; SFP+ SR production; QSFP28 SR4; QSFP28 LR4 and so on. The prices of ZKTEL products is very competitive. Welcome to visit our websites, connect with our customer serviece, we will provide yours best service!


    Most of the optical fiber companies' financial reports are as good as ever. The revenue of the leader Changfei exceeded 10 billion for the first time, a year-on-year increase of 28% to 10.366 billion yuan. The optical communication services of three multi-business companies, Hengtong, Fortis, and Zhongtian, are also marching toward 10 billion. At the same time, we should also see that the overall growth rate of the industry began to slow down in 2017, and the optical fiber industry has entered a stable and prosperous situation after years of rapid growth.

     

    Most optical fiber companies have slowed down from high-speed growth in previous years, and shifted to low-to-medium growth in 2017, and will maintain this momentum in 2018. On the one hand, China Mobile’s FTTx construction is in a sprint, and the demand for optical fiber is very strong. In 2017, the purchase volume exceeded 100 million core kilometers; on the other hand, the 4G construction is coming to an end, the overall capital expenditure of the industry is reduced, and the intensity of optical network construction is also certain. influences. Two kinds of roles are neutralized, and the domestic optical fiber demand is in a high state of operation.


    In 2018, the demand for China Mobile continued. The first batch of coal mining reached 110 million core kilometers, an increase of 80% year-on-year, and the number of wired broadband subscribers was almost equal to China Telecom, forcing China Telecom to increase its investment in broadband networks. The 2018 set The optical cable exceeds 50 million core kilometers. After China Unicom's "mixed reform", it also changed the shyness of the situation. The bullets were adequate. From 2019 to 2020, 5G will bring a new wave of network infrastructure construction boom. Optical fiber as the most basic product will certainly benefit. In the next three years, the market will not be bad and will continue to operate steadily.


    In fact, the slowdown in the growth of major fiber companies in 2017 is not a reduction in demand, but also because of their own supply shortages. It can be seen from the financial report that, in addition to a few companies such as Changfei and Hengtong, the production and sales volume of optical fiber cables of most enterprises has not increased significantly, and even declined, mainly due to the shortage of raw material optical fiber preforms and optical fibers. In order to ensure the supply of optical cables, operators have adjusted the rules of the coal mining and the price of coal mining has also increased for two consecutive years.


    The deeper reason is "anti-dumping." Since 2003, the Ministry of Commerce of the People's Republic of China has launched 8 anti-dumping cases on optical fibers and optical fiber preforms. It has been particularly accurate since 2015, effectively restraining low-cost dumping of optical rods and optical fibers abroad, and protecting market fair competition. However, it takes about 3 years from the construction to the mass production of the domestic light bar project. With the rapid growth of demand in 2016 and 2017, there is a clear supply and demand upside down for optical fiber and cable.


    However, some of the light bar production capacity will be released in the next few years, and some new light bar projects are also under planning and construction. According to the author's statistics, in accordance with China's planned light-bar production capacity, all production can meet the needs of the global fiber drawing. The shortage of optical fibers will be effectively eased this year. As the market matures, the situation of “overcapacity” will not be as serious as it was before 2014.

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