Time flies like a white horse flashing by; before we know it, we’ve already passed the halfway point of 2017. Various national infrastructure plans have been rolled out one after another, and major strategies—including the Belt and Road Initiative, the Beijing-Tianjin-Hebei integration, and the Yangtze River Economic Belt—are steadily advancing. As these infrastructure policies are implemented, demand for sand and gravel aggregates will increase to some extent. With infrastructure construction gaining momentum across different regions, the sand and gravel aggregate market is set to experience a significant boom.

Recently, sand and gravel aggregates have even entered a state of supply shortage, which clearly demonstrates that a large number of infrastructure projects and favorable policies have, to a certain extent, driven the development of the sand and gravel aggregate industry. Faced with such attractive infrastructure opportunities, numerous enterprises are stepping up their efforts to enhance their overall competitiveness, seizing the moment and getting ahead of the curve!

As of now, the total number of PPP projects announced or registered by departments including the National Development and Reform Commission and the Ministry of Finance has exceeded 10,000, with a total investment reaching over ten trillion yuan. With the advancement of the Belt and Road Initiative, the scale of PPP project investments could surpass 20 trillion yuan. A summary of selected infrastructure projects across China’s provinces and cities in 2017 shows that these projects are gradually starting construction one after another.

Beijing plans to invest 38.4 billion yuan in infrastructure.

Beijing is developing an urban spatial structure characterized by “one core, one primary, one secondary, two axes, multiple points, and one zone.” According to the draft plan publicly released at the end of March, Beijing’s urban spatial structure is defined as “one primary, one secondary, two axes, and multiple points,” where the “one primary” refers to the central urban area (the six central districts), the “one secondary” is the Tongzhou sub-center, the “two axes” are the Central Axis and Chang’an Avenue along with its extension, and the “multiple points” encompass the ten surrounding districts of Mentougou, Fangshan, Shunyi, Daxing, Yizhuang, Changping, Pinggu, Huairou, Miyun, and Yanqing. In 2017, Beijing planned to invest 38.4 billion yuan in infrastructure, driving forward 61 projects. In terms of rail transit, the city will prioritize the implementation of 22 projects, including Phase I of the New Airport Rail Link, the eastern extension of Line 7 Phase II, and the CBD Line, bringing the total operational mileage to over 600 kilometers. Construction will also be accelerated on expressways such as Xingyan and Yanchong, while efforts will be stepped up to complete urban expressways including the western extension of Xiwai Avenue, Yaojiayuan Road, and Lize Road. Additionally, under the Winter Olympics and Winter Paralympics facilities package, six key projects will be prioritized, including the National Speed Skating Oval, the National Alpine Skiing Center, and the Comprehensive Training Hall of the Winter Sports Center.

Hebei Invests 33.5 Billion! This Year, Hebei Province Is Advancing Construction of 17 Expressway Sections.

The Hebei Provincial Department of Transport reported that this year, Hebei Province plans to invest 33.5 billion yuan in highway construction, advancing the ongoing construction of 17 sections totaling 988 kilometers, including the Taihang Mountain Expressway. The province will ensure the completion and opening to traffic of two additional sections—Rongwu and the coastal Caofeidian branch line—totaling 64 kilometers. Meanwhile, the province aims to complete the main structures of three sections totaling 58 kilometers, including the Beijing-Qinhuangdao Expressway, and to commence construction on four sections totaling 348 kilometers, including the Tianjin-Shijiazhuang Expressway. Additionally, the province is striving to start construction on four sections totaling 172 kilometers, such as the connecting route from the Beijing-Xinjiang Expressway to the Beijing-Tibet Expressway, and to accelerate preliminary work on six sections totaling 480 kilometers, including the Langfang section of the northern expressway leading to the new airport. Hebei has launched a “Year of Transformation and Upgrading for Key Project Construction,” implementing the “337” initiative to focus on 300 provincial-level and 3,000 city-level key projects, with annual investment exceeding 700 billion yuan. The province is also speeding up transportation connectivity by prioritizing major projects such as the Beijing-Hengshui Passenger Railway, the Beijing-Tangshan Intercity Railway, and the Shijiazhuang-Jinzhou Expressway, unblocking bottlenecks on national and provincial highways, and starting construction on 300 kilometers of new expressways and adding 426 kilometers of new railway operating mileage.

Shaanxi will arrange 600 provincial-level key projects.

In 2017, Shaanxi Province planned to launch 600 key provincial-level projects and complete fixed-asset investments totaling 2.27 trillion yuan for the year. Specifically, in the highway sector, construction was accelerated on 14 expressways, including the Baoji-Hanzhong and Suide-Yanchuan routes; four new expressways, such as the Heyang-Tongchuan route, were also started. Additionally, over 2,500 kilometers of new and upgraded roads—including ecological tourism highways along the Yellow River, newly built or renovated national highways, bypasses around county seats, and red tourism highways—were completed.

Guangdong will launch nine railway projects this year, with investments exceeding 120 billion yuan.

Guangdong has scheduled annual investment of 540 billion yuan for the construction of key provincial projects. The province is accelerating the development of high-speed transportation networks, major water conservancy projects, next-generation information infrastructure, environmental protection infrastructure, large-scale energy projects, and projects aimed at improving people’s livelihoods. Specifically, seven new expressway projects have been launched, with seven already completed, adding 635 kilometers of newly opened highway mileage; six new railway projects have been initiated, with four already completed, adding 103 kilometers of newly operational railway mileage. The Guangzhou-Foshan-Jiangmen-Zhuhai intercity railway, the Guangzhou Pazhou branch line, and the second phase of the Zhuhai urban area-to-Zhuhai Airport intercity railway project have a total investment of approximately 61.3 billion yuan. Additionally, six national railway projects—including the Guangzhou-Shantou Railway, renovation works related to the Guangzhou railway hub, the Shilong Container Handling Station, the Guangzhou Datian Container Central Station, the Shantou Guang’ao Port Railway, and the Maoming Bohé Port Railway—have a combined total investment of about 63.5 billion yuan.

Guangxi Accelerates Construction of Large-Scale Infrastructure Projects

The "Implementation Plan for the 2017 Infrastructure Campaign in the Xijiang Economic Belt of Guangxi" (hereinafter referred to as the "Plan") was recently issued and put into effect. Focusing on navigation facilities along the Xijiang Golden Waterway and infrastructure for industrial parks, the Plan systematically promotes the construction of eight major categories of projects, including inland waterways, highways, municipal infrastructure, and park infrastructure. This ensures that investments exceeding 80 billion yuan will be completed and that the phased objectives for these projects will be achieved. Construction of the Guiyang-Nanning passenger railway line (Guangxi section) is being accelerated; efforts are underway to commence construction of Nanning Airport's second runway and its supporting facilities... From a project perspective, there are 166 ongoing projects carried over from 2017, with a total investment of 583.5 billion yuan and an annual planned investment of 80.65 billion yuan. Several projects involving Nanning City are among these and will receive priority attention and acceleration.

Jiangxi aims to complete investments exceeding 360 billion yuan.

Jiangxi is accelerating the construction of a number of major infrastructure and industrial projects that are critical to overall development. It is prioritizing the advancement of 980 large- and medium-sized provincial projects, with a total investment of approximately 1.4 trillion yuan, and aims to complete over 360 billion yuan in annual investment. Construction has begun on the Changjinghuang Railway, and work is continuing on six other projects, including the Changji-Gan Passenger Railway. Additionally, 43 large- and medium-sized projects for upgrading national and provincial highways are being given high priority.

1,000 Key Signed Projects in Sichuan and Chongqing

Sichuan is focusing on 700 key provincial-level projects and 100 provincially prioritized projects, and is working to bring 1,000 key signed projects to fruition. Chongqing’s transportation infrastructure development plan calls for an investment of 82 billion yuan, including 28.5 billion yuan for railways, 47 billion yuan for highways, and 2.5 billion yuan for civil aviation. In 2017, the Qianjiang Airport expansion project will be completed, and construction will begin on the Wansheng Jiangnan Airport. Additionally, projects to upgrade and expand the airports in Wushan, Wulong, and Wan州 will be accelerated.

Hunan to Implement 300 Provincial-Level Major Projects

In 2017, Hunan Province implemented 300 major provincial-level projects. The province aims to complete over 300 kilometers of expressways and more than 1,000 kilometers of trunk highways. Key projects under construction include the Changyi (capacity expansion) expressway, as well as the Huai-Shao-Heng, Zhang-Ji-Huai, and Qian-Zhang-Chang railways. The Changyi-Changsha high-speed railway is expected to begin construction within the year. Preparatory work for Terminal T3 at Huanghua Airport will be accelerated, ensuring that Wugang Airport opens and begins operations. Construction of regional and general aviation airports will also be strengthened.

Hubei has begun construction on 80 square kilometers of sponge cities.

In 2017, construction was initiated on 80 square kilometers of sponge cities and 100 kilometers of underground utility tunnels. We focused on advancing the construction of projects such as the Han-Shi High-Speed Railway, the Zheng-Wan High-Speed Railway, the Hubei section of the Meng-Hua Railway, and the Northern Hubei Water Resource Allocation Project. We also aimed to start construction on the Hubei section of the Hu-Nan High-Speed Railway and the Shiyan section of the Wu-Xi High-Speed Railway. We comprehensively launched projects including reinforcing the embankments of five major lakes, rehabilitating 14 key tributaries, enhancing drainage capacity in areas prone to flooding, and accelerating the reinforcement of 1,321 reservoirs identified as being at risk.

Fujian’s infrastructure investment reached 852 billion yuan.

Fujian is accelerating the construction of major projects in railways, expressways, rail transit, airports, ports, energy, water conservancy, environmental protection, information and communication, and urban public utilities, with infrastructure investment reaching 852 billion yuan. Newly constructed, renovated, or expanded urban roads, stormwater networks, sewage networks, water supply networks, and greenways each totaled 1,500 kilometers, while gas pipelines extended by 1,000 kilometers. Construction has begun on 100 kilometers of underground utility tunnels. Additionally, construction has started on 69,000 units of affordable housing projects, with over 40,000 units already completed.

Shanxi optimizes and upgrades its “railway, highway, and aviation” infrastructure.

In 2017, Shanxi Province optimized and upgraded its “railway, highway, and aviation” infrastructure, accelerated the construction of key projects such as the Datong-Zhangjiakou Passenger Railway, the Taijiao Passenger Railway, the Yuanda Passenger Railway, and the Yangquan North-Dazhai intercity railway, unblocked inter-provincial dead-end roads, and advanced the construction of 14 highway exit points that had not yet been connected to other provinces. The province also launched a pilot program for “one-stop operations” at the Taiyuan air port, expedited the formal opening of the Datong air port, and accelerated the development of dry ports in Taiyuan, Datong, and Linfen.

Henan is promoting the construction of 8,000 major projects.

Henan Province is accelerating the construction of infrastructure in areas such as transportation, water conservancy, energy, and information, and is promoting the implementation of 8,000 major projects, aiming to complete investments totaling 1.8 trillion yuan for the year. This year, 420,000 new commercial residential units have been started, and 300,000 units are expected to be basically completed. The planned total annual investment is 430 billion yuan, with 183 projects scheduled to commence construction this year.

Jiangsu has started more than 1,600 projects with investments exceeding 100 million yuan.

Jiangsu has started construction on more than 1,600 key projects with investments exceeding 100 million yuan each and completed over 600 such projects throughout the year. It has also implemented 1,000 technological upgrade projects with investments exceeding 100 million yuan each, with total completed investment reaching 660 billion yuan. Construction has begun on expressways including the Wuhuang Expressway, and the Second Yangtze River Highway Bridge in Wuhu has been completed. As a result, the province has added 130 kilometers of new expressways and 300 kilometers of first-class highways, renovated and upgraded 3,000 kilometers of ordinary national and provincial trunk roads, completed the Rural Road Connectivity Project covering 21,000 kilometers, and added 123 kilometers of new railway lines.

Guizhou invests 190 billion yuan.

Guizhou is investing 190 billion yuan to accelerate the completion and opening of the high-speed railway connecting Guiyang to Chongqing, and to speed up the construction of other high-speed railway projects such as those linking Guiyang to Chengdu and Guiyang to Nanning. The third-phase expansion project of Longdongbao Airport will also be advanced, construction will begin on Weining Airport, and Liuping and Lipu airports will undergo renovation and expansion. In terms of water conservancy, investments totaling 26 billion yuan will be made to expedite the construction of major water control projects including Jiayan, Maling, and Huangjiawan. Additionally, 60 key water source projects will be launched, 15 dilapidated and dangerous reservoirs will be rehabilitated, and the number of counties with medium-sized reservoirs that have been completed and put into operation will reach 70. Finally, grid investment will total 12 billion yuan.

Zhejiang has launched 624 new projects.

Zhejiang plans to commence construction on 624 new projects with a total investment of 790.3 billion yuan. It will ensure that the investment in major “411” projects exceeds 1 trillion yuan, and that investments in key infrastructure—including transportation and water conservancy—as well as in major industrial projects, critical technological upgrades, and ecological and environmental protection, all grow by more than 15%. We will vigorously promote the construction of beautiful villages and picturesque rural landscapes, actively strive to establish demonstration counties for integrated tourism, tourism-themed towns, and model leisure tourism villages, and aim to have 2,000 villages designated as A-level scenic areas, including 200 scenic areas rated 3A or higher. We will advance rail transit construction by 500 kilometers, add and upgrade 1,000 buses, build or renovate 1,000 bus stops, add 100,000 new parking spaces, build 300 new “reassuring” agricultural markets, add 1,000 new rural cultural halls, and establish 3,000 new rural e-commerce service stations.

Yunnan plans to implement 78 expressway projects.

Yunnan Province plans to implement 78 expressway projects in 2017, with a total construction mileage of 6,690 kilometers. It also plans to upgrade and renovate 2,900 kilometers of ordinary national and provincial roads, and to build or reconstruct 50,000 kilometers of rural roads.

The commencement of infrastructure projects is boosting demand for sand and gravel aggregates, with the sand and gravel industry being the most direct beneficiary. There are two key reasons for this: First, the sand and gravel industry is a typically regional one, and thus less affected by supply-and-demand dynamics in other regions. Second, under the broader context of supply-side reform, if backward production capacity is excluded, there could even emerge a certain gap between supply and demand. As a result, the supply and demand for sand and gravel aggregates will enter a state of tight balance in 2017. The launch of infrastructure projects in various provinces and cities will, accordingly, drive the production and sales of sand and gravel aggregates by enterprises in those regions, thereby spurring a boom in the sand and gravel industry.