Chinese heating appliances are keeping Europe warm this winter
The Russian invasion of Ukraine has led to high gas and electricity prices across Europe, where people are buying large numbers of low-cost Chinese electric blankets, heaters, heat pumps, and other products to battle the coming cold.
Electric blankets
Yesterday, the stock price of Rainbow Group 成都彩虹集团, a manufacturer of electric blankets, jumped by almost 10% on the Shenzhen Stock Exchange, ending an eight day increase of 70%. The reason is simple: Europe’s energy crisis and fast approaching winter.
Even though a company representative stated on Tuesday this week that Rainbow Group’s products are mostly sold in China and that its export business is still at a preliminary stage, the company is one of many in China that is set to benefit from European residents purchasing large numbers of electric blankets, heaters, stoves, heat pumps, and other products.
According to China Customs data, in the month of July, 27 European Union (EU) countries collectively imported 1.29 million electric blankets from China, a month-on-month increase of nearly 150%, which suggests that European consumers were stocking up for the winter. According to data by the China Household Electrical Appliances Association, in the first half of the year, China’s exports of electric blankets to the EU amounted to $33.4 million, a year-on-year increase of 97%.
Heaters and hot water bottles
Cixi, a small city just north of Ningbo in Zhejiang Province, is one of China’s heater production bases, accounting for around 30% of total national exports. Usually, the peak season for heater production ends around mid-September, but this year, production and exports are still going strong as we head into October because of increased demand from Europe.
According to Ningbo Customs officials, from January to August this year, Cixi exported heaters worth 3.35 billion yuan ($467.95 million), a year-on-year increase of 26.3%, of which 1.53 billion yuan ($213.72 million), or 45.67%, was accounted for by exports to the EU, a year-on-year increase of 55.2%. Earlier this week, the general manager of one company, Cixi Fuyun Electric 慈溪市富运电器, told a Chinese journalist that whereas last year the company exported heaters worth 160 million yuan ($22.34 million), this year they will export at least 200 million yuan ($27.93 million), and the company this year has 100,000 more orders, mainly from European customers.
A merchant at the Yiwu wholesale market in Zhejiang Province told a Chinese newspaper that while they would usually receive orders for hot water bottles of around 900,000 units, this year the largest orders are for 2 million units, and this year’s sales volume has doubled compared to last year. The goods are transported rapidly to Europe on express container trains.
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Heat pumps and stoves
Heat pumps are like air conditioners that can both cool and warm up the interior of a building. While they are very common in the U.S., in Europe houses are more commonly heated with district heating systems or gas boilers. But the soaring gas prices seem to have convinced many residents and building managers that heat pumps offer a more economical solution.
China is the world’s largest producer of heat pumps, accounting for about 60% of global production capacity. China’s heat pump exports in 2021 increased by 93.6% to 4.86 billion yuan ($678.87 million), and in the first seven months of this year, China’s exports of air type heat pumps increased by 63.7% year-on-year. A recent report estimated that by 2025, total sales of heat pumps in the EU will reach 5 million units, with a market size of 35 billion euros ($34.05 billion).
Haier Smart Home 海尔智家 claims to be China’s leading heat pump producer. In the first half of the year, Haier’s air type heat pump exports to Europe increased by more than 200% year-on-year, with the largest markets being France (an increase of 36%), Italy (64%), and Germany (26%). Midea’s 美的集团 heat pumps are also selling well in Europe, increasing by over 200% year-on-year in the first eight months of the year. In August, China’s leading exporters of heat pumps to Europe also included Gree 格力, PHNIX 芬尼, and Zhejiang Dayuan Pumps 大元泵业.
According to data by the Federal Statistical Office of Germany, as cited in Chinese media, from March to July this year, Germany imported 700,300 heating stoves, nearly two-thirds of which came from China, accounting for a year-on-year increase of 8.4%.
