\u3000\u30001. The mismatch between supply and demand continued, and aluminum prices continued to rise. Under the mismatch of supply and demand, the prices of alumina and electrolytic aluminum have continued to rise recently. As of February 11, 2022, the price of alumina was reported at 3258 yuan / ton, with a weekly increase of 2.5% and a year-on-year increase of 35.2%; The price of electrolytic aluminum was reported as 22922 yuan / ton, with a weekly increase of 6.6% and a year-on-year increase of 48.1%. The main reason for the rise of aluminum price is the limited supply of global aluminum products under the influence of carbon neutralization. Abroad, under the influence of carbon neutralization and the limited supply of natural gas in Russia, the price of natural gas in Europe has risen sharply and the price of electricity has continued to rise. As of February 12, 2022, the continuous settlement price of UK natural gas futures closed at 185.86 pence / Semm, an increase of about 318.3% year-on-year. The rise of electricity price has increased the production cost of aluminum enterprises, and manufacturers have successively issued production reduction plans. In China, Shandong, Xinjiang, Inner Mongolia and other major aluminum producing provinces launched restrictive policies for electrolytic aluminum and other high energy consuming industries in the fourth quarter of 2021, resulting in a year-on-year decrease of 3.5% in the output of electrolytic aluminum in the fourth quarter. In addition, the continuous development of construction, real estate, transportation and power industries in the downstream of aluminum has further increased aluminum consumption and promoted the rise of aluminum price. Looking ahead, aluminum prices are expected to continue to rise. In the short term, the supply of electrolytic aluminum is still tight, the production reduction of foreign aluminum plants continues, and most of the electrolytic aluminum production capacity under China’s policy control has not been resumed. According to the statistics of Baichuan Yingfu, the total resumption scale of electrolytic aluminum in China in 2022 was 2257000 tons, and the current resumption scale is about 40.8%. In the long run, the demand for lightweight vehicles driven by new energy vehicles and the continuous construction of UHV projects during the 14th Five Year Plan period will drive the growth of aluminum demand. Under the mismatch of supply and demand, aluminum prices are expected to continue to rise.
\u3000\u30002. In the past week, the prices of most major non-ferrous metals rose, including neodymium oxide rose by 10.0% and SHFE lead closed down slightly. In terms of neodymium oxide, as of February 11, 2022, the price of neodymium oxide was reported at 1.16 million yuan / ton, with a weekly increase of 10.0%. The main reason for the rapid rise of neodymium oxide price is that there are index restrictions on rare earth supply and the rapid development of downstream new energy industry drives the growth of demand for rare earth permanent magnet; In terms of metal lead, as of February 11, 2022, the settlement price of SHFE lead futures in the Chinese market was reported at 15000 yuan / ton, down 0.1% this week. The slight decline in China’s lead price is mainly affected by low downstream demand and loose supply after the festival.
\u3000\u30003. The year-on-year growth rate of CPI in the United States has reached the highest level in nearly 40 years, and high inflation will continue to drive gold prices upward. On February 10, the US CPI data released that the US CPI rose 7.5% year-on-year in January 2022, the highest level since August 1982. Before and after the data release, the London gold price fluctuated sharply and then began to strengthen. As of February 11, 2022, the closing price of Comex gold futures rose to US $1858.9/oz, with a weekly increase of 2.8%. It is expected that gold prices will rise further against the background of high market inflation.
\u3000\u30004. Market review. Among the 9 CITIC nonferrous metal sub sectors, 8 sectors rose throughout the week and 1 sector fell. Among them, the aluminum sector increased the most, with an increase of 10.4%; Lithium sector fell the most, with a decline of 1.5%. In terms of individual stocks, the top three weekly increases were Jinzhou Jixiang Molybdenum Co.Ltd(603399) , Yunnan Aluminium Co.Ltd(000807) , Guocheng Mining Co.Ltd(000688) , with weekly increases of 25%, 24.3% and 24.1% respectively; The top three weekly declines were Guangdong Hoshion Aluminium Co.Ltd(002824) , Yinbang Clad Material Co.Ltd(300337) , Lizhong Sitong Light Alloys Group Co.Ltd(300428) , with weekly declines of 15.1%, 10.7% and 10.7% respectively.
Investment advice
Under the background of continuous rise of aluminum price and record high global inflation, electrolytic aluminum and gold production enterprises may benefit, such as Chifeng Jilong Gold Mining Co.Ltd(600988) , Zijin Mining Group Company Limited(601899) , Shandong Nanshan Aluminium Co.Ltd(600219) .
Risk tips
The output reduction of European and American aluminum enterprises was less than expected, the international epidemic was repeated, and the safety and environmental protection policies changed.
