research conclusion
The outbreak of the delta epidemic in India has not had a great impact on China's production links, We believe that the reasons are: (1) India's export products do not have a strong influence on Global trade. Except for high-quality mica, drugs (including vaccines), cotton and jute, India's main export products have limited influence, and most of their output is less than 10% of the global output; (2) The trade scale between China and India is limited, and the dependence of Chinese industry on India's main export commodities is not high. In 2019, imports from India accounted for about 0.9% of China's total imports, of which textile raw materials and textile products accounted for only 5%.
The industrial and trade characteristics of Southeast Asia are the main reasons for the "core shortage" of Chinese cars: (1) China imports a large number of electromechanical related intermediate products from Southeast Asia. From January to October 2021, China's electromechanical products imported from Vietnam and Malaysia accounted for 11.9% of the total imports of electromechanical products, mainly integrated circuits and mobile phone parts used as processors and controllers; (2) The semiconductor industry in Southeast Asia has a large scale and global influence. Southeast Asia accounts for 27% of the global chip packaging and testing market; (3) the epidemic has a longer impact on Southeast Asian production. The PMI of manufacturing industry in Vietnam and Malaysia was lower than the Kuo Jung line for four months and much higher than that in India for one month.
South Africa is the main source of some important metal minerals in the Shanxi Guoxin Energy Corporation Limited(600617) field. Although South Africa's global export share is less than 1%, However, South Africa is the world's major producer and exporter of some minerals (including platinum group metals and manganese related to new energy), and China imports a high proportion of these minerals from South Africa: in 2020, the output of platinum and manganese ores in South Africa accounted for 70.6% and 28.1% of the world respectively; in 2020, the quantity of platinum and manganese ores imported by China from South Africa accounted for 57.6% and 43.5% of their total imports respectively.
South Africa holds important ports in landlocked African countries, so even if the epidemic does not spread, the impact is not limited to South Africa itself. South Africa has the third longest coastline in Africa, has three major ports: Durban port, Cape Town port and sardania port, and controls the export channels of some African landlocked countries. Taking Congo gold as an example, about 80% of its cobalt ore exports need to be transported by road, starting from the southern part of the province of Zambia, Zimbabwe, Botswana and South Korea's Durban port.
The epidemic will probably impact the mining industry in South Africa, resulting in a short-term supply and demand gap for some raw materials. Gauteng Province, where the "golden city" Johannesburg is located, has the most serious epidemic due to its dense population, accounting for 70% of the new cases in South Africa in early December. In other provinces, the epidemic situation is relatively serious in those involving the mining industry chain, such as Limpopo Province, pumalanga province and northwest province, which are rich in minerals, There are also KwaZulu Natal province (Durban port) and Western Cape Province, where important ports in South Africa are located (Cape Town port). Considering the fact that half of the new cases in northwest Africa in June 2020 occurred in the mining industry, South Africa's mining industry is likely to be affected. Although major mining countries have some epidemic prevention experience and mainly adopt regional and structural epidemic prevention policies, the epidemic has a significant impact on areas with weak epidemic prevention capacity such as Africa and Latin America There is greater uncertainty.
If the epidemic in South Africa accelerates, cars may face supply constraints again. If Omicron affects China's import of minerals from South Africa (or other African regions), the production of new energy vehicles (shortage of battery raw materials) and traditional vehicles (shortage of exhaust purification catalysts) may be affected, which is similar to the "lack of core" in the third quarter.
Risk statement
The impact and sustainability of Omicron on Africa exceeded expectations.
Covid-19 epidemic in Southeast Asia once again affected semiconductor shipments.
