Continue to be optimistic about the new energy metal sector: sentiment rebounded, and the valuation is expected to form positive feedback. At present, the prices of lithium carbonate and lithium hydroxide have reached new highs, and the profit per ton of lithium carbonate has also reached 219000. At present, the sentiment of lithium mining sector has rebounded, the strong fundamentals have been gradually recognized by the market, lithium mining stocks have rebounded first, and there are signs of positive feedback on valuation. At present, the valuation of lithium target is still in a position. We are optimistic about the new high Sinomine Resource Group Co.Ltd(002738) , as well as other lithium targets obvious to alpha.
The price of raw materials increased rapidly, and the downstream acceptance was acceptable. In terms of lithium carbonate, the acceptance of downstream enterprises for high-cost lithium carbonate has decreased. Some enterprises slightly reduced the production of medium and low nickel ternary, and the price increase of lithium carbonate slowed down this week. The price of lithium hydroxide increased significantly this week, mainly due to the inspection and repair of upstream enterprises in turns, and the continuous production increase of downstream high nickel enterprises and the widening gap. The pricing of mainstream cathode manufacturers is cost + processing fee. The price of raw materials rises rapidly. Although there is some resistance at the beginning of the terminal, at present, the acceptance is OK, and the price transmission is not significantly blocked.
Tensions in Ukraine have intensified and commodity uncertainty has increased. Since the outbreak of the conflict between Russia and Ukraine, commodities such as gold and crude oil have fluctuated sharply. According to the data, in 2020, Russia’s nickel production accounted for 9.7% of the world, electrolytic aluminum production accounted for 6.1% and copper production accounted for 4.2%. Although the United States has not imposed sanctions on Russian aluminum enterprises for the time being, it does not rule out the possibility that the situation continues to deteriorate and the U.S. sanctions escalate.
Copper Fundamentals: downstream consumption is still relatively low. Since the Spring Festival, the recovery of downstream construction in China has been less than expected. According to SMM statistics, the new orders for wires and cables are not ideal, and the operating rate of copper poles is 58.35%, down 0.6pct from last week. Copper prices fell during the week, and downstream orders increased slightly, but still less than expected. China’s copper premium continues to decline, and China’s inventory is still in the stage of accumulating reserves.
Aluminum Fundamentals: the short-term operation space is more difficult, so it is suitable for long-term layout. According to SMM statistics, China’s aluminum ingot inventory accumulation has slowed down this week, and the aluminum ingot inventory is expected to have an inflection point in March. At the same time, in terms of midstream processing, aluminum rod inventory decreased by 4000 tons month on month, and the operating rate of leading aluminum processing enterprises was 68.1%, with a month on month increase of 1.6pct. Tight overseas aluminum supply + strong Chinese consumption, aluminum prices are easy to rise but difficult to fall. The tense situation between Russia and Ukraine makes it more difficult to operate in the short term. The long-term fundamentals of aluminum are good and can be laid out in the long term.
Focus on: Sinomine Resource Group Co.Ltd(002738) , China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) , Lizhong Sitong Light Alloys Group Co.Ltd(300428) , Tianqi Lithium Corporation(002466) .
Risk tip: the macro environment changes, the demand is lower than expected, and the policy uncertainty increases.
