Core logic
It is estimated that there will be a shortage of 110000 tons of electrolytic aluminum in 22 years, and the supply and demand will maintain a tight balance. The supply side is close to 45 million tons for a long time, and the ceiling is controlled for a long time. In the short term, the production capacity of Yunnan and Guangxi is expected to be partially released with the mitigation of energy consumption in 22 years. On the demand side, the real estate and manufacturing industries rebounded. The demand and supply were relatively stable in 22-23 years, and the supply and demand of the industry maintained a tight balance. It is estimated that there will be a shortage of 230000 tons, 110000 tons and 10000 tons of electrolytic aluminum in China in 21-23 years.
Price & Profit: it is estimated that the price center will be 20000 yuan / ton in 22 years, the profit level will remain high, and the electricity price is the profit variable. The supply of raw materials such as bauxite, alumina and prebaked anode is relatively loose, and the price of raw materials is difficult to dominate the profits of the industrial chain; The core is the electricity price. The electricity price increases by 0.1 yuan, the ton cost increases by 1370 yuan, and the profit space of enterprises with high proportion of self owned electricity and hydropower is greater. It is expected that the profits of the industrial chain will be transferred to electrolytic aluminum enterprises in 22 years, and the profit center will remain in the range of 2000-3000 yuan / ton.
Supply side: the total supply in 22 years is predicted to be 39.83 million tons, including China’s electrolytic aluminum output of 39.03 million tons and net import of 800000 tons.
The pre production capacity in 22 years was 1.7677 million tons, mainly because the production in 21 years did not reach the expected capacity, which was concentrated in Yunnan, Inner Mongolia and Guangxi. In the past 21 years, China’s production capacity decreased by 3.75 million tons, mainly in Yunnan, Guangxi, Xinjiang and Inner Mongolia. It is mainly considered that the production reduction in Yunnan and Guangxi is large, and it is speculated that the energy consumption index will be relatively loose next year. It is expected that the proportion of investment and resumption of production will be high in 22 years. It is conservatively predicted that the production capacity will be increased by 2.07 million tons and the output will be increased by 940000 tons.
The net import of electrolytic aluminum reached 1.1 million tons in 21 years, and the main demand weakened in 22 years. It is expected that the import will decrease. Imported electrolytic aluminum is an important supplement to the supply side. It is expected that the demand for aluminum will slow down in 22 years, and the import volume will drop to 800000 tons. In addition, recycled aluminum is an important supplement to the future supply side, but at present, China’s industrial scale is still small and the industrial order is not perfect.
Demand side: new energy vehicles and photovoltaic boost demand, and the growth rate of aluminum for construction remains stable. The total demand is expected to reach 39.95 million tons in 22 years, an increase of 1.3% year-on-year in 21 years.
Real estate sales were pessimistic in 22 years and weakened in the second half of the year after completion in 21 years. It is expected that the growth rate of aluminum for construction will remain flat. It is expected that automotive aluminum will rise steadily, the growth rate of traditional vehicles will be stable in the second half of the year, and the production and sales of new energy vehicles will reach record highs. It is conservatively estimated that the aluminum consumption of new energy vehicles in 22-23 years is 220000 / 330000 tons, CAGR = 138%. At the emerging demand side, China’s photovoltaic installed capacity continues to increase, and the aluminum consumption of photovoltaic power station components is CAGR = 19%. It is estimated that the aluminum demand increase in 22-23 years will be 39 / 450000 tons.
Investment proposal & investment object
Electrolytic aluminum is an energy intensive industry, and cost is the core factor. It is optimistic that enterprises with scale advantages and production capacity of the whole industrial chain can control costs for a long time. Secondly, in combination with the large fluctuation of current electricity price, the advantages of enterprises with cheap electricity price or self provided electricity are more significant. It is suggested to pay attention to Yunnan Aluminium Co.Ltd(000807) , Henan Shenhuo Coal&Power Co.Ltd(000933) (the proportion of hydropower is gradually increased, and the production capacity is released in 22 years). At the same time, it is suggested that aluminum processing enterprises should be optimistic about Henan Mingtai Al.Industrial Co.Ltd(601677) , Shandong Nanshan Aluminium Co.Ltd(600219) , Shanghai Huafon Aluminium Corporation(601702) .
Risk statement
Downstream demand is lower than expected, upstream raw material prices rise sharply, new production capacity exceeds expectations, imported electrolytic aluminum exceeds expectations, and power policy adjustment risks.
