The national energy work conference will be held in 2022, and the adjustment of energy structure will be accelerated.
On the afternoon of December 24, the 2022 national energy work conference was held in Beijing. The meeting comprehensively summarized the important achievements of energy work in 2021, stressed that energy work in 2022 should fully implement the new energy security strategy, deeply promote the energy revolution, go all out to ensure energy security, unswervingly promote green and low-carbon development, accelerate the construction of an energy power, and formulate seven key tasks. In 2021, China’s energy structure adjustment will accelerate, new energy will develop rapidly, and China’s development of non fossil energy will reach a new level. The installed capacity of renewable energy power generation in China will historically exceed 1 billion kw, the installed capacity of hydropower and wind power will exceed 300 million KW, the installed capacity of offshore wind power will leap to the first in the world, and the annual power generation capacity of new energy will exceed 1 trillion kwh for the first time, Continue to maintain the leading edge. The “14th five year plan” is a critical and window period for reaching the peak of carbon emission. All localities have successively formulated implementation plans for reaching the peak of carbon emission, vigorously developed clean energy and accelerated the green and low-carbon transformation of energy structure. In order to ensure the stability of power grid and clean energy consumption after the improvement of the installed scale of new energy power generation, the construction of relevant supporting power grid, energy storage and other facilities also needs to be strengthened.
Lithium salt prices in China rose in an all-round way and are still bullish in the future.
According to SMM data, As of Friday (December 24), battery grade lithium carbonate quoted 254000 yuan / ton, an increase of 16000 yuan / ton month on month; industrial grade lithium carbonate quoted 236000 yuan / ton, an increase of 12000 yuan / ton month on month; battery grade lithium hydroxide quoted 205000 yuan / ton, an increase of 14000 yuan / ton month on month; industrial grade lithium hydroxide quoted 202000 yuan / ton, an increase of 12000 yuan / ton month on month. On December 23, fastmarkets offered China’s batteries The evaluation price of grade lithium hydroxide is RMB 210000-220000 / T, with a month on month increase of RMB 15000 / T; The quotation for China’s battery grade lithium carbonate was RMB 25000-27000 / ton, with a month on month increase of RMB 20000-25000 / ton. This week, under the condition of tight supply of battery grade lithium carbonate in China, buyers continued to actively replenish, leading to its price continuing to rise. The tight supply was mainly due to the maintenance of a major lithium salt plant in China and the reduction of Qinghai Salt Lake in winter, which superimposed the impact of the epidemic on shipping, and the import volume fell. In November, China’s lithium carbonate import volume fell by 60.92% month on month. In the future, it is expected that prices will still rise against the background of supply shortage. The price of lithium hydroxide increased, mainly because some lithium iron phosphate manufacturers purchased battery grade lithium hydroxide and processed it into battery grade lithium carbonate, driving the demand for battery grade lithium hydroxide. Fastmarkets evaluated the CIF price of battery grade lithium carbonate in China, Japan and South Korea at US $33.5-35.5/kg, an increase of US $1.5/kg compared with last week; The estimated CIF price of battery grade lithium hydroxide in China, Japan and South Korea is US $31-33 / kg, up US $1 / kg from last week.
The price of thermal coal continues to be weak, and the future price will remain weak.
This week, the China Shipbuilding Industry Group Power Co.Ltd(600482) coal market continued a weak downward trend. In terms of origin, most of China’s mainstream large mines maintained normal production this week and continued to fulfill the long-term association and guarantee the supply of resources. Driven by the high inventory of downstream power plants and the low enthusiasm to transport and replenish the warehouse, and superimposed with the great impact of the decline in the purchase price of large coal enterprises in the new phase, Inner Mongolia Eerduosi Resources Co.Ltd(600295) the inventory of some coal mines in the region increased, and the pit mouth price decreased significantly. The downstream demand in Yulin mainly comes from users such as chemical industry and coal washing plant. The demand for power coal is also weak, and some coal mines hold bearish expectations for the future market. In terms of downstream demand, the daily consumption of China’s downstream power plants increased slowly this week, the inventory continued to operate at a high level, and the enthusiasm for replenishment was not high; At the same time, the coal prices of origin and port are in the downward channel, which further aggravates the wait-and-see mood of downstream users. Some users delay the purchase plan and temporarily focus on digesting their own inventory.
The average price of LNG in China fell first and then rose, and the price of natural gas in the United States stopped falling and rebounded
The average LNG price in China fell first and then rose this week. In terms of supply, the output of China’s LNG plants increased slightly month on month this week, and the arrival volume of sea and gas also increased month on month last week. The supply environment is still relatively loose. In terms of demand, as many places in China have been affected by cold air this week, the demand for some urban fuel storage has increased, and the upstream price support mentality has strengthened. However, at present, some areas are still limited by public health events. LNG supply may decline in a narrow range next week, and LNG demand may continue to fluctuate. It is expected that the LNG market may be strong in the near future, but the price increase is limited. The U.S. natural gas market fell first and then rose in this cycle. In the early stage of the cycle, the U.S. temperature was relatively warm and stable, and the decline of natural gas inventory announced by the U.S. energy information administration was lower than the market expectation, which had a negative impact on the market. In the later period of the cycle, some meteorological institutions predicted that the rainy and snowy weather in the future may increase and the temperature is expected to decrease. The sharp rise of the natural gas market in Europe also boosted the US natural gas market to a certain extent. In the future, Christmas is coming. Affected by the holidays, it is expected that the overall industrial and commercial gas demand in the United States will decline, which has limited support for natural gas prices. However, the continuous high price of natural gas in Europe will also affect the U.S. market or limit the decline.
Investment advice
At present, countries all over the world regard lithium resources as strategic mineral resources. It is very important to ensure the supply security of lithium metal minerals and establish a local supply chain. At the same time, with the continuous rise in the price of lithium concentrate, the profits of non integrated lithium salt processing enterprises are gradually thinning, and the profits have largely moved to the resource side. A typical example is aokuang, which is highly dependent on China’s lithium salt processing plants. In the last cycle, it only earned 30% of the profits of the industrial chain, and 70% – 80% of the profits in this cycle have been transferred to aokuang, which just confirms aokuang’s expectation that the profits of this cycle and China’s lithium salt plants will open at the beginning of the year. Under the current background, the competitiveness of integrated enterprises with upstream resource guarantee and incremental resources is obviously stronger. It is recommended to pay attention to the ongoing Lijiagou spodumene mining and beneficiation project. In the future, it will join hands with Dongchuan energy investment to integrate and develop the lithium resources in Ganzi and ABA. The beneficiary targets include [ Youngy Co.Ltd(002192) ] which is promoting the 2.5 million T / a lithium ore beneficiation project in yuanyangba. The greenbushes mine will increase production in the next five years and can achieve a large output of [ Tianqi Lithium Corporation(002466) ] through OEM, [ Qinghai Salt Lake Industry Co.Ltd(000792) ] with good performance of potash fertilizer and lithium salt in 2022, and [ Yongxing Special Materials Technology Co.Ltd(002756) ] is expected to be completed next year.
In the process of accelerating the transformation of energy structure to green and low-carbon, the installed capacity of new energy is expected to grow rapidly, and new energy operators benefit from the increase of scale, the improvement of operation efficiency and the thickening of performance. We recommend paying attention to the new energy target of thermal power transformation [ Huaneng Power International Inc(600011) ]; At the same time, [ Cecep Solar Energy Co.Ltd(000591) ] and [ Cecep Wind-Power Corporation(601016) ] new energy operation power stations have benefited, and the Hong Kong stock targets have benefited from [Longyuan Power], [China Resources Power] and [China power].
During the “14th five year plan” period, water enterprises are expected to attract more capital investment, improve operation scale and generate benefits with the help of local governments under the promotion of policies. It is recommended to pay attention to the low value and high growth sewage treatment enterprises [ Anhui Zhonghuan Environmental Protection Technology Co.Ltd(300692) ] and [ Guangdong Liantai Environmental Protection Co.Ltd(603797) ].
Waste incineration is an industry encouraged and supported by the national industrial policy. Promoting the integrated construction and professional operation of urban domestic waste treatment facilities is the development trend of the industry, and the professional waste treatment service providers providing integrated investment, construction and operation services will have a competitive advantage. Under the policy background of “carbon neutralization and carbon peak”, the waste incineration power generation project will continue to benefit. We recommend paying attention to the leading waste incineration projects [ Dynagreen Environmental Protection Group Co.Ltd(601330) ] and [ Chongqing Sanfeng Environment Group Corp.Ltd(601827) ].
Risk statement
1) The implementation of carbon neutralization related policies is less than expected;
2) The demand for thermal coal and natural gas decreased seasonally;
3) Major changes in power policy;
4) The development progress of lithium mine in Sichuan is less than expected.
