The London Metal Exchange (LME) saw a sharp rise in nickel, and there were rumors that Castle Peak Holdings Group Co., Ltd. (hereinafter referred to as “Castle Peak Holdings”) was forced to hold short nickel futures contracts. Thus, this mysterious private steel enterprise was pushed into the spotlight of the market.
With the sharp fluctuation of nickel price, the London Metal Exchange announced on March 8 that all nickel transactions executed on the OTC and LME select screen trading system on or after 0 a.m. local time on March 8 would be cancelled, and the delivery of all spot nickel contracts originally scheduled to be delivered on March 9, 2022 would be postponed.
On March 9, Qingshan holdings responded that it would replace China’s metal nickel sector with its high matte nickel, which has been allocated to sufficient spot for delivery through various channels. Analysts generally believe that the long and short forces in London’s nickel futures market have reversed, and the above-mentioned malicious foreign capital may face the embarrassing situation of “lifting a stone and hitting their own feet”.
What kind of company is Qingshan holding, and whether the market rumors are true? On March 9, the reporter of securities times · e company visited the Shanghai headquarters of Qingshan holdings. A red fence has been put up at the gate of the company, and several security guards stationed at the door and said “no entry without appointment”. An employee of Qingshan holdings told reporters that his normal work has not been affected at present. “Low profile and strong strength”, the staff of the same park described Qingshan holdings to reporters.
strict security
employees say their work is not affected
The office area of Shanghai port international passenger transport center, located in Hongkou District, Shanghai, has gathered a number of shipping and trading companies. Qingshan holdings is “the best and most powerful office area” among the park staff. When it comes to Qingshan holdings, some park staff told reporters, “they are very rich. Their office building was bought for more than one billion yuan. They spent a lot on decoration more than a year ago. The company has mines in Indonesia, but usually they are very low-key.”
On the facade of the “Zhejiang holding building” is an 8.8-storey SUV, which is also hung on the facade of the industrial holding building In the 1980s, Qingshan industry was born in Wenzhou, Zhejiang Province. After decades of development, it has become the largest stainless steel enterprise in the world. The board of directors of Qingshan industry is located in Shanghai. It owns five groups, including qingtuo group, Yongqing group, Qingshan holding group, Shanghai Dingxin group and Yongqing Co., Ltd., and governs more than 300 subsidiaries. In 2020, the sales reached 292.8 billion yuan, ranking 279 among the world’s top 500 enterprises in 2021, 80th among the top 500 Chinese enterprises in 2021 and 14th among the top 500 Chinese private enterprises in 2021.
“This building belongs to Castle Peak. We are a property. We can’t go in without an appointment.” Several security guards at the door stopped the reporter. As the staff of the park said, “the strength of Castle Peak can be seen from the decoration”. The large lobby is mainly white and gold, with a large construction area. Reception areas are set on the left and right sides of the lobby. The reporter noted that there were few employees in and out of the Castle Peak office building, and only a few employees went out during lunch time. “We have our own restaurant on the second floor. The building has complete facilities.” An employee of Qingshan holdings told reporters.
For the rumor of closing positions, the employee of Qingshan Holdings said he didn’t understand it. “I don’t know about it. The leader didn’t tell us. The security guard downstairs told me. We all work normally. I feel it doesn’t matter.” The employee said that the company moved from Shanghai Xintiandi this year and there are other industrial parks in Shanghai. Its headquarters are now in Shanghai, including management in the building. As for business, the employee said that affected by the epidemic, exports have been done less in recent years.
The reporter noted that employees of other companies in the same park as Qingshan holdings also pay attention to market rumors. “There are still many uncertain situations, which may involve trade secrets, and market speculation is normal.” A park employee passing by Castle Peak Building told reporters that when talking about his impression of Castle Peak holdings, the employee said he was “very low-key”.
On the afternoon of March 8, Qingshan holdings replied to the media that it was preparing materials and would make a unified public response later. The reporter of securities times · e company found that at present, the official website of Qingshan holdings could not be opened, showing “502 error”. On the afternoon of March 9, the reporter called Qingshan holdings, which showed that the “line was busy” and was not connected.
sea layout of new energy industry
Qingshan holdings is a private enterprise specializing in stainless steel production. It has formed a whole industrial chain layout from nickel mining, ferronickel smelting to stainless steel smelting, stainless steel continuous casting billet production and stainless steel sector, rod and wire processing. At the same time, it produces raw materials, intermediate products and new energy batteries in the field of new energy, which are mainly used in the fields of energy storage system and electric vehicles.
Enterprise investigation shows that Qingshan holdings was established in June 2003 with a registered capital of 2.8 billion yuan. The major shareholder is Shanghai Dingxin investment group (hereinafter referred to as “Dingxin group”), and Wenzhou businessman Xiang Guangda holds 71.5% of the shares of the former. In 2009, Dingxin group and Indonesia’s local Baxing group jointly established Indonesia Sulawesi Mining Investment Co., Ltd., and Qingshan holding holds 50.35% equity of the joint venture. Thus, Qingshan holdings opened the sea Investment in ferronickel production.
On the afternoon of March 9, the reporter of securities times · e company visited Dingxin group in Pudong New Area of Shanghai, and the door of the company was locked. The security guard at the door also refused the reporter’s visit on the grounds that “you need to make an appointment and you can only enter if you have a contact person”. An employee of Dingxin group left in a hurry after hearing the “rumor of closing positions”.
In addition, the reporter noted that the name of “Ruipu energy” appeared in the visit column of the visit list of the security booth. It is understood that Ruipu energy is a battery manufacturing enterprise laid out by Qingshan industry in the field of new energy, focusing on providing solutions for new energy vehicle power and smart power storage.
Haitong Securities Company Limited(600837) research report shows that the ferronickel business of Qingshan holdings in China is mainly distributed through Fujian qingtuo group. At present, qingtuo group has formed an annual production capacity of 1.8 million tons of nickel alloy. Foreign business is realized through Indonesia’s Qingshan Park (IMIP) and widabe Industrial Park (IWIP), with a total capacity of more than 3.5 million tons / year. Controlling nickel means controlling the upstream of stainless steel. In 2019, it has a nickel production capacity of 300000 tons, accounting for 12% of the global share. In 2022, the production capacity will reach 850000 tons, which is worthy of the name of “world nickel king”. Castle Peak holdings is now the world’s largest nickel exporter and the world’s largest stainless steel producer.
It is worth mentioning that another field of nickel application is the new energy field with high market attention. According to the Research Report of Ping An Securities, benefiting from the high nickel content of power batteries and the rapid development of new energy vehicles, the global and Chinese nickel demand is expected to grow at a compound growth rate of 4.0% and 4.3% from 2019 to 2025.
Relying on the advantages of rich upstream resources, Castle Peak began to enter the new energy industry in 2017, trying to build a new energy industry chain of “nickel cobalt mineral resources mining hydrometallurgy precursor cathode material battery application”. On December 9, 2021, Aoyama holdings announced that its large-scale battery high nickel matte project in Indonesia was put into operation.
In addition, Qingshan holdings is also involved in lithium resources. In November 2021, French stainless steel and ferronickel giant Eramet announced that it would introduce Castle Peak holdings as a partner to restart the construction of its 24000 ton LCM salt lake lithium extraction plant in Argentina’s centenario ratones Salt Lake (hereinafter referred to as Cr Salt Lake).
several A-share companies responded to the impact
As an important global producer of stainless steel and ferronickel, Castle Peak Holdings has close cooperation with a number of A-share listed companies. After falling the limit for two consecutive days, Zhejiang Huayou Cobalt Co.Ltd(603799) 3 announced on March 9 that the nickel futures market had abnormal fluctuations recently. Up to now, the company has not been forced to close its position, and the risk is controllable. There is uncertainty in the future trend of nickel futures, which may lead to losses in the company’s hedging business.
Zhejiang Huayou Cobalt Co.Ltd(603799) said that at present, the company’s production and operation are normal, and its nickel and cobalt resource development projects such as laterite nickel ore hydrometallurgy crude nickel and cobalt hydroxide project and laterite nickel ore pyrometallurgy high matte nickel project in Indonesia are progressing normally, Among them, the annual output of 60000 tons of nickel metal laterite nickel ore hydrometallurgy project of the subsidiary Huayue nickel cobalt Co., Ltd. has been successfully put into trial production.
“At present, the company has not participated in nickel futures trading, and the position of nickel futures in the current period is zero. The” Qingshan nickel “short squeeze event hyped in the market has nothing to do with Zhefu Holding Group Co.Ltd(002266) and the company’s production, operation and operating performance are not affected by the nickel futures event.” Zhefu Holding Group Co.Ltd(002266) 3 announced on September 9 that up to now, the company has only conducted futures hedging business for part of the total production of copper and tin. At present, the hedging business of copper and tin is carried out normally, the margin amount is sufficient, and there is no situation of replenishing the margin due to warehouse explosion.
Zhefu Holding Group Co.Ltd(002266) said that the company plans to appropriately increase the types and margin of commodity futures hedging business, and carry out operational hedging business in due time according to the actual production of relevant metal products and the change trend of international bulk commodity prices.
On March 9, Ningbo Ronbay New Energy Technology Co.Ltd(688005) said on the interactive platform that the company’s production and operation were normal and did not participate in nickel futures trading. It is learned from upstream resource suppliers that some European long orders of Russian nickel are still being implemented. From the perspective of long-term supply and demand balance of nickel, the high price of nickel is unsustainable, and it is expected that the supply and demand balance of nickel will be realized.
Gem Co.Ltd(002340) announced at noon on March 9 that the nickel futures event had nothing to do with Gem Co.Ltd(002340) and the company’s production, operation and operating performance were not affected by the nickel futures event Gem Co.Ltd(002340) nickel containing products are traded based on the monthly average price. The short-term sharp decline and rise of nickel will not affect the Gem Co.Ltd(002340) trading pricing system and have no substantive impact on Gem Co.Ltd(002340) operation Gem Co.Ltd(002340) Indonesia nickel resources project will not be affected by this nickel futures event.
In addition, Metallurgical Corporation Of China Ltd(601618) 3 said on the investor interaction platform on March 8: as a listed company of a central enterprise, the company strictly abides by the regulatory requirements of SASAC on prudently developing financial derivatives business, and currently has no nickel futures business. It also said that the current international nickel futures price has increased significantly due to geopolitical, low inventory and financial trading factors The rapid rise has deviated from the fundamentals. As an important international wet nickel production and technology export enterprise, the high price is naturally beneficial to the company, but we should also pay attention to the undertaking capacity of the downstream market in the short term, and consider the healthy development of the whole new energy industry chain in the medium and long term.
For the follow-up of nickel price, China Securities Co.Ltd(601066) futures research report said that the current rise of Lun nickel has been difficult to explain from the perspective of fundamentals. Although the overall environment is still conducive to nickel price, the follow-up risk can not be ignored. After the sharp rise of nickel price, the spot market may fall into a temporary stagnation, and the downstream cannot accept the current high price. Some manufacturers may cut production due to the interruption of raw materials and wait for the market to return to normal.
