[Key words of this week]: China’s social finance data in February was lower than expected; Russia Ukraine incident eased and commodity prices fell. Pay attention to the Fed’s interest rate meeting next week; Tesla and other models have started the tide of price rise; In February, the production and sales of new energy vehicles increased year-on-year; LME nickel staged a close position market, and the price hit a record high
Market review: 1. In terms of small metals, the sales volume of electric vehicles increased year-on-year in February, the prosperity of the industry continued to rise, and the prosperity trend of cobalt, lithium and rare earth in the upstream of new energy vehicles was clear and continued to be optimistic: 1) the overall output increment of lithium carbonate was not obvious. The Ministry of industry and information technology stressed that China’s lithium resources were independent and controllable. This week, battery grade lithium carbonate increased by 2.5% month on month, and the price of electric carbon has exceeded 500000; 2) In terms of rare earths, the quotation of praseodymium and neodymium oxide fell 3.6% this week. 2. The Russian Ukrainian incident eased, and the Fed is about to enter the interest rate hike cycle; In February, the CPI of the United States continued to hit a new high in the past 40 years. Under high inflation, Europe and the United States are facing potential stagflation risks: 1) base metals, LME, aluminum and copper decreased by 9.4% and 4.7% respectively; 2) The real yield of 10-year US bonds rose from – 0.93% → – 0.94%, Comex gold closed at US $1985.0/oz, up 0.94% month on month, and SHFE gold closed at 404.78 yuan / g, up 2.57% month on month. 3. A shares fell overall this week. Shenwan nonferrous metals index closed at 543125 points, down 7.03% month on month, outperforming the Shanghai Composite Index by 3.03 percentage points. Gold, industrial metals, new metal and non-metallic materials and rare metals rose or fell by 1.98%, – 6.48%, – 6.91% and – 7.04% respectively.
Macro “three factors” summary: China made further efforts to stabilize growth in an all-round way, and social finance in February was lower than expected; The CPI of the United States continued to rise year-on-year in February, reaching a new high in the past 40 years; The European Central Bank‘s interest rate resolution is “partial to Eagle”. Specifically: 1) China’s social finance in February was lower than expected. This week, it was disclosed that China’s CPI in February was 0.9% year-on-year (the previous value was 0.9%, the expected value was 0.84%); PPI was 8.80% year-on-year (previous value 9.10%, expected 8.76%); In February, the scale of social financing was 1.19 trillion yuan (the former value was 6.17 trillion yuan), a year-on-year increase of 10.2% (the former value was 10.5%); In February, RMB loans increased by 1.23 trillion yuan (the previous value was 3.98 trillion yuan and the expected value was 1.46 trillion yuan). 2) In the United States, the year-on-year data of February CPI and core CPI continued to pick up, and CPI continued to record the highest year-on-year growth rate since January 1982. In February, the quarterly CPI was 0.8% (the previous value was 0.6%) and CPI was 7.9% (the previous value was 7.5%) year-on-year. This week, it was disclosed that the number of initial claims for unemployment benefits was 227000, with a month-on-month rise of 11000. 3) The year-on-year and month on month GDP of the euro area in the fourth quarter of 21 years met expectations, and the epidemic was heating up. The European Central Bank‘s interest rate resolution was “partial Eagle”. This week, it was disclosed that the final value of GDP in the euro area in the fourth quarter of 21 years was seasonally adjusted to 0.3% (the previous value was 2.3%, the expected value was 0.3%), and the final value of real GDP was seasonally adjusted to 4.6% (the previous value was 4.0%, the expected value was 4.6%); This week, the European Central Bank announced the interest rate resolution, continued to maintain the monetary policy previously implemented, and the three major interest rates remained unchanged; In addition, the European Central Bank announced that it would accelerate the end of the asset purchase plan. 4) On the whole, the global manufacturing industry recorded pmi53.5 in February 4. Up 2.0 month on month; Here we maintain the judgment that the global economy has entered the downturn stage.
Base metals: Lun Ni incident drives market caution, and the Federal Reserve is about to enter the interest rate hike cycle
During the week, the Russian Ukrainian incident eased, and since March, the Fed is about to enter the interest rate hike cycle. Under high inflation, Europe and the United States are facing potential stagflation risks, and it is difficult to see the driving force of rapid inflation of bulk commodities; The lunni incident had a certain impact on the market, and major exchanges issued relevant regulatory measures. Specifically, LME copper, aluminum, lead, zinc, tin and nickel rose or fell by – 4.7%, – 9.4%, – 6.8%, – 6.4%, – 7.3% and 64.9% respectively this week, and the price fell as a whole.
1. For electrolytic copper, the smelters in northern China have gradually recovered from the production restriction of the Winter Olympic Games, and the rhythm of resumption of production is relatively stable. The supply of crude copper in the market is loose, the consumption tends to be better, and the copper price stabilizes at the end of the week; The marginal supply of copper concentrate is loose. This week, the copper concentrate processing fee index was reported at US $66.95/t, up US $0.45/t month on month. Events such as the conflict between Russia and Ukraine have limited impact on the overall supply of copper concentrate. On Wednesday, the social inventory of electrolytic copper was 206000 tons, and the weekly inventory was 10900 tons.
2. For electrolytic aluminum, on the supply side, China’s electrolytic aluminum production was mainly stable during the week, and the resumption of production was mainly concentrated in Yunnan and Guangxi. The resumed production capacity increased by 60000 tons compared with last week, and China’s electrolytic aluminum output increased steadily. This week’s electrolytic aluminum output was 808900 tons, up 0.47% month on month. On the consumer side, Chinalco’s downstream construction started to pick up. Although the high aluminum price inhibited some downstream construction, the downstream entry and preparation after the aluminum price fell at the end of the week. According to the calculation of 27502 yuan per ton of electrolytic aluminum, the immediate profit fell by 27.02% compared with the market price of 27502 yuan per week. This week, China’s eight aluminum ingot inventories totaled 1142000 tons, and the weekly cumulative inventory was 22000 tons.
3. For zinc ingots, overseas, the conflict between Russia and Ukraine has eased, but before the complete end of European energy, natural gas and electricity price still support the price; In China, under the high zinc price, terminal enterprises are afraid of high and wait-and-see mood is strong. The total inventory of zinc ingots in seven places this week was 285200 tons, and the weekly cumulative inventory was 10000 tons.
Upstream lithium battery raw materials: the prosperity of the global new energy industry continues to rise, the electric vehicle market in China, the United States and Europe resonates, and the upward trend of upstream raw material prices continues to strengthen:
1. The upward trend of industry prosperity remains unchanged. 1) China Shanxi Guoxin Energy Corporation Limited(600617) auto sales increased year-on-year: in February, the production and sales of new energy vehicles reached 368 / 334000 respectively, with a year-on-year increase of 2.0 times and 1.8 times; Affected by seasonal factors, the month on month growth rate decreased by 18.6% and 22.6% respectively, and the market share of new energy vehicles reached 19.2%. 2) Positive expansion of power battery production: China Shipbuilding Industry Group Power Co.Ltd(600482) battery output was 31.8gwh, with a year-on-year increase of 236.2%, basically unchanged month on month; The loading volume of power batteries totaled 13.7gwh, up 145.1% year-on-year and down 15.5% month on month. The ratio of power battery output / installed capacity in February was 2.32, reaching the highest level in history. Terminal enterprises are optimistic about the demand of the whole year, which is caused by the preparation of storage in advance in the downstream; 3) Tesla and other car companies started the price rise tide. Affected by the rising cost of raw materials, the decline of subsidies and the shortage of chips, nearly 20 new energy vehicles have announced price increases since March, involving nearly 40 models.
Among them, the current selling prices of Tesla Model 3 high-performance version, model y long-range and high-performance version have increased by 10000 yuan compared with the previous version.
2. The price of lithium carbonate has exceeded 500000 yuan / ton, and the development of lithium resources in China may be accelerated. 1) On the price side, the price of battery grade lithium carbonate increased by 2.5% to 517500 yuan / ton, the quotation of battery grade lithium hydroxide increased by 7.8%, the quotation of spodumene increased by 2.2%, and the price difference between lithium carbonate and lithium hydroxide narrowed rapidly. 2) On the supply side, affected by the weather, the heating season is not over, the natural gas supply is limited, and the output increment of China’s salt lakes is not obvious; 3) Lithium salt inventory: lithium carbonate inventory decreased by 1.2% month on month from 4899 to 4840 tons; Lithium hydroxide inventory decreased by 1.75% month on month from 741 to 728 tons.
3. With the tightening of raw materials, the price of cobalt may rise further. 1) On the price side, the quotations of MB cobalt (standard grade) and MB cobalt (alloy grade) increased by 2.9% and 2.9% month on month respectively; China’s metal cobalt, cobalt sulfate and cobalt trioxide rose 0.6%, 3.0% and 1.6% respectively. 2) In terms of supply and demand, the inventory of intermediate products remains low, the delay of shipping schedule still exists, the supply of raw materials remains tight, the demand for new energy continues to increase, and the price is expected to rise further.
4. Reshaping the pattern of rare earth permanent magnet industry. Following the interview with the Ministry of industry and information technology last week, the market was in a strong wait-and-see mood this week, and the enthusiasm of downstream inquiry was poor. The quotation of praseodymium and neodymium oxide in China fell by 3.6% to 1065000 yuan / ton; The price of dysprosium oxide decreased by 3.2%, and the price of terbium oxide decreased by 2.6% China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) in March, the listing price of praseodymium and neodymium oxide was 816000 yuan / ton, unchanged month on month. We believe that under the current supply and demand pattern, prices do not have the risk of falling sharply.
5. Nickel: LME staged a close position market, and the price hit a record high. The metal nickel inventory remained low, and LME nickel staged a tight position market. The LME nickel price once exceeded US $100000 / ton. Then, LME Exchange announced to suspend nickel trading and cancel all nickel trading on March 8. The salt factory settled with LME price as imported raw material faced huge losses, and the market inquiry and offer stalled. On March 9, Castle Peak said that it had allocated sufficient spot for delivery, with long and short reversal, and it is expected that the nickel price will gradually return to fundamentals.
Investment suggestion: maintain the “overweight” rating of the industry
1. Base metals: China’s economic work in 2022 is set to be “stable”. It is expected that the follow-up steady growth policies will be introduced continuously to support the confidence of base metal demand. However, from a global perspective, 1) changes in the structure before, during and after the outbreak of overseas economic demand, and 2) the tightening trend of overseas liquidity remains unchanged, which still suppresses the demand for base metals. In the short term, there is no doubt that the supply uncertainty caused by the conflict between Russia and Ukraine will have a direct impact on bulk commodities, and the sector will continue to be strong before the uncertainty between Russia and Ukraine. Next week we will focus on the US interest rate meeting.
2. The upstream raw materials of new energy, such as lithium cobalt rare earth copper foil, aluminum foil and magnetic materials, are still strong in the short cycle, and the general direction of the medium and long-term three-year boom upward cycle will not change. The industrial boom is the most clear and continues to be firmly optimistic.
Core marks: 1) core marks: 1) new energy vehicle industry chain: 1) new energy vehicle industry chain: 1) new energy vehicle industry chain: 1) new energy vehicle industry chain: (1) 1) that ” ”’ \ , Yantai Zhenghai Magnetic Material Co.Ltd(300224) , Jl Mag Rare-Earth Co.Ltd(300748) , Earth-Panda Advanced Magnetic Material Co.Ltd(688077) , Jiangsu Dingsheng New Material Joint-Stock Co.Ltd(603876) , Nuode Investment Co.Ltd(600110) , Guangdong Jiayuan Technology Co.Ltd(688388) etc. 2) Base metal: Yunnan Aluminium Co.Ltd(000807) , Henan Shenhuo Coal&Power Co.Ltd(000933) , Tianshan Aluminum Group Co.Ltd(002532) , Sunstone Development Co.Ltd(603612) , Zijin Mining Group Company Limited(601899) , Tongling Nonferrous Metals Group Co.Ltd(000630) , etc. 3) Precious metals: Shandong Gold Mining Co.Ltd(600547) , Shengda Resources Co.Ltd(000603) etc.
Risk tips: macroeconomic fluctuation, import and environmental protection policy risk, gold price fluctuation risk, lower than expected risk of new energy vehicle sales, lower than expected risk of premise assumption of supply and demand calculation, etc.
