In February, the production and sales of new energy vehicles and power batteries met expectations, and the sharp rise in crude oil prices may benefit terminal demand
According to the China Automobile Association, in February, China’s automobile production and sales completed 1.813 million and 1.737 million respectively, down 25.2% and 31.4% month on month, with a year-on-year increase of 20.6% and 18.7% respectively. Due to the influence of the Spring Festival holiday, the month on month decline and year-on-year growth are due to the following reasons: first, the export of new energy and traditional vehicles has played a positive role in promoting; Second, inventory replenishment drives demand growth. In terms of new energy vehicles, a total of 334000 vehicles were sold in February, up 184.3% year-on-year. In terms of penetration rate, in February this year, the penetration rate of new energy vehicles was 16.1%, a year-on-year increase of 1.1 times. In February, the production and sales of new energy vehicles maintained a high-speed growth year-on-year. Specifically, the production and sales of pure electric vehicles in February were 271 / 246000, an increase of 1.5/1.7 times year-on-year respectively; The production and sales of plug-in hybrid vehicles were 8.275000 respectively, with a year-on-year increase of 4.1/3.4 times respectively.
According to China Shipbuilding Industry Group Power Co.Ltd(600482) battery alliance, the output and installed capacity of China Shipbuilding Industry Group Power Co.Ltd(600482) battery in February were 31.77/13.67gwh respectively, with a year-on-year increase of 236.2% / 145.1% and a month on month change of + 7.1% / – 15.5%. The seasonal decline of installed capacity in February is normal and in line with expectations. Among them, the installed capacity of lithium iron phosphate battery was 7.8gwh, a month on month decrease of 12.3%, a year-on-year increase of 247.3%, and the installed capacity accounted for 56.9%. In terms of cathode materials, according to SMM, ternary materials, lithium iron phosphate, lithium manganate and lithium cobalt oxide produced 47964 tons / 49596 tons / 6155 tons / 7327 tons respectively in February, with a month on month ratio of + 10.5% / – 7.0% / + 49.6% / + 10.2% and a year-on-year ratio of + 67.0% / + 97.5% / – 28.1% / – 9.8%.
Affected by the conflict between Russia and Ukraine, the recent sharp rise in crude oil prices may promote the global demand for new energy vehicles. As of March 11, the settlement price of Brent crude oil futures was reported at US $112.67/barrel, breaking the 100 yuan high for the first time in recent five years, far exceeding the median oil price of US $63.57/barrel in recent five years. The rise in crude oil prices has pushed up oil prices and further increased the use cost of fuel vehicles. China’s oil price has risen for five consecutive years this year, and the oil price of No. 95 in most regions will exceed 9 yuan / L. according to the calculation of 50 liters of single refueling and 100000 kilometers in five years, the power consumption of new energy electric vehicles can save nearly 80000 yuan compared with that of traditional vehicles. We expect that in the short term, the situation in Russia and Ukraine will be difficult to calm down, and the crude oil price will continue to run at a high level. We are optimistic about the acceleration of the global automobile electrification process.
Overall, benefiting from the rapid growth of production and sales of new energy terminals, the superposition of high crude oil prices, or the improvement of new energy penetration, may support the high operation of energy metal prices.
Suzhou Ta&A Ultra Clean Technology Co.Ltd(300390) plans to subscribe for the equity of premier and obtain the off take right of lithium concentrate of the feasibility study project, so as to further expand the layout of the resource side
Event: according to Premier’s announcement, Suzhou Ta&A Ultra Clean Technology Co.Ltd(300390) signed a contract with premier to subscribe for 3 billion new shares of premier at £ 12 million per share, accounting for 13.38% of its total shares after capital increase and share expansion. After subscribing for shares, Suzhou Ta&A Ultra Clean Technology Co.Ltd(300390) will obtain 50% off take right of all spodumene products of Zulu Lithium Tantalum project in feasibility study stage and irrevocable preemptive right within 180 days from the date of subscription.
Premier’s interests in minerals:
Premier has a number of mineral resources projects in South Africa, including Zulu lithium project and RHA tungsten project in Zimbabwe.
Resource reserves of Zulu Lithium Tantalum project:
According to Premier’s official website, Zulu Lithium Tantalum project is located about 80 kilometers away from Brava, Zimbabwe. The project is considered to be the largest undeveloped lithium bearing pegmatite in Zimbabwe. The Zulu project includes 14 mineral claims, covering an area of 3.5km2 and has the prospect of lithium and tantalum mineralization. According to Premier’s official website, the preliminary exploration estimates that the ore volume is 2010 million tons, and the average grade of Li2O is about 1.06%, which is converted into about 526000 tons of LCE. More than 65% of the 3.5km lithium ore belt of Zulu project has not been evaluated for lithium resources, and the exploration target of the main area is 60-80 million tons.
The price of lithium is high, and the discount coefficient of cobalt and nickel rises sharply
At present, the lithium price is strong and is still breaking the record high. At present, the single ton price of SMM lithium carbonate has exceeded 500000 yuan / ton. The average price in February increased by 27.7% month on month and 462.6% year-on-year compared with January. In addition, according to SMM, the current pricing rules for waste ternary power batteries are: (SMM electrolytic nickel price) × Nickel content% + SMM electrolytic cobalt price × Cobalt content (%) × Discount factor%. Since 2021, the discount coefficient has been rising all the way. According to SMM, at present, the black powder coefficient of ternary 523 pole chip & battery has reached 120.5%, up 10.6% month on month, up 56.5% compared with the new index since July 2021. Mainly: on the supply side, the retirement wave of waste power batteries has not really arrived, and the supply side of the overall market is still tight; On the demand side, the demand for new energy is considerable, and the supply of primary lithium resources is tight. Recycling, as an important supply supplement, has attracted the attention of the market and policies. At the same time, new production lines for recycling and treatment have been put into operation one after another, and the overall demand is strong.
Risk warning: the release of supply is higher than expected, the demand is lower than expected, and the macro-economy fluctuates sharply
