Industrial metals: foreign Federal Reserve raised interest rates, the US dollar index and US bond yield both fell, the fear of raising interest rates converged, and the price of industrial metals rebounded. In China, the Bureau of statistics released the economic operation data from January to February this week. Among them, the manufacturing investment increased by 20.9% year-on-year, the infrastructure investment increased by 8.1% year-on-year, and the real estate investment increased by 3.7% year-on-year. In addition, the intensity of fiscal expenditure is relatively large, and public fiscal expenditure increased by 7% year-on-year, the highest growth rate since 2010. The amount of special debt began to increase, and the proportion of special debt to infrastructure increased significantly. On March 16, the Finance Committee of the State Council held a special meeting and stated that it was prudent to introduce contraction policies. China’s steady growth expectation continued to strengthen, and the demand for industrial metals may continue to improve. It is suggested to pay attention to: Zijin Mining Group Company Limited(601899) , Henan Shenhuo Coal&Power Co.Ltd(000933) , Shandong Nanshan Aluminium Co.Ltd(600219) , Western Mining Co.Ltd(601168) , Yunnan Tin Co.Ltd(000960) , etc.
Copper: the Fed’s interest rate hike is expected to fall, and China’s consumption recovery has started to destock
LME copper closed at US $10306 / ton, up about 2.03% during the week. From the perspective of fundamentals, SMM’s national copper inventory decreased by 34400 tons to 172500 tons month on month, and the recovery of consumption accelerated. The supply side is affected by the epidemic, the transportation is limited, the superimposed import remains closed, and the supply of scrap copper is tight, which hedges the inhibition of high prices on consumption to a certain extent, and the fundamentals support the maintenance of high copper prices.
Aluminum: electrolytic aluminum rods were removed from the warehouse, and low inventory supported the high shock of aluminum price
LME aluminum closed at US $3388 / ton, down about 2.64% during the week. Basically, SMM’s national electrolytic aluminum social inventory decreased by 53000 tons to 1089000 tons month on month, and aluminum rod inventory decreased by 18400 tons to 190000 tons month on month. This week, electrolytic aluminum rods will be put into storage. According to SMM, at the time of the weakness of futures aluminum, the downstream has increased the preparation of goods, the spot transaction is active, and it is expected to continue to go to the warehouse in the short term. In terms of profit, the price of raw aluminum oxide and prebaked anode for electrolytic aluminum operated stably this week, and the power coal tended to be stable under the government’s policy of firmly controlling the price and expanding production and ensuring supply. The profit of self provided electric electrolytic aluminum plant purchasing aluminum oxide maintained a profit level of 3500 yuan / ton, and the profit of electrolytic aluminum plant is expected to remain high.
Tin: the tension at the mine end continues, and the tin price is adjusted at a high level
LME tin closed at US $42120 / ton, down 4.81% from last week. According to SMM, this week, the production end was disturbed by the epidemic, the operating rate fell slightly, the mine end continued to be tight, and the inflow of imported ore was limited under the continuous closure and control of Myanmar mine. The demand side is limited by the impact of the epidemic in the short term, but the market remains optimistic about future consumption expectations. SMM’s national tin ingot inventory has decreased significantly from 1630 tons to 3201 tons month on month. The sharp decline in inventory indicates that after the decline of tin price, the high price in the early stage is restrained, the demand is released intensively, and the tin price is adjusted at a high level in the short term.
Zinc: slow resumption of overseas production and high zinc price
Zinc closed at US $380 / ton, up 23.0% from US $380 / ton last week. This week, overseas nyrstar indicated that it planned to gradually resume its French smelters, which had an impact on the zinc price, but the macro bearishness made every effort to hedge the bearishness. Before the overseas energy price was fundamentally solved, the probability of resumption of production of other smelters was low, and the zinc price remained high. In terms of China’s fundamentals, SMM’s national zinc ingot inventory decreased by 9000 tons to 276200 tons month on month. Downstream enterprises started to resume work and production. Although there was no significant growth bright spot, inventories still fell month on month. The stable growth policy in the future may promote the recovery of real estate and infrastructure and drive the high operation of zinc prices.
Energy metals: this week, Byd Company Limited(002594) and Tesla raised their selling prices one after another to convey the pressure of rising costs to the terminal. The Ministry of industry and information technology held a symposium on the operation of lithium industry and the price rise of upstream materials of power batteries. The meeting required upstream and downstream enterprises in the industrial chain to strengthen the connection between supply and demand, strengthen efforts to ensure market supply, and better support the healthy development of strategic emerging industries such as Shanxi Guoxin Energy Corporation Limited(600617) automobile. It is expected that in the future, with the end of the nickel short market, the nickel price will gradually return to the fundamentals, the supply of lithium resources will be gradually released, the terminal demand of new energy may accelerate, and the demand for energy metals may be boosted. It is suggested to be followed by the following: followingthe following of the following: followingthe following of the following: followingthe following of the , Zhejiang Huayou Cobalt Co.Ltd(603799) , Chengtun Mining Group Co.Ltd(600711) , China Molybdenum Co.Ltd(603993) , Nanjing Hanrui Cobalt Co.Ltd(300618) , etc.
Lithium: the price is running at a high level, and the contradiction between supply and demand is difficult to alleviate in the short term
Lithium prices were running at a high level this week. Battery grade lithium carbonate was 503000 yuan / ton, with a weekly increase of 0.2%, and battery grade lithium hydroxide was 489500 yuan / ton, with a weekly increase of 1.9%. On the supply side, due to the obstruction of the manufacturer’s commencement, the output increment is not obvious, and the market supply is tight. On the demand side, there is a strong demand for downstream products such as ternary materials and lithium iron phosphate, and the heat of new energy at the terminal is not reduced. In the short term, the supply and demand sides support the high price of lithium carbonate. The demand side performed well. The increment of high nickel orders led to the increase of lithium hydroxide procurement demand, and the focus of market negotiation rose steadily.
Cobalt: the import of cobalt raw materials is limited, and the price of cobalt rises slightly
This week, the price of electrolytic cobalt in China was 568500 yuan / ton, down 0.9% month on month. Electrolytic cobalt spot fell slightly this week. According to the steel union, China’s inventory fell 29 tons to 2978 tons month on month this week. The hedging action of pallets in this cycle led to the decline of cobalt price in the future, together with the slight fluctuation of spot price and bargain hunting and replenishment in the downstream market. On the demand side, due to the recent fluctuation of nickel varieties, the downstream precursor manufacturers have poor willingness to purchase, mostly just in need and mainly long orders. Overall, the impact of nickel price is gradually fading, the demand is gradually repaired, and the short-term supply of cobalt raw materials is tight or supports the high price of cobalt.
Nickel: the risk of closing positions has weakened, and the nickel price has gradually dropped
Nickel prices fell this week, with LME nickel closing at US $36915 / ton, up 23.15% on a weekly basis. Under the multiple measures of LME, the risk of closing positions has been basically resolved, and the nickel price is gradually returning to the fundamental direction. In the spot market, the correction of nickel price has improved the market trading mood, and there are a lot of short-term transactions. According to CISC, compared with before the sharp rise of nickel price, the cost of nickel sulfate produced by nickel bean processing technology increased by 69.78%, and the cost of nickel sulfate produced by nickel hydroxide processing technology increased by 59.12%. However, the price of nickel sulfate increased by only 18%, and it was difficult for battery grade nickel sulfate to follow up, which was at a discount to the first grade nickel. The production cost of nickel sulfate is high, and the production of precursor plant is under pressure. Nickel sulfate production may need to rely on waste supplement.
Precious metals: the Federal Reserve raised interest rates and fell, while gold prices fell
COMEX gold closed at $1921.5 an ounce this week, down 3.55% from last week. COMEX silver futures closed at $25.14 an ounce, down 4.13% from last week. On March 17, the Federal Reserve officially announced its interest rate resolution for March, announcing a 25 basis point increase in interest rates, and the target interest rate range of federal funds rose to 0.25-0.50%, in line with market expectations.
The US dollar index fluctuated down to 98.02 on the day when the interest rate increase was announced, and rose 0.21% to 98.23 the next day. Gold futures prices rose first and then fell, falling by US $21.7/oz on March 18 compared with the previous day. US Federal Reserve Chairman Powell said that he would announce the reduction of the table as soon as may and speed up the tightening of policy if necessary. According to the dot matrix chart of the latest interest rate increase path of the Federal Reserve, on average, policymakers expect to raise interest rates six times this year. Officials at the meeting agreed that interest rates are expected to rise to more than 1.25% this year, but some officials proposed that they could rise to a high of 3% to 3.25% this year. A series of radical measures indicate that the Fed has fully turned to the anti inflation model, or will continue to benefit the US dollar index, increase the cost of holding gold, and promote the continuous decline of gold prices.
Rare earth: the high price of rare earth fluctuated and adjusted, and the future consumption expectation was better
This week, the price of praseodymium and neodymium oxide was 1.035 million yuan / ton, down 3.72% from last week. The price of rare earths continued to decline, while downstream businesses mainly waited and waited, purchased cautiously, just needed replenishment, and the overall price was adjusted weakly. On the supply side, although the indicators have increased, the waste supply is tight, the epidemic is disturbed, the number of imported Myanmar mines has decreased, the total supply of rare earth mines is difficult to increase significantly in the short term, and the tight balance between supply and demand continues. On the demand side, in the process of price decline, businesses delay placing orders. In the long run, Nd-Fe-B enterprises expand production, the development trend of new energy and industrial motors is good, and the future consumption growth is expected to be better. It is suggested to pay attention to: China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) , Jl Mag Rare-Earth Co.Ltd(300748) etc.
Risk tips:
Metal prices fluctuated sharply, the demand for new energy fell sharply, and the macroeconomic performance was lower than expected
