Core view
1. Since March 2021, the price of Lun copper has continued to rise. As of April 1, 2022, LME copper spot closed at US $102695/t, up 17.5% compared with the low US $8740.0/t of LME copper price in 2021. The new energy industry continued to boom, driving the growth of copper demand. From the perspective of industrial chain, according to the data of Baichuan Yingfu, the downstream applications of copper mainly include power, household appliances, transportation, electronics and construction. At present, copper in the field of global transportation is growing rapidly. Under the background of “carbon neutrality”, the prosperity of the global new energy vehicle industry is continuously improving. According to ICSG statistics, the copper consumption of traditional vehicles is 23kg, that of plug-in hybrid electric vehicles is 60kg, and that of pure electric vehicles is 83kg. According to wind data, the global sales volume of new energy vehicles reached 6.75 million in 2021, a year-on-year increase of 108%. At the same time, the global penetration rate of new energy vehicles in 2021 is about 8.3%, which has great development space in the future. Copper for new energy vehicles will drive the overall demand for copper to continue to strengthen. The supply side has little impact, and the global copper supply is basically stable. With the gradual control of the epidemic, the global copper supply has basically recovered. According to the data of the U.S. Geological Survey, the global copper production in 2021 was about 21 million tons, an increase of about 1.9% over 2020; According to ICSG data, the global refined copper (primary + recycled) output in 2021 was about 24.855 million tons, an increase of about 1.4% over 2020. Global copper supply has recovered, but the overall growth rate is basically stable. Global copper supply and demand may maintain a tight balance, and copper prices are expected to fluctuate upward. In terms of supply, the global supply of copper and refined copper has increased, but the overall growth rate is low and the supply scale is basically stable. In terms of demand, with the increase of copper demand for new energy vehicles and the growth of its own scale, the demand for copper is expected to grow rapidly. In the future, the supply and demand of the copper industry may continue to be tight, and the copper price is expected to fluctuate upward.
\u3000\u30002. In the past week, most of the prices of major non-ferrous metals fell, with LME zinc up 6.4% and nickel down 16.1%. In terms of zinc, as of April 1, 2022, the price of LME zinc was reported at US $4332.0/ton, up 6.4% on a weekly basis. The main reason for the rapid rise of zinc price is that under the conflict between Russia and Ukraine, the natural gas price rises and the smelting cost of European zinc smelters is high; In terms of nickel, as of April 1, 2022, SHFE nickel price was reported at 221000 yuan / ton, down 16.1% week on week. The main reason for the decline of China’s nickel price is the game of Lun nickel capital, which leads to significant fluctuations in China’s nickel price.
\u3000\u30003. The official organization of the gold industry launched the gold traceability plan, and the gold price continued to fluctuate. On March 28, 2022, the World Gold Council released a news that it was cooperating with the London gold and silver Market Association to build a gold bar integrity. The project will use blockchain technology to realize the digital tracking of the whole supply chain from gold mine production to gold jewelry procurement. It is expected that the project will significantly improve the traceability of global gold, ensure the safety and controllability of the gold supply chain, and enhance the purchase confidence of downstream consumers and investors in gold. In terms of price, as of April 1, 2022, Comex gold futures closed at US $1947.2/oz, down 0.5% this week.
\u3000\u30004. Market review. In the past week, 9 of CITIC’s non-ferrous metal sub sectors fell. Among them, the top three sectors were other rare metals, lithium, rare earth and magnetic materials, with declines of – 3.8%, – 3.3% and – 2.8% respectively. In terms of individual stocks, the top three weekly gains were Tibet Huayu Mining Co.Ltd(601020) , Baoji Titanium Industry Co.Ltd(600456) , Yinbang Clad Material Co.Ltd(300337) , with weekly gains of 11.3%, 8.9% and 8.7% respectively; The top three weekly declines were Hoshine Silicon Industry Co.Ltd(603260) , Earth-Panda Advanced Magnetic Material Co.Ltd(688077) , Yunnan Lincang Xinyuan Germanium Industry Co.Ltd(002428) , with weekly declines of 11.4%, 11.3% and 11% respectively.
Investment advice
The global copper price continues to rise, and copper production enterprises may benefit, including Jiangxi Copper Company Limited(600362) , Ningbo Jintian Copper (Group) Co.Ltd(601609) , Yunnan Copper Co.Ltd(000878) , etc.
Risk tips
Copper supply exceeded expectations, the Fed accelerated the process of raising interest rates, and the expansion of new energy industry was less than expected.
