Report summary:
The 154 environmental protection and public utility stocks we tracked lost 1.72 percentage points to the Shanghai index this week and outperformed the Shanghai index by 14.88 percentage points since the beginning of the year. This week, Lingda Group Co.Ltd(300125) , Huadian Energy Company Limited(600726) , Hunan Chendian International Development Co.Ltd(600969) increased by 12.65%, 10.53% and 7.91% respectively, showing good performance Nanjing Public Utilities Development Co.Ltd(000421) , Jiangsu Jiuwu Hi-Tech Co.Ltd(300631) , Yonker Environmental Protection Co.Ltd(300187) decreased by 17.04%, 14.15% and 12.92% respectively, showing poor performance.
The epidemic affected downstream construction, and the price of lithium salt in China fell.
This week, the price of lithium salt in China fell. Among them, the decline of lithium carbonate is greater than that of lithium hydroxide. We judge that the upgrading of epidemic prevention measures in Shanghai and other places, the main production area of the new energy vehicle industry chain, has led to the shutdown of some vehicle enterprises and battery enterprises, and the downstream demand has been significantly weakened. At the same time, in terms of supply, the temperature rebounded, the output of lithium carbonate in Qinghai recovered, and the supply increased month on month, resulting in a decline in prices. The overhaul of major lithium hydroxide plants continues, and the current production capacity has not been restored, and the market supply is tight, so the price is stronger than that of lithium carbonate. In the short term, due to the continuous weakening of the procurement demand of downstream material plants, the price of lithium salt in China still has a downward trend. However, considering the substantial increase in the price of lithium concentrate in the second quarter, the cost will support the high price of lithium salt, especially the lithium hydroxide processing line with spodumene as raw material. Therefore, we judge that the price of lithium salt will be under pressure in the short term, but with the improvement of the epidemic situation and the gradual recovery of downstream construction, the price will remain high.
The output of Q1 lithium concentrate of Australian enterprises fell month on month, and the average selling price of allkemq2 was US $5000 / ton.
On April 14, the evaluation price of fastmarkets lithium concentrate was USD 5750 / ton, which remained unchanged compared with the quotation on March 31. On April 15, Platts energy information estimated that the price of lithium concentrate (SC6) remained at US $5350 / ton (FOB, Australia), unchanged month on month. On April 12, Pilbara announced the production and operation of spodumene concentrate in the first quarter. The output of spodumene concentrate in 2022q1 was 81431 tons, a decrease of 2.45% compared with 2021q4 (83476 tons), which was within the guidance range of 75 Xiandai Investment Co.Ltd(000900) 00 tons. The total shipment volume of Q1 was 58383 tons, a decrease of 25.80% compared with 2021q4 (78679 tons). Due to berth access restrictions, the original plan to ship about 20000 tons of goods at the end of March was delayed to leave Hedland port on April 7. The average sales price of Q1 was 2650 US dollars / ton, an increase of 47.22% over 2021q4 (1800 US dollars). Including the sales volume of 2021q4 shipped in 2022q1. On April 14, allkem released its first quarter production and operation report. The company produced 48562 tons of spodumene concentrate in 2022q1, a decrease of 7.01% compared with 52225 tons in 2021q4, and shipped 66011 tons of lithium concentrate, an increase of 73.39% compared with 2021q4, including the sales volume in the fourth quarter. The average selling price of 2022q1mtcattlin is 2178 US dollars / ton, the pricing of 2022q2 is about 5000 US dollars / ton (cif6%), and the sales volume is about 50000 tons. The processing cost of lithium carbonate corresponding to spodumene concentrate of 5000 US dollars / ton is 320000 yuan / ton. The long-term cooperative price of lithium concentrate in 2022q2 is doubled compared with that in 2022q1, which greatly increases the raw material cost of non integrated lithium salt processing enterprises. At present, due to the long development cycle of mines at home and abroad and the slow overall progress, the supply growth rate of lithium concentrate is less than that of demand. We judge that the long-term association price of 2022q3 lithium concentrate will continue to rise sharply month on month. The cost of processing plants using spodumene to process lithium salt will continue to rise. Even after a short-term correction under the impact of the epidemic, the price of lithium salt will still rise to a high level.
The power consumption of the whole society continued to grow, and the power consumption of the secondary industry increased by 27.53% month on month compared with February.
In February, China’s electricity consumption continued to grow by 693.5% year-on-year, reaching 693.5% year-on-year. By industry, the power consumption of the primary industry was 7.8 billion kwh, an increase of 12.3% year-on-year and 1.3% month on month; The electricity consumption of the secondary industry was 479 billion kwh, an increase of 2.3% year-on-year and 27.53% month on month; The electricity consumption of the tertiary industry was 106.3 billion kwh, an increase of 4.0% year-on-year and a decrease of 10.07% month on month; The domestic electricity consumption of urban and rural residents was 101.3 billion kwh, an increase of 8.8% year-on-year and a decrease of 16.97% month on month. The primary and secondary industries grew month on month, and the power consumption of the tertiary industry and urban and rural residents decreased significantly month on month in February. From January to March, the total electricity consumption of the whole society was 2042.3 billion kwh, a year-on-year increase of 5.0%. In terms of industries, the domestic power consumption of the primary industry and urban and rural residents maintained a rapid growth, with double-digit growth. Among them, the power consumption of the primary industry was 24.1 billion kwh, a year-on-year increase of 12.6%; The electricity consumption of the secondary industry was 132.14 billion kwh, a year-on-year increase of 3.0%; The electricity consumption of the tertiary industry was 355.1 billion kwh, a year-on-year increase of 6.2%; The domestic electricity consumption of urban and rural residents was 341.7 billion kwh, a year-on-year increase of 11.8%.
China Shipbuilding Industry Group Power Co.Ltd(600482) coal prices continue to decline, and the short-term price will continue to maintain a downward trend.
The price of China Shipbuilding Industry Group Power Co.Ltd(600482) coal continued to decline this week. In terms of origin, at present, most coal mines in China maintain normal production, and the mainstream large mines mainly cash in the long-term association, with little inventory pressure. Coal mines that mainly sell coal in the market have slowed down their shipment speed. At present, the operation of downstream chemical and other non power industries is not ideal, the demand for coal consumption is weak, and the wait-and-see mood is strong; At the same time, the port coal price is down, the platform traders are also more, the shipping enthusiasm is not high, the coal mine inventory is rising, and the price is reduced to stimulate sales. In terms of ports, the price of thermal coal in northern ports fell this week, and the actual transaction in the market was limited. In recent years, the downstream industries in some parts of East China have not started well, the demand for coal is weak, the end users mostly stay on the sidelines, and the price of a small number of inquiries is low; At the same time, the coal price at the place of origin is under pressure, which also weakens the support for the cost of underground coal, and the overall port coal price is dominated by the following behavior. In terms of downstream demand, China’s downstream demand is weak this week, and end users have a strong wait-and-see mood. The temperature has picked up recently, and the operation of some downstream industries is not ideal, the power for increasing the daily consumption of power plants is insufficient, and the enthusiasm for purchasing coal in the market under the guarantee of the long-term association is not high; At the same time, the start-up of non power industries such as chemical industry and cement in some areas is limited, and the coal consumption demand of non power users has also declined. We judge that the short-term price will still maintain a downward trend.
The average price of LNG in China was reduced by shock, and the price of natural gas in the United States continued to rise.
This week, China’s average LNG price fluctuated and decreased. In terms of supply, China’s LNG output decreased month on month, and the arrival volume of sea and gas and the shipment volume of tank batch decreased significantly month on month; In terms of demand, the current market is still significantly affected by traffic restrictions. The liquid level of the liquid plant increases gradually, which can only stimulate shipments by reducing prices. The flow of resources from the north to East, central and South China markets increases. With the good news about transportation in the market, it will continue to benefit the terminal procurement demand. LNG supply may decline in a narrow range next week, and the demand may remain depressed. Zhuo Chuang information expects that the LNG price may gradually stabilize in the short term. In this cycle, as the temperature in the region is lower than the average level of previous years, the demand for heating and power plants in the downstream of the market increases, and the market reserve inventory continues to decline. The market’s concern about the future winter natural gas reserve intensifies, driving the rise of the price of American natural gas futures. Internationally, due to the increased sanctions on Russian oil and gas, the United States and some parts of Europe prohibit the import of Russian oil and gas energy, The focus of market supply is inclined to the United States, driving the spot price of natural gas in the United States.
Investment advice
The long-term association price of 2022q2 lithium concentrate has reached $5000 / ton, and the cost of lithium salt has reached 320000 yuan / ton. In the context of tight supply and demand, we expect the price of Q3 Australian lithium concentrate to rise further, and lithium salt is difficult to callback under the support of high cost. As early as the beginning of 2021, pilbaraminerals, which sold lithium concentrate overseas, and Galaxy resources, which had not been merged at that time, publicly stated that the upstream resource side was the strongest in this round of shortage, and advocated that the downstream processing of upstream resources should be a profit sharing model of 73%. In 2021, due to the price rise of lithium carbonate in China one quarter earlier than that of overseas lithium concentrate and the inventory effect of lithium concentrate, the single ton profit of processing plants and integrated enterprises did not show very differentiation. However, in 2022, especially q2-3 in 2022, it is difficult for China to have lithium concentrate inventory to dilute the cost of externally extracted lithium concentrate. At the same time, the long-term agreement price of 2022q2-3 lithium concentrate will rise sharply. In these two quarters, under the condition of high fluctuation of lithium salt price, the profit differentiation per ton of lithium salt processing plants and integrated enterprises will become more and more obvious. It is suggested to pay attention to the enterprises integrating upstream and downstream. It is recommended to pay attention to the mining and beneficiation project of Lijiagou spodumene mine under construction. In the future, [ Sichuan New Energy Power Company Limited(000155) ], which will work with Dagu Dongchuan energy investment to integrate and develop lithium resources in Ganzi and ABA, will benefit from [ Tianqi Lithium Corporation(002466) ], which has been increasing production in the next five years and can achieve large-scale output through OEM, and [ Youngy Co.Ltd(002192) ], which is promoting the 2.5 million T / a lithium ore beneficiation project in yuanyangba, with rich reserves of lithium mica resources, [ Jiangxi Special Electric Motor Co.Ltd(002176) ] is being processed for the exploration and mining of Xikeng lithium mica mine. Due to the rapid growth of new energy structure, operators are expected to benefit from the thickening of new energy structure and the improvement of new energy efficiency. We recommend paying attention to the new energy target of thermal power transformation [ Huaneng Power International Inc(600011) ]; At the same time, [ Cecep Solar Energy Co.Ltd(000591) ], [ Cecep Wind-Power Corporation(601016) ], and the Hong Kong stock targets benefiting from the new energy operation include [Longyuan Power], [China Resources Power] and [China power].
Risk tips
1) the implementation of carbon neutralization related policies is less than expected;
2) the demand for power coal and natural gas decreases seasonally;
3) major changes in power policy;
4) the development progress of lithium mine in Sichuan is less than expected.
