Key investment points:
The marginal demand for copper and aluminum improved, and the consumption recovered further after the epidemic. This week, the pace of removing copper and aluminum from China’s social inventory was accelerated compared with that in the early stage, the marginal of the downstream affected by the epidemic weakened, the operating rate increased month on month, and the internal and external price comparison converged slightly. In the short term, with the gradual weakening of the impact of the epidemic in China, the recovery of downstream production and the superposition of steady growth policies to further promote the demand for industrial metals, China’s fundamentals continue to repair, and the internal and external price difference may be further narrowed through the rise of China’s metal prices.
Macroscopically, this week, the Federal Reserve released the expectation of raising interest rates in May, and LME copper prices are now callback. However, before the overseas energy problems are solved, the prices of high energy consuming metals such as aluminum and zinc still have strong cost support.
Industrial metals
Copper: China has accelerated the removal of copper from the warehouse, and the internal and external price comparison has been repaired. The social inventory of copper in China has decreased by 12300 tons to 127300 tons month on month. The pace of removal from the warehouse is significantly faster than that in the early stage. The operating rate in the downstream has been repaired month on month, and the impact margin of the epidemic has been reduced. The internal and external price comparison has been somewhat repaired compared with that in early April, and the loss of refined copper import has narrowed. With the gradual emergence of the effect of epidemic control in the future, it is expected that the downstream consumption will accelerate the recovery progress.
Aluminum: China’s electrolytic aluminum went out of the warehouse significantly, and the pattern of strong and weak inside continued. On April 21, China’s electrolytic aluminum social inventory went out of the warehouse from 42000 tons to 1021000 tons month on month. Affected by the resumption of vehicle and parts enterprises, the resumption of aluminum downstream has increased, the inventory of processed materials such as aluminum rods has further decreased, the willingness of downstream enterprises to prepare goods has increased, and the consumption margin of electrolytic aluminum has improved.
Overseas performance remains strong. LME electrolytic aluminum inventory continues to go to less than Shanghai Pudong Development Bank Co.Ltd(600000) tons. Aluminum export profits are higher month on month. It is expected that aluminum will be exported overseas in the form of aluminum in the short term.
Zinc: European stocks continue to decline, Chinese consumption is still limited, and the Chinese epidemic continues to affect the downstream consumption of refined zinc. The inventory of refined zinc in Chinese society is only slightly removed from the warehouse, ranging from 05000 tons to 283600 tons, and the operating rate of downstream zinc plating and die-casting alloy continues to decline. In terms of raw materials, the current supply of Chinese mines is still relatively tight. Under the pattern of external strength and internal weakness, the imported mines decreased in March, and the tight situation of raw materials may still be maintained.
Overseas, the European LME inventory continues to decline to 425 tons. At present, the logic of strong support for LME zinc price by European low inventory continues to deduce. The price comparison has converged month on month, but the overall price is still high. In the follow-up, we need to pay attention to the export of refined zinc.
Precious metals
Gold: the anti inflation attribute of gold highlights that the allocation value continues to rise. This week, the Federal Reserve released the expectation of raising interest rates in May, the real yield of US bonds rose, Comex gold price fell somewhat, but it is still at a high level, and ETF positions continue to rise. At present, the anti inflation attribute of gold is prominent, and the allocation value continues to rise.
Investment suggestion: it is suggested to pay attention to Yunnan Chihong Zinc & Germanium Co.Ltd(600497) , Henan Mingtai Al.Industrial Co.Ltd(601677) , Yunnan Aluminium Co.Ltd(000807) , Chifeng Jilong Gold Mining Co.Ltd(600988) , Shandong Gold Mining Co.Ltd(600547) .
Risk tips: Overseas geopolitical risks; Supply has increased more than expected; The demand is less than expected.
