On May 20, Ganfeng Lithium Co.Ltd(002460) announced that the company signed a framework share subscription agreement with Simei Resources Holdings Co., Ltd. (hereinafter referred to as “Simei resources”) and China Galaxy Securities Co.Ltd(601881) International Securities (Hong Kong) Co., Ltd. (hereinafter referred to as ” China Galaxy Securities Co.Ltd(601881) “) through its wholly-owned subsidiary GFL investment (Hong Kong) Limited (hereinafter referred to as “GFL investment”), GFL investment plans to subscribe for 60 million new shares issued by Shimei resources at the price of HK $4.0 per share, with a total amount of equity subscription of about HK $240 million. After the completion of this transaction, GFL investment will hold about 16.7% of the shares of Simei resources.
” Ganfeng Lithium Co.Ltd(002460) is currently the leading lithium resource supplier in the industry, but at present, the company’s raw material self-sufficiency rate is low. If the raw material self-sufficiency rate is planned to reach more than 70% by 2025, it is necessary to acquire various mines.” Zhang Xiang, President of the New Energy Vehicle Technology Research Institute of Jiangxi new energy technology vocational college, said in an interview with the reporter of Securities Daily, “tantalum niobium ore and lithium ore are associated minerals, Ganfeng Lithium Co.Ltd(002460) if you hold the shares of Rare American resources, you will have a certain voice, which is equivalent to mastering part of lithium resources and rare metal resources.”
Companies with high self-sufficiency rate of raw materials, such as Jiangxi Special Electric Motor Co.Ltd(002176) , can mine their own lithium porcelain stone, extract the main product lithium mica from lithium porcelain stone, and extract feldspar powder, tantalum niobium and other by-products, so as to realize the comprehensive utilization of lithium ore mining and beneficiation.
As for Shimei resources, it has long had the idea of entering the core raw material industry of lithium batteries. At the end of last year, the company plans to establish a joint venture to invest in the project of 50000 ton battery grade lithium salt circular economy industrial park. At present, niobium products, one of the main products, can be used as cathode mixed materials to improve electronic conductivity and stability.
Statistics show that Shimei resources, founded in 2006, is a listed company on the main board of Hong Kong. It is the world’s leading operator of tantalum and niobium products. Its main products include wet products such as tantalum oxide, niobium oxide and potassium fluotantalate, as well as pyrotechnical products such as tantalum powder, tantalum strip, niobium strip and ferroniobium. The market share of wet products in China in recent years is more than 30%. By the end of 2021, the audited total assets of the company were 1.082 billion yuan, the net assets were 623 million yuan, and the annual operating income was 764 million yuan and the net profit was 102 million yuan.
In recent years, with the rapid development of downstream industries, 5g network infrastructure, electric vehicles, fast charging, semiconductors, chips and other fields have ushered in explosive growth, driving the rapid development of upstream tantalum niobium industry, and the R & D and production of relevant high-tech products have entered a new growth cycle.
At present, A-share listed companies involving the concept of rare metals such as tantalum and niobium include Ningxia Orient Tantalum Industry Co.Ltd(000962) , Jiangxi Guotai Group Co.Ltd(603977) , etc. An insider who asked not to be named told the Securities Daily that China’s low-end tantalum niobium product manufacturers have strong production capacity. However, subject to the continuous rise of raw materials and labor costs and the continuous increase of environmental protection costs, their profit space is gradually narrowing and the industry is facing in-depth adjustment. With the development of 5g commercial and high-end equipment manufacturing, the demand for tantalum and niobium in communication, electronics, automobile, new military materials and other application fields will show a restorative growth.
The reporter noted that the gross profit margin of tantalum niobium oxide products was generally about 15% – 23% last year. How to promote the high-end development of tantalum niobium products is an urgent problem to be solved. “Jiangxi Sanshi Nonferrous Metals Co., Ltd., the holding subsidiary of the company, focuses on the layout of high-end products of tantalum niobium compounds, including electronic grade potassium fluotantalate required for tantalum capacitors, ultra-high-purity niobium oxide required for filters, high-purity niobium oxide required for automatic driving HD cameras and battery grade niobium oxide for new energy vehicles. The design annual capacity is 1000 tons of tantalum niobium compounds, and trial production is expected to start in the middle of this year.” Earlier, Jiangxi Guotai Group Co.Ltd(603977) said in an investor survey.
