Energy Metals are optimistic about the Price of Cobalt and Lithium [Agency Review]

SMM survey: what kind of metal do you like most in 2022?

This week (12.13-12.17) non-ferrous metals outperformed the market, down 3.81%. Among the sub-plates, the gold plate had the biggest increase, with an increase of 1.15%. In addition, the top three declines were other non-metallic material plates, non-ferrous metals plates, and other rare and small metal plates, with decreases of 6.20%, 3.81% and 3.75%, respectively.

Basic metal

Base metals this week (12.13-12.17) the overall weak operation of the current market. Futures market: LME aluminum, zinc and lead rose 4.69%, 2.45% and 0.41% compared with the same period last week; copper, tin and nickel fell 0.08%, 2.04% and 1.08% compared with the same period last week. The overall price of basic metals in the domestic spot market is strong, with aluminum, zinc, lead and nickel rising 3.41%, 2.28%, 1.29% and 1.64% respectively; copper is down 0.47% from last week; and tin is basically the same as last week. Copper: a slight correction in copper prices this week.

Supply-side disturbance continued, Las Bambas mine production was suspended due to community transportation and the depletion of key consumables, which affected the spot market supply of copper concentrate in the short term. On the demand side, the domestic market has entered long order transactions at the end of the year, and spot buying and selling sentiment is still relatively low. On the inventory side, SHFE copper stocks were about 34600 tonnes, down 16.43 per cent from the same period last week. Aluminum: aluminum prices are on an upward trend this week, up 4% from the same period last week. The supply side is still restricted by policy factors such as double control of energy consumption and environmental protection, and the operating capacity of domestic electrolytic aluminum remains low. On the demand side, the downstream operating rate has increased, and the market demand has improved. This week, the market price of alumina decreased to ease the pressure on the production cost of electrolytic aluminum, and the profit level of electrolytic aluminum rebounded. On the inventory side, SHFE aluminium stocks stood at 330500 tonnes as of Friday, up 2.84 per cent from the same period last week. Supply is tight, demand is picking up, and aluminum prices are bullish. Suggested attention: Zijin Mining, Luoyang Molybdenum Industry, Yunnan Aluminum Co., Ltd., Shenhuo Co., Ltd., Nanshan Aluminum Co., Ltd., Mingtai Aluminum Co., Ltd.

New energy metal

This week (12.13-12.17) the price of new energy metals is more divergent. Cobalt: cobalt prices have risen steadily this week. As of Friday, the spot cobalt price in the Yangtze River was 4880,000 yuan / ton, up 1.24% from last week. The price of cobalt salt showed an upward trend as a whole. The price of cobalt sulfate was 1010,000 yuan / ton, up 6.88% from last week, and the price of cobalt tetroxide was 3825,000 yuan / ton, up 9.13% from last week. The spread of the epidemic in South Africa has affected the delay of shipping to Hong Kong, the shortage of raw materials has not abated, and cobalt prices continue to rise. The import supply of domestic cobalt raw materials has been tightened and the operating rate of cobalt salt plants in Zhejiang has been reduced, and the spot inventory of cobalt salt has been tight, stimulating short-term prices to rise. Lithium: the lithium salt market has maintained a stable operation this week, and the price of lithium salt has risen slightly. As of Friday, the price of lithium carbonate was 225,000 yuan / ton, up 8.54% from the same period last week; the price of lithium hydroxide was 189500 yuan / ton, basically the same as last week. The gas restriction policy in winter heating season in Qinghai has a certain impact on the local salt lake production, and the tight situation of domestic lithium salt supply remains unchanged. At the same time, terminal demand continues to be high, with domestic production and sales of new energy vehicles reaching a record high from January to November this year, with a cumulative output of more than 3 million. In the context of the continuous expansion of production and marketing of new energy vehicles, the market demand for lithium salt continues to improve, and lithium prices are expected to remain high. It is suggested to focus on: Huayou Cobalt Industry and Hanrui Cobalt Industry, which are the targets of the integrated layout of cobalt industry; Ganfeng Lithium Industry, Tianqi Lithium Industry, the leading enterprises with high self-sufficiency rate of lithium resources; Salt Lake Lithium related targets: salt Lake shares, Tibet Everest, Tibet Mining, medium Mine Resources; Lithium Mica related targets: Yongxing Materials, Jiangdian Special Machinery; spodumene related targets: Sichuan Energy Power.

Precious metal

This week (12.13-12.17) the overall operation of precious metals is strong, and prices are stronger again. Gold: as of Friday (12.17), COMEX gold was up 0.87% from last week at $1798.6 an ounce, while spot gold in London was up 1.57% at $1807.7 an ounce. Silver: COMEX silver price is US $22.36 / oz, up 0.65% from last week; spot silver price in London is US $22.65 / oz, up 3.43%. The Federal Reserve announced at its meeting this week that the Taper would accelerate and the Fed would cut back on bond purchases by $30 billion a month. The US index pushed higher and gold prices strengthened again. Inflation has remained high recently, market expectations for early interest rate increases have increased, and gold prices are expected to remain volatile in the short term. Suggested attention: Chifeng Gold, Yintai Gold, Shengda Resources.

Risk hint

The demand is lower than expected; the upstream mine exceeds the expected supply; the risk of policy change.