The rising trend of rare earths alleviates the strong upward trend in the prices of lithium sources and cathode materials [institutional review]

Core points:

Last week, various sectors of the new materials industry continued to rebound, led by lithium and photovoltaic materials. Sector valuations (TTM) continue to rise, while carbon fiber and panel materials are still below the long-term historical median.

Last week, various sectors of the industry continued to rebound, with photovoltaic materials and lithium materials leading the rise, with weekly increases of 9.78% and 6.65% respectively, outperforming the benchmark (Shanghai and Shenzhen 300) 11.45pct and 8.32 pct. The weekly increases of semiconductor, magnetic, carbon fiber and panel materials were 5.61%, 5.34%, 4.31% and 2.32%, respectively, outperforming the benchmark 7.28pct, 7.01pct, 5.99pct and 3.99 pct., respectively. Last week, the valuation level of magnetic materials, carbon fiber, lithium materials, photovoltaic materials and semiconductor materials (TTM) rose 2.5x, 2.6x, 2.6x, 4.4x and 3.7x to 42.9x, 57.9x, 64.4x, 53.5x and 65.7x, respectively, while the panel showed that the material valuation level rebounded slightly from 22.9x to 23.3x. From the historical quantile of valuation level, the valuation of magnetic material plate and panel material plate is still lower than the long-term median level.

Praseodymium and neodymium prices fluctuate at a high level, and the industry's weekly average gross margin changes little. The price of heavy rare earths fell after rising, while the price of terbium continued to rise. Cobalt prices continue to hit new highs, ferroboron and ferroniobium alloys are stable, and gallium prices continue to rise. The cost of rare earth raw materials is strongly supported, and the price of sintered NdFeB magnetic blank goes up slightly.

Praseodymium-neodymium: last week, the high level of praseodymium-neodymium market shock finishing, the national average price of praseodymium-neodymium oxide is 1.1 million yuan / ton, up 0.46%; praseodymium-neodymium metal average price is 136.3 yuan / ton, up 0.22% Last week, the market atmosphere of praseodymium and neodymium was weak, but the quotation was high and firm, the purchase order of metal factories was slow, the mentality of some traders was unstable, the overall transaction performance was general, and the supply and demand side stalemate game. Downstream magnetic materials enterprises are under great financial pressure, the acceptance of high-priced supply is not high, and the actual transaction price of rigid demand procurement is low. On the supply side, the production of separated enterprises and waste recycling enterprises was normal, the supply of raw ore and waste resumed, and Baotou enterprises resumed normal production after the Winter Olympic Games, resulting in an increase in output. Last week, praseodymium and neodymium oxide produced 1465 tons, up 0.9% from the previous week; metal praseodymium and neodymium produced 1347 tons, up 0.07% from the previous week. Praseodymium and neodymium production enterprises resumed production, and the increase in operating rate led to an increase in inventory. Last week, the inventory of praseodymium-neodymium oxide factory was 3437 tons, up 2.57% from the previous week; the inventory of praseodymium-neodymium metal factory was 1620 tons, up 6.58% from The cost of praseodymium-neodymium oxide remained high last week. The average gross profit of the industry increased slightly by 0.75% to 878 million yuan / ton compared with the previous week, while the average gross margin of the praseodymium-neodymium metal industry fell 8.57% to 23300 yuan / ton.

Heavy rare earths: the price of heavy rare earths showed an upward trend last week, market sentiment in the dysprosium market was general at the beginning of the week, downstream inquiry orders increased slightly, merchants offered firm prices, there were still stocks downstream, market sentiment weakened in the middle of the week, and some traders quoted low prices. The national average price of dysprosium oxide is 3130 yuan / kg, down 0.32% from the previous week; the average price of dysprosium ferroalloy is 3130 yuan / kg, which is flat. The spot market of terbium oxide is tight, there are not many shipping quotations, and the transaction price is high. Merchants continue to be optimistic about the future of terbium oxide. The national average price of terbium oxide is 15250 yuan / kg, up 1.67% from the previous week; the average price of metal terbium is 19200 yuan / kg, up 2.13% from the previous week. Last week, the domestic average price of gadolinium ferroalloy was 655 million yuan / ton, up 0.77% from the previous week; the domestic average price of gadolinium ferroalloy was 195.5 million yuan / ton, which was flat.

Other raw materials: LME cobalt futures rose 1.68 per cent to $74000 per tonne. The price of ferroboron (18%) was stable, and the price of gallium (99.99%) rose 2.15% to 2375 yuan / kg per week. The price of domestic ferroniobium alloy (60mura) is 2685 thousand yuan / ton, which remains stable.

Sintered NdFeB: the price of NdFeB went up last week, the price of N series and H series blank remained stable, and the price of M series and high-end blank increased by 10 yuan / kg. Magnetic material enterprise inquiry order replenishment enthusiasm is not high, rare earth raw material prices slow down, under financial pressure, downstream enterprises to lock procurement.

Positive cobalt raw materials continue to hit new highs, cobalt sulfate prices go up, and the prices of lithium sources and cathode materials continue to rise sharply. Lithium hexafluorophosphate in the electrolyte link is high and stable, DMC continues to fall, and the electrolyte price is high and stable. The anode material and diaphragm remain stable. The price of copper foil is stable for the time being, and the processing fee is expected to be increased later.

Cathode materials: last week, battery-grade electrolytic cobalt at the end of ternary cathode raw materials rose 2.53% to 548,000 yuan / ton, cobalt sulfate rose 1.36% to 11.15 million yuan / ton, and nickel and manganese sulfates remained stable. In terms of ternary precursors, the prices of NCM523 and NCM622 rose slightly by 0.71% and 0.35% respectively from the previous week. The prices of lithium sources continued to soar, with battery-grade lithium carbonate and lithium hydroxide rising 5.94% and 11.54% respectively from the previous week to 464000 yuan per ton and 4155,000 yuan per ton respectively. The price of ternary cathode materials still increased significantly, with NCM523 and NCM622 cathode prices rising 4.22% and 9.25% respectively from the previous week; the price of precursor positive Lin acid iron was unchanged at 23500 yuan / ton, and the price of lithium iron phosphate cathode rose 11.89% to 160,000 yuan / ton.

Electrolyte: lithium hexafluorophosphate remained stable at a high of 590,000 yuan / ton last week, and the average ex-factory price of DMC continued to decline, falling 9.33% to 6800 yuan / ton compared with the previous week. The prices of all kinds of electrolytes remain high and flat on a month-to-week basis.

Negative materials: the prices of domestic mid-end man-made and natural graphite are 515,000 yuan / ton and 385,000 yuan / ton respectively, which are the same as the week-to-month ratio.

Diaphragm: last week, the domestic mainstream product price of wet coating diaphragm was maintained at 1.88-3.87 yuan / square meter. The diaphragm enterprises fully resumed operation, and the inventory level of domestic manufacturers remained low.

Battery grade copper foil: last week 8um/ battery grade copper foil mainstream market price 105500-107500 yuan / ton, 6um/ battery grade copper foil mainstream market price 115500-117500 yuan / ton, 4.5um/ battery grade copper foil mainstream market price 137500-150500 yuan / ton. Last week, the epidemic situation in Jiangsu, Zhejiang and other places limited the demand for copper foil in some electronic circuits and the logistics and shipment of copper foil enterprises in other places, but the current orders signed by mainstream enterprises in the market are good. At present, domestic enterprises are still implementing the processing fee prices before the Spring Festival, and due to the fluctuation of raw material prices, the price adjustment plan has been postponed, and most copper foil enterprises have planned to raise the processing fee prices of various models of copper foil in early March.

The price of DRAM downstream of semiconductor materials is stable, while the price of flash memory rises slightly.

Last week, the semiconductor industry index in Taiwan and Philadelphia fell 4.77% and rose 2.02% from the previous week, respectively. The ax index rose 1.31% from the previous week. For DRAM, downstream DDR3 4Gb (1600MHz) prices are flat at $2.848. NAND Flash 64Gb and 32Gb prices rose 0.09 per cent and 0.24 per cent, respectively, from the previous week.

Investment suggestion

It is suggested that we should continue to pay attention to the opportunities of rare earth permanent magnet plates that are expected to be significantly increased by policy-driven demand growth and whose valuation has entered a reasonable historical range, as well as the release of short-term high valuation risk, the pull of the demand for carbon-carbon matrix composites under the long-term growth prospect of photovoltaic installations, the increase in market capacity brought about by the demand for lithium-ion materials in the long-term development space of electric vehicles, and the long-term trend of localization of integrated circuits. Progress and opportunities of localization of semiconductor materials.

Risk hint

Price decline risk, prosperity change risk, policy change risk.