The geopolitical situation disturbs the supply and stabilizes the demand for bottom support in the economy [institutional review]

Main points of investment:

Steel:

The purchase volume of screw is + 55.99%, the output of the five major steels is + 3.36%, and the price of steel is + 2.59%. The supply of steel mills resuming production has rebounded somewhat, and it is expected that there is still room under the peak season; the demand side recovers quickly, but follow-up data need to be paid attention to to verify the stable economic effect, the raw material side is affected by oil prices, the supply disturbance in Russia and Ukraine indirectly affects steel prices, and the profitability of steel mills has improved. At present, the main industry is affected by the stable economy + Russia-Ukraine situation, short-term steel prices or shock upward, we need to continue to pay attention to the stable economic promotion and the development of the situation in Russia and Ukraine. In the long run, we need to pay attention to the field of growing special steel.

Industrial metals:

The current price of LME copper is + 5.50% + 14.77%, the current price of aluminum in LME is + 14.77%. Aluminum: the situation in Russia and Ukraine disturbs supply, high energy costs increase the expectation of production reduction in European aluminum plants, domestic economic demand is stable and supply is gradually recovering, aluminum prices may be high in the short term.

New Energy Metals:

In terms of lithium, the price of lithium carbonate / lithium hydroxide is + 7.41% and 8.07%. Domestic lithium supply and demand is tight and inventory is low, the Ministry of Industry and Information Technology is concerned about lithium prices, but it may be difficult to decline under the support of fundamentals. In the short term, Tellyson released volume in March and SQM in June. Lithium supply is expected to ease but still tight after March. Lithium price growth will narrow but remain high after March.

Rare earth:

Praseodymium-neodymium oxide / dysprosium oxide / terbium oxide price ratio + 0.91% market 0.48% color 0.33%. Environmental protection is becoming stricter, the epidemic situation in Inner Mongolia, Myanmar mines are blocked to restrict supply, demand-side procurement orders are weak, there is a game between the two sides, the impact of MIIT interviews on prices may be limited under the support of fundamentals, and prices may fluctuate in the short term.

Investment suggestion

Iron and steel suggest to pay attention to Yongjin shares (603995) and Yongxing Materials (002756). Industrial metals suggest to pay attention to Jiayuan Technology (688388) and Nanshan Aluminum (600219). New energy metals suggest to pay attention to Ganfeng lithium industry (002460) and Tianqi lithium industry (002466). Rare earths suggest to pay attention to northern rare earths (600111) and Minmetals rare earths (000831).

Risk hint

Raw material price fluctuation risk, lower-than-expected demand risk, novel coronavirus epidemic spread beyond the expected risk.