Nonferrous rides on the new energy ride




With the release of medium and long-term development plans, the new energy vehicle industry has recently become a hot topic in the capital market. The new energy vehicle index has risen by more than 21% since the fourth quarter, and related metal assets have also taken a ride.

Analysts said that the mid-to-long-term plan for the development of the new energy automobile industry has brought room for reveries in related metal investments. Recently, asset prices such as lithium, nickel, cobalt, and platinum have been rising. Investors can pay attention to related opportunities.

New energy vehicle concept popular

On November 5, the new energy vehicle concept continued to play the leading role of A shares. The data shows that as of the close of November 5, the new energy vehicle index rose by 4.83%, ranking 10th among 184 conceptual sector indexes. In terms of constituent stocks, Xiaokang, Yinlun, Tianci Materials, BYD, Aotejia, and Dongfeng Motor have their daily limit, Xinzhoubang rose 16.38%, and Dangsheng Technology and SAIC Motor rose more than 8%. From a long-term perspective, the new energy vehicle index has increased 41.35% since the second half of the year.

The "New Energy Automobile Industry Development Plan (2021-2035)" issued by the General Office of the State Council mentioned that "promote the development of the entire value chain of power batteries and encourage enterprises to improve their ability to guarantee key resources such as lithium, nickel, cobalt, and platinum." People pay wide attention.

In terms of the performance of related metal concepts, data shows that the nickel ore index has risen by 9.26% this week. From the perspective of related stocks, Western Mining has increased by 19.16% this week, and Shengtun Mining has increased by 13.50%.

In the spot market, the prices of lithium and cobalt, the main members of the "new energy metal" family, started to rise in the first half of this year after experiencing a sharp drop in the previous period. According to data from Zhuo Chuang Information, as of November 5, the average price of industrial-grade lithium carbonate in East China was 37,000 yuan/ton, a cumulative increase of 8.80% from the low price in early June; the electrolytic cobalt market price closed at 269,000 yuan/ton The cumulative increase in price lows at the end of April reached 15.7%.

Increased demand for non-ferrous metals

The increase brought by new energy vehicles to the automotive industry is the starting point of this round of new energy vehicle investment. The development plan proposes that by 2025, the sales of new energy vehicles will reach about 20% of the total sales of new vehicles. By 2035, pure electric vehicles will become the mainstream of newly sold vehicles, and vehicles in public areas will be fully electrified.

For the new energy automobile industry, how much space is there for incremental growth? Liu Chao, chief researcher of BOCI Futures Nonferrous Metals, told the China Securities Journal that according to the development plan, by 2025, my country's new energy vehicle sales will account for 20%. According to data from the Ministry of Industry and Information Technology, my country's new energy vehicle production and sales volume exceeded 1.2 million in 2019. It is estimated that by 2025, sales of new energy vehicles in my country will reach 5.15 million.

During the new crown pneumonia epidemic, electric vehicles, especially Tesla, are selling well against the market, making the prospects of this industry more and more important to the market.

Wang Yanhong, an analyst at Meierya Futures Research Institute, told a reporter from China Securities News that from a volume perspective, the current sales of new energy vehicles account for less than 5%. In urban transportation, both taxis and buses have large replacement capacity. New energy vehicles will continue to provide demand for non-ferrous metals such as copper, aluminum, lithium, and nickel. From a qualitative point of view, the future is the peak period for the development and output of pure electric vehicle batteries, and a golden period for the rapid development of clean energy. The demand for battery replacement will further increase the demand for non-ferrous metals, such as lithium battery copper foil. In the future, non-ferrous metals, especially copper, aluminum, lithium, nickel, and cobalt, have greater potential on the demand side.

Liu Chao said that the main non-ferrous metals used in new energy vehicles include nickel, lithium, cobalt, etc. The replacement of traditional automobile consumption by new energy vehicles will significantly increase the consumption of related non-ferrous metals. The trend of the new energy automobile industry is gradually shifting from Chinese subsidies to global subsidies. European and American automakers have concentrated on launching new models, stimulating global demand.

Han Minhua, cobalt and lithium analyst at Zhuo Chuang Information, told the China Securities Journal: "From a fundamental point of view, the development guidelines for new energy vehicles will continue to drive the growth of lithium demand and consumption. It is expected that the demand for cobalt and lithium will be considerable in the next few years."

Wang Yanhong analyzed that the era of Industry 4.0 is coming, which opens up new application scenarios for some non-ferrous metals. In the demand for non-ferrous metals, non-ferrous metals, which accounted for a relatively large demand for traditional projects in the past, may continue to face supply-side structural reforms, but for non-ferrous metals that have high demand in the electronic field and new infrastructure, such as copper, aluminum, lithium, nickel, Cobalt is expected to complete its own capacity replacement during the transformation of new and old industries and enter a new demand application scenario.

Multi-channel investment in new energy metals

However, new energy vehicles have different demands for different types of downstream non-ferrous metals. Liu Chao analyzed that according to Glencore Group's forecast, as the world shifts to a green economy and the demand for electric vehicles increases, there will be an additional demand for lithium LCE of 673,100 tons, 1.1 million tons for nickel, and 87,000 tons for cobalt in the future. According to the proportion of non-ferrous metal demand increase and current output, the order is cobalt>lithium>nickel, which means that the future cobalt demand increase will be the largest, and the probability of supply shortage will be the largest, followed by lithium and nickel. Due to the difference between supply and demand, prices are prone to differentiation.

From the perspective of investment channels, Liu Chao suggested that investors can first participate in new energy-related listed companies to invest in the stock market; secondly, they can also participate in the domestic futures market, such as all standard copper and nickel futures products of the Shanghai Futures Exchange. In terms of investment strategy, Liu Chao said: “It is recommended to pay attention to the changes in demand forecast data and the valuation dividends brought about by technological progress. The current prices have already reflected expectations, pay attention to dynamic changes, and evidence of actual market demand increments. Quasi-ventures to obtain excess returns."

Wang Yanhong said that there are three channels for domestic investment in new energy metals. First, select the corresponding stocks of listed companies engaged in the production of new energy metal materials in the stock market, and it is recommended to make investment arrangements after being familiar with the new energy industry chain. Second, directly invest in copper, aluminum, nickel and Other futures products in the futures market, and you need to pay attention to the risk of price fluctuations when investing. Third, invest in fund products related to new energy materials, but pay attention to the holdings of fund products, and choose to purchase fund products in the whole industry chain or focus on fund products in a certain sector according to personal risk preferences.


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