FinanceTong app learned that Open Source Securities released a research report stating that China's electrical utilities capacity will maintain steady growth, while the United States can be compared to 2000-2003 during the period of transition from old to new contradictions, with infrastructure construction being given priority. Coupled with the aging of the American power grid and the pull of AI and data centers on power demand, the upgrade of the American power grid will gradually unfold, and the investment cycles of the Chinese and American power grids may resonate with each other, which may have a significant impact on the demand for copper and aluminum. Recommended symbols: Zijin Mining Group (601899.SH), CMOC Group Limited (603993.SH), Chinahongqiao (01378), Yunnan Aluminium (000807.SZ); benefiting symbols: JCHX Mining Management (603979.SH), Tianshan Aluminum Group (002532.SZ), and Shandong Nanshan Aluminium (600219.SH).

The major viewpoints of Open source Securities are as follows:

The upgrade of the American power grid may gradually unfold.

The aging of power equipment, the growth of power demand and the structural transformation of energy have had an impact on the US power system. The US power grid is facing security and stability issues and urgently needs to be upgraded. The carrying capacity of the U.S. power grid is insufficient, and the capacity of interconnection requests is soaring. A large amount of newly added renewable energy has had an impact on the stability of the traditional power grid; the return of U.S. manufacturing industry, the increase in the market share of electric vehicles, the development of data centers, cryptos, and AI have greatly increased the demand for power, coupled with the aging problem of the U.S. power grid, which urgently needs to be upgraded. At the macro level, U.S. policies are increasingly supporting investment in power, and at the meso level, the power investment budgets of U.S. utilities are constantly increasing, mutually confirming each other. The upgrade of the American power grid may be gradually unfolding.

China's copper, aluminum, and steel account for a relatively large proportion of global demand and are key areas of concern.

Copper: In terms of total demand, China has the largest copper consumption, and in terms of incremental demand, China has the most significant impact. The global copper consumption in 2022 is 25.84 million tons, with an increment of 1.07 million tons, and China's power grid consumption is 5.3 million tons, accounting for 20.5% of the total, with an increment of 0.84 million tons, accounting for 79% of the total incremental. The copper consumption is mainly on the transmission and distribution side, followed by the power generation side. In the transmission and distribution side, copper is mainly used for lines, followed by transformers.

Aluminum: The global aluminum consumption in 2022 is 68.05 million tons, with an increment of -0.42 million tons. China's power grid consumption is 9.18 million tons, accounting for 13.5%. The consumption of aluminum in the U.S. power grid is 2.31 million tons, accounting for 3.4%, with an increment of -0.5 million tons, dragging down the total incremental of global aluminum consumption. In terms of subdivisions, the consumption of aluminum is mainly on the transmission and distribution side, followed by the power generation side. On the transmission and distribution side, aluminum is mainly used for substations, followed by lines.

Steel: Open Source Securities predicts that China's power grid steel consumption in 2023 will be 81.28 million tons (an increment of 37.4 million tons), and crude steel production will be 1.019 billion tons, accounting for 8.0%. The steel consumption of the U.S. power grid is 9.85 million tons (an increment of 0.45 million tons), and crude steel production is 80.66 million tons, accounting for 12.2%. In terms of subdivisions, the consumption of steel is mainly on the power generation side, followed by the transmission and distribution side.

Copper: After calculation, Open Source Securities predicts that China's power grid copper consumption in 2030 will be 4.68 million tons, with an average annual compound growth rate of -5% from 2023 to 2030. The annual consumption of copper in the US power grid is 5.35 million tons, with an average annual compound growth rate of 18% from 2023 to 2030. The global copper consumption in 2030 will be around 35.84 million tons.

Aluminum: After calculation, Open Source Securities predicts that China's power grid aluminum consumption in 2030 will be 8.14 million tons, with an average annual compound growth rate of -3% from 2023 to 2030. The annual consumption of aluminum in the US power grid is 9.03 million tons, with an average annual compound growth rate of 19% from 2023 to 2030. The global aluminum consumption in 2030 will be around 95.41 million tons.

Risk warning: Deviation of prediction data caused by parameter deviation.