share_log

国海证券:环保政策影响铝加工开工率 氧化铝维持强势

Sealand: Eco-friendly policies affecting aluminum processing rates, alumina remains strong.

Zhitong Finance ·  Nov 4 09:35

Domestically, the State Council stated that it will continue to implement a package of incremental policies promptly, assess and optimize policies in a timely manner.

According to the Securities Times app, Sealand released research reports stating that, in the short term, there is a risk of weakening demand for electrolytic aluminum, and the operating rate of aluminum processing links further decreased. Although there are environmental protection restrictions affecting, the expectation of future weakening still exists, and attention still needs to be paid to the actual realization of demand, policy expectations, and macro changes. Comparatively, the fundamentals of alumina are more robust. In the short term, the supply of bauxite remains tight, with shipments of bauxite from Guinea not fully recovered yet, and the supply of bauxite remains tight, driving the continuous rise of alumina prices both domestically and internationally. Companies with integrated operations will clearly benefit. In the long term, the aluminum industry has limited long-term incremental supply, while demand still has growth points, and the industry may maintain high prosperity.

The main views of Zhonghai Securities are as follows:

Macro: The macro situation in the week of October 28 to November 1 still tends to be bullish.

The European Central Bank and the Federal Reserve successively showed signs of pausing rate cuts, the U.S. ADP employment data greatly exceeded expectations, enhancing expectations of a soft landing, the USD is strengthening, and in addition, the market is trading with expectations on Trump's re-election, with the market broadly waiting for the results of the U.S. election on November 5.

Domestically, the State Council stated that it will continue to implement a package of incremental policies promptly, assess and optimize policies in a timely manner. The National Development and Reform Commission stated that it is necessary to introduce a powerful and unconventional policy combination. China's official manufacturing PMI in October recorded 50.1, higher than the boom-bust line. In the domestic market, with monetary easing and interest rate cuts, liquidity is being released, and attention is being paid to the policy direction of the 14th National People's Congress Standing Committee meeting scheduled for November 4.

Electrolytic Aluminum: Domestic electrolytic aluminum companies mainly maintain stable operation, with a slight decline in downstream aluminum production.

Supply: Domestic aluminum smelters maintained stable operation as the main focus this week. In terms of costs, the aluminum oxide futures market maintained a slightly strong and fluctuating trend, with a tight spot market situation, and the rapid growth status of aluminum smelting costs. As of October 31st, the immediate complete average cost of domestic aluminum smelting is about 19,698 yuan/ton, an increase of 474 yuan/ton from last Thursday. The industry's profit margin is narrowing, with the national average aluminum smelting profit at about 1,082 yuan/ton, down 774 yuan/ton from last Thursday. Overseas, this week, the second phase of a 0.25 million ton aluminum smelter in Indonesia officially started production, expected to reach full capacity by the end of the year or early next year. Aluminum smelting in other regions maintained stable operation mainly, with the window for importing primary aluminum in China remaining closed, and overseas aluminum ingot circulation being relatively limited.

Demand: Downstream aluminum production in China slightly decreased this week, mainly due to several regions in Henan, Hebei, Shandong, and other provinces implementing strict pollution control measures due to heavy pollution weather, which has led to restrictions on production and transportation for some aluminum processing enterprises in the regions, resulting in a decline in industry operating rates. The domestic spot aluminum market maintained an insufficient supply situation this week, with mainstream regions like Wuxi and Foshan maintaining destocking status, and the spot price basis remaining relatively stable.

Aluminum Processing: At the end of the peak season, domestic aluminum rod inventories showed slight fluctuations.

According to SMM, as of October 31st, the total social inventory of aluminum rods in China was 0.1142 million tons, increasing by 0.0044 million tons from last Thursday, and by 0.0033 million tons since Monday. Subsequent inventory changes still need to focus on downstream consumption conditions of high aluminum prices and whether the transportation from mainstream supply sources is smooth. The domestic aluminum profile operating rate decreased again this week, dropping by 1.50 percentage points from the previous week to 50.40%. Recent heavy pollution weather in Shandong, Hebei, Tianjin, and other areas has affected some aluminum profile factories, requiring a 10-30% production cut, resulting in a significant decline in operating rate for the week. In addition, due to the continuously low processing fees for photovoltaic profiles, leading enterprises have also started to be more selective in accepting orders to avoid further losses. Overall, as the terminal demand gradually transitions to the off-season at the end of October, although there has not been a significant slump, demand risks still need to be monitored.

Bauxite: Aluminum oxide prices continue to rise strongly, expanding profit margins.

According to SMM, as of October 25th, the total weekly import volume of bauxite in domestic ports was 3.7304 million tons, a decrease of 0.1693 million tons from the previous week; the weekly export volume of bauxite from the main ports in Guinea decreased by 0.398 million tons to 1.8103 million tons compared to the previous week's 2.2083 million tons, while the weekly export volume of bauxite from major ports in Australia increased by 0.0161 million tons to 0.9333 million tons. With the continuous tight supply situation of bauxite, prices have been steadily rising. By October 31st, the CIF price of Guinean bauxite rose to $82.5 per ton, an increase of $5.5 per ton from last Thursday.

Overseas, as of October 31st, the FOB price of alumina in Western Australia remained at 693 yuan/ton, equivalent to around 5877 yuan/ton at major domestic ports for external sales, higher than the domestic alumina price of 821 yuan/ton, with the spot import window of alumina remaining closed. With the ongoing shortage of overseas alumina supply, transaction prices have been steadily rising. On October 25th, overseas transactions of alumina reached 0.03 million tons, with a transaction price of $730 per ton.

In China, according to SMM, as of October 31st, the nationwide weekly operating rate of alumina decreased by 1.99 percentage points from the previous week to 81.82%. This is mainly due to the arrival of the heating season and the issuance of heavy pollution weather forecasts in many areas, affecting the calcination of some alumina plants in the short term; additionally, some individual companies have experienced calcination reduction due to equipment failures, leading to a decrease in operational capacity. Spot transaction prices have further increased, with a price range of 5120-5240 yuan/ton.

Overall, on the demand side, the demand for alumina from domestic aluminum smelters remains stable and positive, with backup demand from aluminum smelters still existing; there is a shortage in overseas alumina supply, with prices rising sharply, leading some companies to turn to domestic sources for alumina supplements, opening up the export window, and expecting some alumina to be exported.

On the supply side, restrictions on bauxite for increasing alumina production capacity still exist, with frequent warnings of heavy pollution weather; recently, alumina plants in Shandong, Hebei, Henan, and other regions have been affected by calcination, while the southwest region also has alumina plant maintenance incidents, resulting in a temporary reduction in alumina supply. It is necessary to continue monitoring the impact of the winter heating season policy on alumina production in northern regions.

Prebaked anode: Prebaked anode prices are falling, while petroleum coke prices are rising.

As of November 1st, the average price of prebaked anodes was 4330.0 yuan/ton, a decrease of 17.5 yuan/ton compared to the previous week, a week-on-week decrease of 0.4%; the average price of medium sulfur petroleum coke was 2224.7 yuan/ton, an increase of 17.2 yuan/ton compared to the previous week, a week-on-week increase of 0.8%.

Investment advice and industry ratings:

Maintain a “recommended” rating for the aluminum industry.

Recommend focusing on Chinahongqiao (01378), Tianshan Aluminum Group (002532.SZ), Henan Shenhuo Coal & Power (000933.SZ), Aluminum Corporation of China (601600.SH), and Yunnan Aluminium (000807.SZ).

Risk warning: (1) Downstream demand falls short of expectations risk; (2) Policy control measures exceed expectations risk; (3) Risk of insufficient electrical utilities supply; (4) Supply increase exceeding expectations risk; (5) Risk of untimely data updates; (6) Focus on company performance not meeting expectations risk.

The translation is provided by third-party software.


The above content is for informational or educational purposes only and does not constitute any investment advice related to Futu. Although we strive to ensure the truthfulness, accuracy, and originality of all such content, we cannot guarantee it.
    Write a comment