The Zhitong Finance App learned that Guohai Securities released a research report saying that with the continuous breakthroughs and release of high-quality domestic carbon fiber and the continuous development of downstream military, satellite internet, AI and other fields, satellites, rockets, robots, etc. are expected to become a new increase in demand for carbon fiber. As carbon fiber inventories accumulate and prices decline, the profitability of carbon fiber products and business operations are facing challenges. Large-scale production expansion is expected to slow down, and leading companies are expected to further gather resources by relying on advantages such as scale, cost, technology, and capital. Considering that prices in the carbon fiber industry are gradually bottoming out and that downstream demand still has good room for growth in the long term, application scenarios are still expected to expand further and maintain the industry's “recommended” rating.

Guohai Securities's views are as follows:

Domestic large-wire bundles and low-end small-wire bundles of carbon fibers are under loss pressure, and carbon fiber prices are gradually bottoming out

According to Baichuan Yingfu, as of the end of December 2023, the average domestic market price of large wire bundle carbon fiber without tax was 66,000 yuan/ton, while the small wire bundle T300 (12K), T300 (24/25K), and T700 (12K) were 7.5, 6.8, and 128,000 yuan/ton, respectively. According to the bank's estimates, the operating cost of a single ton of large wire bundle carbon fiber is about 74,000 yuan/ton (cash cost is about 64,000 yuan/ton), and the operating cost of a single ton of small wire bundle carbon fiber is about 90,000 yuan/ton (cash cost is about 80,000 yuan/ton). Under current market prices, large wire bundles and low-end small wire bundle carbon fiber are under loss pressure, and carbon fiber prices are gradually bottoming out. Furthermore, according to Baichuan Yingfu, as of the end of December 2023, the T300 (12K) and T300 (24/25K) raw silk prices without tax were 3.4 and 32,000 yuan/ton, respectively, and there is still relatively considerable profit margin.

New applications such as aerospace and robotics are expected to increase demand for carbon fiber

According to Sciao Carbon Fiber, the global demand for carbon fiber in 2022 is 135,000 tons, including 74,400 tons in China (11.8/62,400 tons in 2021, respectively). The total domestic demand for carbon fiber is expected to reach 132,000 tons in 2025, and the CAGR will reach 20.6% in 2021-2025. Downstream applications of carbon fiber in China in 2022 mainly include wind power blades (23.5%), sports and leisure (30.9%), aerospace and military (10.5%), carbon-carbon composites (9.1%), pressure vessels (8.1%), etc. Among them, demand in aerospace and military industry increased 290% year-on-year in 2022, showing a rapid growth trend. As domestic high-quality carbon fiber continues to break through and release, as well as the continuous development of downstream military, satellite internet, AI and other fields, satellites, rockets, robots, etc. are expected to become a new increase in demand for carbon fiber.

Carbon fiber development has entered a new stage, and leading companies are expected to benefit from a full reshuffle

As carbon fiber inventories accumulate and prices decline, the profitability of carbon fiber products and business operations are facing challenges. Large-scale production expansion is expected to slow down, and leading companies are expected to further gather resources by relying on advantages such as scale, cost, technology, and capital. Guangwei Composites is the layout of the entire carbon fiber industry chain. The first phase of the Inner Mongolia project is about to be put into operation; Zhongfu Condor is the first phase of the Inner Mongolia project, with a production capacity of 28,500 tons and 30,000 tons under construction, with significant cost and scale advantages; Jilin Carbon Valley is a carbon fiber source with orders of 100,000 tons in 2023, and the 2023H1 sales target is nearly 40,000 tons; Jilin Chemical Fiber Group is the domestic large wire bundle carbon fiber leader, with a production capacity of about 50,000 tons.

Focus on the target:

(1) Civilian high-performance carbon fiber leader that has basically achieved the benchmark with Dongli: Zhongfu Condor (688295.SH); (2) Carbon fiber industry leader: Guangwei Composite (300699.SZ); (3) carbon fiber raw wire faucet: Jilin Carbon Valley; (4) viscose filament faucet, relying on the group's strength to rapidly expand carbon fiber production capacity: Jilin Chemical Fiber (000420.SZ); (5) Building the first 10,000-ton 48K large-wire carbon fiber localization device in China: Shanghai Petrochemical (600688.SH); (6) Military carbon fiber faucet: Zhongjian Technology ( 300777.SZ); (7) Integrated development of carbon fiber - pre-impregnation - composite, military and civilian carbon fiber covers: Hengshen Co., Ltd.; (8) Carbon fiber carbonization equipment leader: Seiko Technology (002006.SZ).

In addition, carbon fiber composite manufacturers are expected to benefit from falling carbon fiber prices. It is recommended to focus on Jinbo Co., Ltd. (688598.SH), Tianyi Shangjia (688033.SH), etc.

Risk warning: Carbon fiber prices fluctuate greatly, carbon fiber production capacity expansion falls short of expectations, carbon fiber application promotion falls short of expectations, downstream demand growth such as wind power, aerospace, carbon and carbon thermal fields falls short of expectations, raw material prices fluctuate greatly, the international situation is volatile, industry policies have changed drastically, focusing on the company's project progress and performance falling short of expectations, and the uncertainty of the carbon fiber domestic replacement process.