The Zhitong Finance App learned that Zhongtai Securities released a research report saying that non-ferrous commodities will enter another round of “resonance upward” and continue to focus on recommending the three major varieties of aluminum/copper and gold. The resilience of the US economy stems from non-manufacturing industries such as services. With continued interest rate hikes and savings consumption, its resilience will eventually be broken. The job market has given a clear signal: 23Q4-24Q1 may be an important inflection point, and long-term real interest rates in the US will also begin a downward trend. More broadly, concerns about US dollar credit and the subsequent rise in central bank gold purchases will push gold prices to new heights.
The views of Zhongtai Securities are as follows:
Continuing the investment ideas proposed in the 2023 Overall Strategy Report, supply-side changes are particularly important in the macroeconomic environment of weak recovery; the corresponding market performance — although also affected by fluctuations in macroeconomic expectations, the excess returns of strong supply-constrained varieties in 2023 are very obvious. At this point in time, the bank is confident that non-ferrous commodities will enter another round of “resonance upward” and continue to focus on recommending the three major varieties of aluminum/copper and gold:
Gold: The resilience of the US economy stems from non-manufacturing industries such as services. With continued interest rate hikes and savings consumption, its resilience will eventually be broken. The job market has given a clear signal: 23Q4-24Q1 may be an important inflection point, and long-term real interest rates in the US will also begin a downward trend. More broadly, concerns about US dollar credit and the subsequent rise in central bank gold purchases will push gold prices to new heights.
Electrolytic copper: The importance of changes in the demand structure has been ignored, the share of real estate consumption in large categories continues to be compressed, and the impact of new energy sources has changed from marginal to global. Short-term copper supply bottlenecks depend on smelting, but the medium- to long-term copper concentrate shortage trend is difficult to change. Especially after 2025, copper supply bottlenecks are particularly prominent, and copper has a strong foundation.
Electrolytic aluminum: Demand for aluminum is similar to copper, but supply-side bottlenecks will be more “fully realized” in 2024-2025 — shortages of raw materials (electricity/petroleum coke, etc.) will continue to reduce the effective compliance production capacity of electrolytic aluminum in China, and electrolytic aluminum will enter the “resource-like” era; in particular, the high capital expenditure and long construction cycle of overseas production capacity are expected to push the price of electrolytic aluminum out of the copper market after 2005 — 25,000/ton will become the new price center level.
Risk warning: risks caused by macroeconomic fluctuations at home and abroad; risks caused by changes in domestic macro-liquidity regulation policies; risks such as falling prices due to raw material capacity releases exceeding expectations; risks such as falling prices due to raw material capacity releases exceeding expectations; risks of falling metal prices; risks of falling metal prices; public data used in research reports may be at risk of information delays or untimely updates; industry size estimates are based on certain assumptions, and there are risks that fall short of expectations, etc.