The Zhitong Finance App learned that CICC released a research report saying that the daily melting volume of photovoltaic glass has accelerated since March, driving an increase in demand for sodium pyroantimonate. Against the backdrop of rigid and disrupted supply, antimony prices have risen at a high level. According to data from Asia Metal Network and Baichuan Yingfu, as of April 24, the average prices of antimony concentrate, domestic antimony ingots, and MB antimony were reported at 84,500 yuan/ton, 98,000 yuan/ton, and 14,600 US dollars/ton respectively, up 24% from the beginning of this year. Domestic antimony ingot prices were only 10% lower than the 2011 high. On the other hand, considering the rigidity of global antimony ore supply, global antimony supply and demand are expected to maintain a tight pattern.

It is recommended to focus on targets with abundant reserves and strong yield growth: Huaxi Nonferrous (600301.SH), Huayu Mining (601020.SH), and Hunan Gold (002155.SZ).

The main views of CICC are as follows:

On the demand side, the PV industry continues to be booming, and domestic trade-in policies are expected to boost demand in traditional sectors

According to CICC estimates, photovoltaic glass will account for 22% of the downstream consumption structure of antimony in 2023, and flame retardants will account for 52%. First, according to Zhuochuang information, the daily melting volume of photovoltaic glass reached 106,000 tons on April 19, and the daily melting volume of photovoltaic glass has accelerated since March, driving demand for sodium pyroantimonate significantly. Considering that PV module production schedules were high in April and May and increased month-on-month, demand for sodium pyroantimonate is expected to continue to grow. Second, the flame retardant, which accounts for the largest share of downstream demand for antimony, is highly related to fields such as electrical equipment. On April 12, 14 departments including the Ministry of Commerce issued a notice on the “Action Plan to Promote Trade-In of Consumer Goods”, making detailed arrangements for the trade-in of household appliances. The gradual implementation and implementation of the trade-in policy is expected to drive an improvement in the amount of antimony used as flame retardants.

On the supply side, there were disturbances in the background of rigid supply at the mine side, and domestic smelter inventories continued to be low

First, according to the company's announcement, Hunan Gold Xinlong Mining Headquarters temporarily stopped production on March 27. Its antimony production in 2023 was 6060 tons, accounting for 5% of global antimony ore production in the same year, and production had not resumed as of April 25. We believe that mining side disturbances in the context of rigid supply will further exacerbate the tight supply situation of antimony ore. Second, according to Asia Metal Network, domestic smelter stocks of antimony ingots in March were 1,300 tons, -28%/+8% month-on-month, which is at a historically low level. CICC believes that as downstream demand continues to improve, supply is rigid, and antimony ingot stocks are at historically low levels, antimony prices are expected to continue to rise at a high level.

In the long run, the pattern of tight global antimony supply and demand continues, and the antimony price center is expected to move upward

CICC pointed out that benefiting from the rapid increase in new photovoltaic installations and the increase in the penetration rate of double glass modules, the amount of antimony used in photovoltaic glass is expected to grow rapidly, and the gradual implementation and implementation of the trade-in policy is expected to drive an increase in demand for electrical equipment, etc., thereby driving an increase in the amount of antimony used in the flame retardant sector. It is estimated that the global antimony demand CAGR for 2022 will be about 5.4%. Considering the rigidity of global antimony ore supply, global antimony supply and demand are expected to maintain a tight pattern. It is estimated that in 2024-2027, the global antimony supply and demand gaps will be -0.3, -0.6, -0.4, and -80,000 tons, respectively, accounting for -2%, -4%, and -4% of demand. Supply and demand may continue to be tight, and the antimony price center is expected to move upward.

risks

Overseas supply exceeded expectations, demand for flame retardants fell short of expectations, and downstream demand for antimony was replaced and exceeded expectations.