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[copper foil weekly] the proportion of 6 micron copper foil production is gradually expanding! Copper is expected to become the main trading variety in 2020



[company] Tongling Nonferrous Metals' intention to split and list is obvious, and it is a fragile sprint on the 0.8% profit line

On December 13, the "Several Provisions on the pilot domestic listing of subsidiaries of listed companies" published by the China Securities Regulatory Commission is bound to set off a trend of A-share companies' listing of subsidiaries. The reporter found that Tongling Nonferrous Metals Group Co., Ltd. (hereinafter referred to as Tongling Nonferrous Metals, 000630.sz), which was listed in 1996, has started its layout in advance, and there are signs that it will be the first batch of companies to eat crabs.

In November, Tongling Nonferrous Metals announced that its wholly-owned subsidiary Anhui Tongguan copper foil Co., Ltd. (hereinafter referred to as Tongguan copper foil) plans to increase capital and shares to introduce a strategic investor from the outside world. According to the disclosed information, Tongguan copper foil will increase the registered capital by 21.7616.58 million yuan this time, and the registered capital will increase from the current 600 million yuan to 62.17616.58 million yuan. After the capital increase, Tongling Nonferrous Metals' shareholding ratio was 96.5%, and the shareholding ratio of new investors was 3.5%.

Tongguan copper foil is in the downstream of Tongling Nonferrous Metals and its associated companies. Its main business is the manufacturing, sales and services of electronic copper foil, the manufacturing, sales and services of copper materials, copper alloys, electromagnetic wires, wires, copper commodity trade, etc. According to the announcement, its operating revenue in 2016, 2017, 2018 and January July 2019 was 792 million yuan, 1.253 billion yuan, 1.405 billion yuan and 1.482 billion yuan respectively, and its net profit was 72 million yuan, 195 million yuan, 165 million yuan and 83 million yuan respectively. The overall operating condition was good.

Why should such a wholly-owned subsidiary that "makes money" let foreign capital "take a share"? According to the analysis of insiders, Tongling Nonferrous Metals should be preparing for the split and listing of its subsidiaries. (source: Chinanet Finance)

[analysis] copper is expected to become the main trading variety in 2020

Copper is often called "Dr. copper". Due to the correlation between copper and the economic cycle, copper may become a trading variety in 2020, because most industry analysts predict that copper prices will "rise" as global demand recovers.

Christopher lafemina, an analyst at Jefferies, said that due to increased demand, this situation may change next year, making copper "have upward momentum". He wrote in a report to customers that low copper inventories, high short positions, supply side constraints and improved demand have created conditions for copper prices to rise.

Jeffrey Currie of Goldman Sachs optimistically agreed with lafemina that copper "will change" in 2020 due to the strong growth of China's economy. Morgan Stanley, Bank of America and Citi also have positive expectations for copper prices and the improvement of the global economy.

History shows that mining suppliers of base metals usually start adding gold stocks after precious metals outperform the market. The s&p/tsx weighted global base metal index (txbe) did not perform as well as the s&p/tsx weighted global gold index (txge) in 2016, but it caught up with and overtook it by the end of 2017. If analysts' expectations for copper in 2020 are correct, the same trend may come soon. (source: Shanghai metal net)

[industry] scrap copper tightening continues to dominate the supply level

The supply environment of copper mine is flat, which has a weak impact on copper price. Since November, disturbance events in overseas mines have decreased significantly, and the copper mine environment has been significantly calmer than that in October. Antofagasta cut its production by an estimated 10000 tons on November 4. At present, it is estimated that the annual copper production will be 750000-770000 tons, compared with the previous prediction of 750000-790000 tons. On November 26, Glencore announced that the mutada mine in the Democratic Republic of the Congo had been suspended because it was difficult to obtain sulfuric acid. The shutdown began on November 25. After more than a month, the mine would enter the maintenance stage. Glencore had previously announced in August that it would suspend the operation of the mine for two years from the end of the year. The impact of copper supply on copper prices was further weakened in November.

The narrowing of scrap copper import approvals is expected to continue until the end of the year. On November 5, 2019, the 14th batch of import approvals of restricted solid wastes in 2019 was announced. The total amount of approvals involving copper scrap was 11110 physical tons, and the number of approvals was only 19.4% of the number of the 13th batch of approvals, a significant decrease of nearly 80% month on month; According to the average grade of 80%, the amount of metal is about 8888 tons. It is reported that among the 9th to 14th batches of copper scrap approvals that have been published so far, the first four batches are all in the third quarter, and the number of approvals from the 13th batch is in the fourth quarter. At present, the two batches of approval documents for the import of scrap copper in the fourth quarter have been announced, which has been significantly reduced compared with the same period in the previous three quarters. In the fourth quarter, the supply of scrap copper tightened sharply as expected and will continue until the end of the year.

The processing fee in the fourth quarter was acceptable, and the production of refined copper fluctuated little. According to SMM, on the morning of November 21, Jiangxi copper, Tongling, China copper and Freeport determined the long-term single TC price of $62 / ton in 2020, a new low since 2012, and far lower than the processing fee level of $80.8 / ton last year, which is basically in line with market expectations. It is believed that the new smelting capacity in China will be put into operation, but the mine output may remain stable, which puts pressure on tc/rcs.

However, the cspt team held a floorprice price meeting for the fourth quarter in Shanghai on October 17, and determined that the TC floor price for the fourth quarter was $66 / ton. Relevant data show that by the end of the year, Xinjiang Wuxin and Zijin Copper will have a total capacity expansion of 180000 tons, and Zijin Mining (Fujian) will have a refining capacity expansion of 100000 tons. At present, the processing fee of US $66 / ton can be borne by the smelter, and the new smelting capacity and output at the beginning of next year are also rising. The production of refined copper is not expected to fluctuate too much. (source: futures daily)

[International] Nevada copper's mines in the western United States have been put into operation

Nevada copper Corp said on Monday that the pumpkin hollow mine in the western United States has begun production, one of the country's first new mining projects in a decade.

Nevada on December 16, Nevada copper Corp said on Monday that the pumpkin hollow mine in the western United States has begun production, which is one of the first new mining projects in the country in the past decade.

At this time, copper prices are expected to rise due to the growth of demand in the electric vehicle industry. Due to the expectation that the global mining industry is lagging behind, American copper miners have allocated nearly $3billion to invest in small and large mines.

Nevada copper has spent $200million on developing underground mines. The annual output of copper concentrate of the mine is expected to be 27000 tons. (source: Changjiang nonferrous metals network)

[battery think tank]The proportion of 6 micron copper foil production is gradually expanding

Several lithium-ion copper foil head enterprises have revealed that at present, copper foil in the field of power batteries mainly promotes 6-8 micron products, and the proportion of 6 micron copper foil production is gradually expanding, and some enterprises have begun to launch products ≤ 4.5 micron. At the same time, as China officially entered the first year of 5g business, the long-term demand of the copper foil copper clad laminate PCB industrial chain is optimistic, and the ability of the leading copper foil enterprises to flexibly switch production capacity according to market demand is also increasing.

Article source:Battery net

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