Zijin Mining(SH:601899) Orient Securities·2025-10-26 08:27Investment Rating - The report maintains a "Positive" outlook on the copper sector, emphasizing mid-term investment value due to favorable conditions in both mining and smelting [8]. Core Viewpoints - The report highlights that the tight supply situation in copper mining is expected to persist, supporting mid-term price increases. Additionally, there is potential for improvement in smelting fees, which presents further investment opportunities [14][15]. - The copper supply from major mines has been revised downwards, with a cumulative reduction of approximately 475,000 tons, indicating a potential decline in supply for 2025 compared to 2024 [15]. - The report also notes that the demand for copper is likely to increase due to the global shift towards low-carbon energy and the expansion of AI data centers, which will further support copper prices [15]. Summary by Sections Copper Sector - Supply Side: The report indicates that the supply of copper concentrate is tight, with major mining companies lowering their production forecasts for 2025. This is expected to keep supply levels flat or slightly declining compared to 2024, which had a 4.5% growth rate [15]. - Smelting Sector: The report suggests that the growth rate of copper smelting capacity may not keep pace with the supply growth of copper mines, leading to an expected increase in smelting fees. This presents potential for performance improvement in smelting companies [14][15]. Steel Sector - Profitability: The report notes that steel profitability is under pressure due to rising costs, with the average cost of long-process rebar increasing slightly by 0.32% week-on-week [32]. - Price Trends: The overall steel price index has shown a slight increase of 0.15%, with specific products like hot-rolled steel experiencing a 0.40% rise, while medium-thick plates saw a minor decline [38][39]. - Inventory Levels: Both social and steel mill inventories have decreased, indicating a tightening market which could support price stability [27][28]. New Energy Metals - Lithium Supply: The report highlights a significant year-on-year increase in lithium carbonate production, with September 2025 production reaching 69,940 tons, up 64.18% from the previous year [43]. - Demand for New Energy Vehicles: The production and sales of new energy vehicles in China have shown substantial growth, with September 2025 figures indicating a 22.14% increase in production and a 22.77% increase in sales compared to the previous year [47]. Industrial Metals - Market Sentiment: The report notes that recent US-China talks have improved market sentiment, leading to an overall increase in metal prices [63]. - Copper Production: Global refined copper production has increased, but the growth rate is not keeping up with demand, indicating a potential supply-demand imbalance [63].