In the past few days, the continuous fermenting “Lun Nickel Incident” has stirred up the market.
On the evening of March 9th,Huayou Cobaltissued a clarificationannouncementIt is said that the nickel futures market has experienced ultra-abnormal fluctuations recently, and the company has not been forced to liquidate its positions so far, and the risk is controllable.
Huayou CobaltIt has been a partner for many years with Tsingshan Group.According to the data, Tsingshan Group had previouslyHuayou CobaltJointly established the joint venture Huake Nickel Indonesia Co., Ltd., of which Tsingshan Group holds 30% of the shares. Huake Nickel has built a high-nickel matte project with an annual output of 45,000 tons of nickel-containing metal; at the end of 2018, Huayou Cobalt, Qingchuang International, Woyuan Holdings and LONGSINCERE jointly established Huayue Nickel-Cobalt (Indonesia) Co., Ltd. in Indonesia. The joint venture will build a nickel-cobalt hydroxide project with an annual output of 60,000 tons of nickel metal; in March 2021, Tsingshan Group announced that it will cooperate with Huayou. cobalt industry,Zhongwei Co., Ltd.Signed a high nickel matte supply agreement.
It is reported that Tsingshan Group is a private enterprise specializing in stainless steel production. It has formed a whole industrial chain layout from nickel mining, ferronickel smelting to stainless steel smelting, stainless steel continuous casting billet production and stainless steel plate, bar and wire processing. Raw materials, intermediate products and new energy in the energy fieldBattery, mainly used in energy storage systems and electric vehicles and other fields.according toCITIC Construction InvestmentStatistics show that in 2020, Tsingshan Group owns 18% of the global nickel market share.
The announcement shows that nickel is the main raw material in the production and operation of Huayou Cobalt Industry. The company has deployed nickel-cobalt resource development business in Indonesia. Under the circumstance that nickel prices continue to rise, in order to prevent and control the risk of falling prices and lock in operating profits, the company combines its own Production and operation, the nickel hedging business is carried out in strict accordance with the company’s hedging management system.
At the same time, Huayou Cobalt also stated that hedging business is a common risk prevention tool in production and operation, not active speculation. Recently, the nickel futures market has experienced ultra-abnormal fluctuations. Up to now, the company has not been forced to liquidate its positions, and the risks are controllable. The future trend of nickel futures is uncertain, and there is a risk that the company’s hedging business may suffer losses.
Regarding the recent market concerns about the company’s operation and production status, Huayou Cobalt said: “The production and operation conditions are normal, and the laterite nickel ore hydro-smelting crude nickel-cobalt hydroxide project and laterite nickel ore pyro-smelting high nickel matte project in Indonesia are deployed. Other nickel-cobalt resource development projects are progressing normally, of which the subsidiary Huayue Nickel-Cobalt Co., Ltd. has an annual output of 60,000 tons of nickel metal and the laterite nickel ore hydro-smelting project has been successfully put into trial production.”
It is reported that the Huayue Nickel Cobalt (Indonesia) Wet Process Project is located in Qingshan Industrial Park, Morowari County, Sulawesi Island, Indonesia. The project started construction in March 2020.China ChemicalThe overseas general contracting and construction of the project is divided into two stages. The first stage is the construction of a laterite nickel ore hydro-smelting project with an annual output of 30,000 tons of nickel metal; the second stage is a laterite nickel ore wet smelting project with an annual output of 60,000 tons of nickel metal. The total planned investment of the project is 1.28 billion US dollars, and the project is expected to be completed and put into trial production by the end of 2021.
Hu Qimu, chief researcher of Sinosteel Economic Research Institute, accepted the “securitiesA reporter from the Daily said in an interview: “The short position of Tsingshan Group is a hedging protection for its own products, and there is no problem in operation. Sometimes the varieties that the company hedges in the futures market may not be the varieties that the company operates, but often Correlation in price does not prevent companies from using it as a price risk management tool to hedge against price fluctuations.”
(Article Source:securitiesdaily)