Industry new
Magnetic material as the core midstream material in the electronic information industry
As the core midstream material of the electronic information industry, magnetic materials have strong functionality and wide application, and they have broad market prospects. Under the background of the State's "Twelfth Five-Year Plan" to develop new industries, with the gradual maturity of emerging industry technologies and the gradual expansion of industrial scale, the magnetic materials industry will usher in a gratifying spring.
We are optimistic about the Nd-Fe-B industry and believe that the Nd-Fe-B industry is in a long-term boom cycle, and most of the downstream demand has strong rigidity. We can divide the downstream of NdFeB into three categories: demand for miniaturization, demand for energy conservation, and cross-cutting demand. The demand for miniaturization is basically irreplaceable, the demand for energy conservation can be the strongest alternative, and the demand for cross-linking can be substitutable, mainly depends on the product. Is the middle or low grade or high grade.
We use optimistic and neutral scenarios to predict downstream demand. Under the optimistic scenario, we estimate that the 11-year neodymium-iron-boron magnet roughstock demand will be around 75,000 tons, and the magnetic material and neutral demand will be around 61,000 tons. According to the calculation of the national rare earth mining index, the supply of neodymium-iron-boron will be reduced by more than 30% in 11 years. The imbalance between supply and demand is the fundamental logic of NdFeB investment.
We judge that large-scale NdFeB producers can smoothly pass on the pressure of rising costs and maintain rapid growth in sales revenue while maintaining gross profit margins. On the other hand, we believe that the price of rare earths is unlikely to drop sharply. NdFeB companies are expected to enjoy high gross tonnage for a long time and usher in a period of gold investment.
From the perspective of production capacity, we recommend the industry leading Zhong Ke San Huan and Ningbo Yunsheng. Zhongke Sanhuan and Ningbo Yunsheng are China's first and second largest producers of NdFeB, with stable downstream demand and strong cost transferability. Considered from the upstream, the supply of raw materials for large manufacturers is also relatively stable.
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