Non-ferrous metals companies extend upstream to gain greater benefits

Under the influence of a significant increase in metal prices, the performance of non-ferrous metals listed companies in 2010 has achieved a substantial increase. In the face of the market conditions that may continue to recover in 2011, gold companies have remained cautiously optimistic about the high price of gold, and neither planned output nor revenue has grown significantly. More smelting enterprises will continue to extend upstream and obtain greater benefits from rising prices by acquiring more resources and expanding the captive power plant capacity.

Cautiously optimistic about the industry situation In 2010, the recovery of the non-ferrous metals industry was positive. However, in 2011, listed companies maintained cautious optimism in production expansion.

According to China Gold Bullion, the high volatility of gold prices has brought profits to the company and also increased the cost of resource acquisitions. The competition of mining companies in resources, talents, technology and other fields has increased the difficulty and risk of the company's continued development. The improvement of standards such as safety, environmental protection, energy saving and emission reduction put forward higher requirements for the development of the company. The rise in raw materials, energy prices, and labor costs has put pressure on business cost control. The company plans to produce 69 tons of standard gold in 2011 and realize sales revenue of 23.1 billion yuan. In 2010, the company achieved sales revenue of 21.647 billion yuan, production (processing) standard gold 85.82 tons, and mineral gold 19.70 tons.

Shandong Gold also believes that in the current macro environment, the company's risk is the price of gold, which is mainly affected by the international market. In 2011, the company plans to achieve 20 tons of self-produced gold production. Calculated according to the average price of gold in 2010, the company achieved sales revenue of 30 billion yuan and profit of 1.6 billion yuan. The company's gold production in 2010 completed 19.41 tons (self-produced gold), and achieved operating income of 31.515 billion yuan.

Jiaozuo Wanfang analyzed in the annual report. Viewed from the development trend of the industry, driven by market demand, the prosperity index of the non-ferrous metals industry has rebounded. However, the excessive production capacity and the structural contradictions of the industry still restrict the price increase, and the industry competition is still severe.

Strive to extend the upstream price of non-ferrous metals, and companies with high resource self-sufficiency will receive more revenue. However, due to the increase in prices of upstream resource products, energy, and labor, smelting enterprises have increased their costs. Therefore, extending to the upstream has become an urgent task for non-ferrous metal companies to complete in 2011.

Zhuzhou Metallurgical Group believes that the company is currently a single smelting enterprise and does not have its own mines. The sales of its products are basically dependent on downstream companies. Once the chain is broken, raw material procurement and product sales will be greatly affected and will also directly affect the company's performance. In 2011, the company plans to complete a total lead and zinc output of 610,000 tons, and achieve an operating income of 15 billion yuan.

Aluminum Corporation of China stated that it will accelerate the development of overseas resources. While continuing to promote the Australia Aurukun project, the Sarawak project in Malaysia, the Saudi Arabian aluminum project and the Guinea iron ore project, it actively participated in the global resource allocation. In areas rich in bauxite and energy resources, we will continue to seek development opportunities. The company expects alumina production in 2011 to increase by approximately 18.1% from 2010, and electrolytic aluminum production is expected to increase by approximately 4.86% from 2010.

Jiaozuo Wanfang, who suffered from power cuts in 2010, said that due to the lack of self-provided power equipment, the increase in power supply prices will lead to a decrease in cost competitiveness of the company. The company will continue to implement coal-electricity-aluminum-aluminum processing integration. Strategy, extend the industrial chain, increase the ability of enterprises to resist risks. Specifically, in order to reduce the cost of power supply, the company plans to invest in the construction of two sets of 300,000 kilowatts of thermal power units. In 2011, preparations for project construction will be carried out and project construction will be promoted. It is estimated that the project funds will require 2-42.7 billion yuan. The company will raise funds through various ways such as self-raising and borrowing.