Supply concerns + demand surge, leading lithium industry leaders to significantly outperform! Shengxin Lithium Energy hits the daily limit, Huabao Fund Non-Ferrous Metals ETF (159876) rises up to 2.5% intraday.

On Friday (March 27), over 11 billion in major funds flowed into the non-ferrous metal sector, making it the top industry among the 31 Shenwan first-level industries in terms of capital inflow! The non-ferrous ETF Huabao (159876), which comprehensively covers leading companies in the non-ferrous metal sectors such as gold, rare earths, and copper-aluminum, quickly surged, with intraday gains peaking at 2.51%, currently up 2.31%.

In terms of constituent stocks, lithium industry leaders significantly led the gains, with Shengxin Lithium Energy hitting the daily limit, Yongxing Materials rising over 8%, and Ganfeng Lithium increasing by more than 6%; gold leaders also performed well, with Chifeng Gold rising over 5% and Shanjin International nearly up 5%; rare earth leader China Rare Earths rose by more than 4%.

On the news front, the Zimbabwean government announced at the end of February the indefinite suspension of all raw mineral and lithium concentrate exports, and the ban has now lasted nearly a month with no news of a lifting, potentially impacting the duration beyond earlier market expectations, with the situation continuing to escalate. This ban has caused small and medium-sized mining enterprises to fall into cash flow crises, supporting the rise in lithium prices.

Industrial Securities pointed out that on the supply side, the disruptions in Jiangxi lithium mines are ongoing, and supply concerns remain. Given the current strong spot demand, the resumption of lithium mining is continuously below expectations, and amidst the background of the ban on Zimbabwean lithium mine exports, lithium prices may continue to experience strong fluctuations in the short term.

Huatai Securities believes that global lithium carbonate is likely to maintain a tight balance in supply and demand. The liquidity contraction and changes in risk appetite brought about by events in the Middle East have led to a weak fluctuation in lithium prices recently. However, considering the supply disruption risks in Yichun, China and overseas regions such as Zimbabwe still exist in the second half of the year, and the high oil prices on the demand side are expected to boost the demand for electric vehicles and energy storage, if in 2026, assuming a neutral expectation (with global new energy vehicle sales growth of 10%-15% year-on-year and energy storage cell shipments growing by 50%-60% year-on-year), global lithium carbonate is expected to maintain a tight balance in supply and demand.

Looking ahead, Huatai Securities favors the rebound opportunities in the non-ferrous metal sector: in terms of gold, historical patterns show that conflicts often lead to a quick rebound once they end, and central banks’ continued purchases provide bottom support for gold prices; in terms of industrial metals, the supply of copper is tight, and domestic inventory is being depleted, while the risks associated with Middle Eastern aluminum production capacity have not been fully priced in, both fundamentals remain supportive; in terms of minor metals, rare earths, tungsten, molybdenum, cobalt, and other varieties are catalyzed by geopolitical conflicts, with expectations for strategic reserves and military stockpiling continuously strengthening. The supply side is highly concentrated in China, making external shocks hard to replace, thus enhancing its resilience and mid-term allocation value, overall, the repair opportunities following the substantial decline are worth actively monitoring.

【The non-ferrous wind is here, the “super cycle” is unstoppable】

The non-ferrous ETF Huabao (159876) and its linked funds (Class A: 017140, Class C: 017141) cover indices comprehensively across copper, aluminum, gold, rare earths, and lithium, encompassing precious metals (hedging), strategic metals (growth), and industrial metals (recovery) across different economic cycles. The full-category coverage allows for better capture of the beta trend of the entire sector. Additionally, this ETF is a margin trading target, serving as an efficient tool for one-click exposure to the non-ferrous metal sector.

As of the end of February, the non-ferrous ETF Huabao (159876) had a latest scale of 2.427 billion yuan, with an average daily trading volume of over 100 million yuan in the past month, ranking first in both scale and liquidity among the three ETFs tracking the same index in the entire market.

Note: The previous on-market abbreviation for the non-ferrous ETF Huabao (159876) was the non-ferrous leader ETF.

Reminder: Recent market fluctuations may be significant, and short-term price changes do not indicate future performance. Investors are advised to make rational investments based on their own financial situation and risk tolerance, paying close attention to positions and risk management.

Risk Warning: The non-ferrous ETF Huabao passively tracks the China Securities Non-ferrous Metal Index. The base date for this index is December 31, 2013, and it was published on July 13, 2015. The index’s performance over the past five complete years is as follows: 2021, 35.89%; 2022, -19.22%; 2023, -10.43%; 2024, 2.96%; 2025, 91.67%. The composition of the index constituents is adjusted as per the rules of index compilation, and its historical performance does not predict future performance. The constituent stocks mentioned in this article are for display purposes only, and descriptions of individual stocks do not constitute any form of investment advice, nor do they represent any fund’s holdings or trading directions under the management. The risk level assessed by the fund manager for this fund is R3 - medium risk, suitable for balanced investors (C3) and above; suitability matching opinions should refer to the sales institution. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, any form of expression, etc.) is for reference only, and investors must be responsible for any investment decisions made independently. Additionally, any views, analyses, and forecasts in this article do not constitute any form of investment advice to readers, nor is there any liability for direct or indirect losses arising from the use of this content. Fund investments carry risks, the past performance of the fund does not represent future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of the fund’s performance. Fund investments should be made with caution.

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