Morgan Stanley: Construction starts on the lower reaches of the Yarlung Tsangpo River hydropower project, benefiting the demand for cement, steel, and non-ferrous metals.

Morgan Stanley released a research report stating that the construction of the hydropower project in the lower reaches of the Yarlung Tsangpo River in Tibet officially started on July 19, with a total investment of 1.2 trillion RMB and an installed capacity of 60 to 70 GW, equivalent to three times that of the Three Gorges Project. The project construction period is expected to be 18 to 20 years, and will be operated by the newly established central enterprise, Yajiang Group. It is expected that during the construction phase, the cement and steel industries will directly benefit, with the total cement demand for the project estimated to be 20 to 30 million tons, with an annual demand of 10 to 15 million tons. The report indicates that Huaxin Cement's production base in Tibet is only 400 kilometers away from the project, and Morgan Stanley expects Huaxin Cement to be the biggest beneficiary. Meanwhile, CNBM and Anhui Conch Cement's production capacities in Tibet will also benefit. The report also points out that the later power station equipment and transmission cables will drive the demand for copper and aluminum materials. After the project is operational, the annual electricity generation is expected to exceed 300 billion kilowatt-hours. In addition to priority power export, sufficient power supply may stimulate investments in local data centers and other electricity-intensive projects, further boosting the demand for copper and aluminum, but may put pressure on the demand for thermal power and coal.