Optimize production capacity layout and standardize lithium battery market order



What is the status quo of the lithium battery companies in the world in industry development? From what aspects should we start to improve the market order? Experts said that at present, the demand for the downstream industries of the lithium battery industry continues to grow. The introduction of relevant documents will strengthen the connection between upstream and downstream companies in the industrial chain, jointly guide the rational return of lithium salt prices, and ensure the stability of the industrial chain supply chain.

1. New energy vehicles demand is huge and lithium salt price needs a rational return

Since the beginning of this year, the new energy automobile industry has continued to maintain a momentum of rapid growth. Data show that from January to September this year, the retail sales of new energy passenger vehicles reached 3.877 million units, an annual increase of 113.2%, forming a monthly upward trend. A new source of power for new energy vehicles. By dismantling the cost distribution of a new energy vehicle, it can be found that the battery system accounts for nearly 40% of the cost of all components. At present, the power batteries of new energy vehicles mainly include ternary lithium batteries, lithium iron phosphate batteries and hydrogen fuel cells.

As the core components of new energy vehicles, the key materials they use include lithium, nickel, cobalt and other metals. Among them, lithium accounts for nearly half of the production cost of cathode materials. The good market of new energy vehicles has driven the growth momentum of power batteries in the upper reaches of the industry. According to public market data, the price of battery-grade lithium carbonate has continued to rise from 68,000 RMB/ton in early 2021. By September this year, the price had exceeded 510,000 RMB/ton, continuing to hit record highs.

New energy vehicles demand is huge and lithium salt price needs a rational return


In the third quarter of this year, the lithium battery industry achieved operating income of 404.60 billion RMB, a year-on-year increase of 87.1%. Professionals said that currently on the market, about 50 kilograms of lithium carbonate are used in the production of a new energy vehicle. Although the actual transaction price of lithium carbonate may not reach the highest market price due to reasons such as manufacturers' stocking up in advance, the cost premium is still considerable.

2. Alleviate the contradiction between lithium supply and demand

On the one hand, power battery companies in the world are operating at full capacity and on the other hand, many car companies have raised car prices. What is happening in the lithium battery industry? Industry insiders believe that the high price of lithium is mainly due to the imbalance between supply and demand. Industry professionals said that whether it is lithium salt or upstream minerals, it takes a certain period of time for resource construction and expansion, and it is difficult to release new production capacity in the short term, which has caused price fluctuations.

Experts said that behind the rise in lithium prices is actually the contradiction between supply and demand caused by the continuous outbreak of demand for new energy vehicles and the difficulty in keeping up with the supply of upstream materials. Although lithium is not a scarce resource, the huge demand makes it difficult to guarantee the supply of upstream lithium mining and smelting. In order to ensure the coordination and stability of the supply chain of the lithium battery industry chain, the relevant documents clearly state that lithium battery companies should reasonably formulate development goals based on actual conditions and industry trends.

Alleviate the contradiction between lithium supply and demand


Under the premise of stable supply of key materials, sufficient investment in R&D and innovation, and sufficient supporting funds, moderately expand production scale according to time and demand, optimize industrial regional layout, and avoid low-level homogeneous development and vicious competition. Encourage in-depth cooperation among upstream resource companies such as lithium nickel and cobalt, power battery recycling companies, lithium battery terminal application companies, system integration, channel distribution and other enterprises. Establish a long-term mechanism by signing long-term orders and technical cooperation to guide upstream and downstream to stabilize expectations, clarify quantity and price, guarantee supply, and win-win cooperation.

People in the lithium battery production industry said that this is a symbolic policy for the entire industry. With the release of relevant documents, the lithium battery industry will not be able to expand production capacity without restriction in the future. Experts believe that, on the one hand, the market mechanism itself will achieve an adjustment effect, and on the other hand, relevant departments are also accelerating the connection between supply and demand in the upstream and downstream of the industrial chain and market supply guarantee. After a period of time, the development of the new energy automobile industry will maintain a steady growth rate, and the upstream supply can be guaranteed.

3. Recycling of decommissioned batteries has broad prospects

In order to supplement the supply of lithium carbonate and promote the orderly development of the power battery industry, what other measures can be taken? Industry experts said that it is worth considering to accelerate the improvement of the waste battery recycling system. Experts said that decommissioned power batteries can be widely used in power system energy storage, communication base station backup power, low-speed electric vehicles and small distributed household energy storage, wind and solar hybrid, electric forklifts and other fields.

Generally, about 60% of the initial capacity of the battery can be used. Depending on the usage scenario, the service life can range from several months to several years. Since the release of relevant documents on China's mineral resource planning, China has reserved rare earth metal minerals as strategic resources. Therefore, the recycling of metal elements in power batteries can not only better develop the circular economy, but also effectively alleviate China's long-term dependence on such resources. However, the waste utilization of power batteries still has a long way to go.

Recycling of decommissioned batteries has broad prospects


Relevant staff said that at present, many host manufacturers have established battery recycling business. However, some power batteries did not flow into formal channels. Instead, they were purchased at high prices and improperly disposed of by unqualified, high-polluting small factories, causing hidden dangers of secondary environmental pollution. Professionals said that this may be due to various reasons such as the lack of awareness of new energy vehicle users on power battery recycling, the high recycling price of small workshops, the limited number of formal recycling companies, and the immature recycling technology.

Many experts believe that to speed up the recycling of power batteries, in addition to strengthening the implementation of the producer extension system, it is also necessary to strengthen publicity and improve consumers' awareness of environmental protection. At the same time, companies should also speed up the transformation of intelligent equipment to fundamentally solve the industry problems of high cost and low profit.

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