The development road of new electrochemical materials
- Upstream of electrochemical industry chain – bulk chemicals
- Midstream of the electrochemical industry chain – cathode material manufacturers
- Downstream of the electrochemical material industry chain – lithium battery manufacturers
- Industrial development still faces three major risks
Entering 2022, the high prosperity of new energy vehicles will continue, the penetration rate will continue to increase, and the implementation of energy storage battery projects will accelerate, which will further stimulate the strong demand for lithium battery materials.
Among them, new electrochemical materials are one of the key core materials, and the supporting demand is also greatly increasing. Next, let’s take a look at the composition of the upstream, mid-stream and downstream enterprises in the new electrochemical materials industry chain.
Upstream of electrochemical industry chain – bulk chemicals
The main raw materials for the production of cathode materials include nickel sulfate, manganese sulfate, cobalt sulfate, metal nickel, battery-grade lithium carbonate, battery-grade lithium hydroxide, the main auxiliary materials include caustic soda, ammonia water, sulfuric acid, etc. These raw and auxiliary materials are mainly bulk chemical products, and the market supply is relatively sufficient.
It is worth noting that the prices of sulfates (nickel sulfate, cobalt sulfate and manganese sulfate) and lithium salts (lithium carbonate and lithium hydroxide) in the above chemicals have fluctuated greatly in the past, and the prices may change by more than 10% in the middle of the year.
Upstream suppliers include GEM, Australia BHP Billiton, Japan Marubeni, Tianqi Lithium, etc. Among them, GEM mainly sells sulfates such as cobalt sulfate and nickel sulfate, and BHP Billiton mainly sells metal nickel powder. Tianqi Lithium mainly sells lithium salts such as lithium carbonate and lithium hydroxide. The main energy consumed in the production process is electricity, which is directly supplied by the local power supply department.
Midstream of the electrochemical industry chain – cathode material manufacturers
At present, major manufacturers in the industry include lithium battery cathode material manufacturers Easpring Material, Changyuan Lico, Zhenhua E-chem, XTC New Energy, Shanshan (69% of Shanshan), Ronbay, etc. It should be noted that some of the major manufacturers have the background of central enterprises. For example, Easpring Material is a subsidiary of Beijing Mining and Metallurgy Technology Group Co., Ltd.
Changyuan Lico is a subsidiary of China Minmetals Corporation, and Zhenhua E-chem is a subsidiary of China Electronic Information Industry Group Co., Ltd. At present, the cathode material industry has not yet formed an oligopolistic competition pattern, and the market shares of the above six manufacturers are not much different.
Downstream of the electrochemical material industry chain – lithium battery manufacturers
At present, well-known companies in the lithium battery industry include CATL, BYD, Funeng Technology, ATK, Panasonic, Samsung SDI, LG Chem, Tianjin Lishen, BAK Power, Envision Group, etc. From the perspective of shipments, the current global lithium battery industry is in a three-legged situation between China, Japan and South Korea.
The international leading companies are Panasonic, Samsung SDI and LG Chem, the first echelon in China is CATL and BYD, and the second echelon is Funeng Technology, Tianjin Lishen, BAK Power, and Envision Group. Here are more top 50 lithium ion battery manufacturers in China, I hope to bring you some useful information.
Industrial development still faces three major risks
Phenomenon of homogenization
The technical barriers for the production of electrochemical materials are relatively low, and the phenomenon of industrial homogeneity is serious, and the bargaining power of strong lithium battery companies may be insufficient.
The production of electrochemical materials is essentially a process in the lithium battery industry chain, mainly the mixed sintering processing of various metal salts. The process technology is relatively mature, and the technical threshold is not very high. The differences in products between enterprises are mainly reflected in refined management and process control.
Electrochemical material companies are in a period of rapid expansion of production capacity. If they cannot match the growth rate of downstream demand, it is easy to form staged overcapacity. At present, driven by the strong demand in the downstream market, major cathode material companies are actively expanding their production capacity, especially some strong chemical companies are also actively deploying the lithium iron phosphate market recently, and the scale of production capacity under construction is quite large.
However, the growth of the new energy vehicle industry is not linear, and there may be periodic stagnation. Therefore, the slowdown or lower-than-expected growth of downstream industries may lead to periodic overcapacity of cathode materials. As cathode material companies face the inherent deficiencies in the bargaining power of lithium battery companies, once overcapacity occurs, their profit space is bound to face the risk of being squeezed.
Technology route switching risks for electrochemical materials
At present, the cathode materials used in China’s power lithium batteries mainly include two technical routes: lithium iron phosphate and ternary lithium. At the time of early promotion of new energy vehicles in China, lithium iron phosphate dominated. Later, due to the advantages of ternary lithium in energy density and low temperature adaptability, it began to gradually replace lithium iron phosphate and become the mainstream.
However, since 2021, the market share of lithium iron phosphate has overtaken, and it has once again become the mainstream of the market, while the proportion of ternary has declined. This technological change may cause relevant companies to suffer a lot of losses. However, it is worth noting that the current ternary lithium batteries and lithium iron phosphate batteries have considerable technical defects, and the market has placed high expectations on the next-generation solid-state lithium batteries.
Although solid state lithium ion battery will not be commercialized in the short term, if they are brought to the market on a large scale, existing ternary cathode and lithium iron phosphate cathode companies may face a reshuffle.