GUANGZHOU NPP POWER CO., LTD
NO.67, Lianglong Road
Huashan Town
Huadu District
Guangzhou
Guangdong Province
P. R. China
Tel: +86 20-37887390
Email: info@npplithium.com
GUANGZHOU NPP POWER CO., LTD
NO.67, Lianglong Road
Huashan Town
Huadu District
Guangzhou
Guangdong Province
P. R. China
Tel: +86 20-37887390
Email: info@npplithium.com
Since 2022, the new energy logistics vehicle market has continued to grow at a high rate, and the market prospect is bright. According to the analysis of the Electric Vehicle Resources Industry Research Institute, the cumulative sales of new energy logistics vehicles from January to September 2022 are 134,000 units, which has surpassed the whole year of 2021 Total sales of 122,000 vehicles. But behind the market development, there are still many “bad things”. Let me ask the person in charge of a power battery company and a new energy logistics vehicle company, what is the most painful thing in 2022? There is no doubt that the continuous price increase of lithium iron phosphate raw materials must be the first “bad thing” to bear the brunt.
Beginning in August 2021, lithium iron phosphate began to enter a crazy growth mode, with a year-on-year growth rate of up to 256.9%. In October 2022, the unit price of lithium iron phosphate has increased to 165,000 CNY/ton, compared with 86,000 CNY/ton in the same period last year .
The price of lithium carbonate has repeatedly hit new highs! In October 2022, the unit price of lithium carbonate was 578,000 CNY/ton, a year-on-year increase of 207.1%, and a month-on-month increase of 61,000 CNY. The latest data on November 5 showed that the price of lithium carbonate continued to break through high prices, reaching 596,000 CNY/ton, only one step away from of 600,000 CNY. Looking back at January 2021, the price of lithium carbonate was only 72,000 CNY/ton.
As far as the domestic market is concerned, according to the data of the China Power Battery Industry Innovation Alliance, the total installed capacity of power batteries in my country will be 26.2GWh in 2021, of which lithium iron phosphate batteries account for 51.7%, exceeding the market share of ternary batteries; January-September 2022 The cumulative installed capacity was 193.7GWh, and the proportion of lithium iron phosphate batteries continued to expand to 60.1%. Based on the two major advantages of safety and cost, lithium iron phosphate batteries have already occupied a dominant position in new energy vehicles. In the new energy logistics vehicle market, as many as 98% of sales vehicles are equipped with lithium iron phosphate batteries.
The rapid strengthening of downstream market demand has brought strong pressure on the supply of upstream raw materials. Lithium carbonate is processed and refined through lithium ore. Lithium ore is described as “white oil”, but lithium is not a scarce resource on the earth. At present, the world’s proven lithium ore reserves exceed 100 million tons, which can fully meet need. Therefore, in the past, more manufacturers focused on rare minerals, such as nickel ore and cobalt ore. Especially from 2018 to 2020, the price of lithium is low, mines have reduced production, and the epidemic has caused the construction of some salt lakes to be interrupted, and domestic investment in lithium mines has dropped significantly.
And no one thought that the explosion of electric vehicles would be so rapid in 2021. According to the data from the China Association of Automobile Manufacturers, the sales of new energy vehicles will reach 6.5 million in 2022, a year-on-year increase of 83%.
Such a fast growth rate caught the upstream lithium mines off guard. However, lithium mining capacity has not climbed so rapidly. According to relevant data, the construction period of upstream lithium ore is 3 to 5 years, the construction period of salt lake is 5 to 8 years, and the construction period of cathode materials is 1 to 1.5 years, and the downstream lithium battery can be completed and put into production at the fastest half a year. Therefore, the rapid growth of downstream demand and the delay in the supply of upstream resources have brought about a serious mismatch between supply and demand, a serious imbalance between supply and demand, and a rapid rise in the price of upstream raw materials.
From the perspective of enterprises, the concentration of lithium resources in the world is relatively high. The main production capacity is Albemarle ALB in the United States, FMC in the United States (Livent), Talison in Australia (Tianqi Lithium Industry accounts for 51%, and ALB accounts for 49%. %) and Chilean mining and chemical industry SQM (Tianqi Lithium holds 25% of the shares) are monopolized by four companies, accounting for about 90% of the global production capacity. There is a gap between us. According to the data of the US Geological Survey, my country’s lithium resources are not scarce, accounting for 7.1% of the global lithium resources, of which brine lithium mines are the main ones, accounting for 81.5% of my country’s lithium resources. Although lithium extraction from salt lakes has the advantage of relatively low cost, due to the late development of its technology, it is far less mature than that of ore lithium extraction. Therefore, the development and utilization of lithium resources in my country is far lower than that in Australia (almost all lithium resources in Australia are in the form of ore. Its lithium resources account for 22.3% of the world’s total, but it contributes nearly half of the world’s output). In particular, China, as the world’s largest lithium consumer, has a huge gap in lithium resource output, and its dependence on foreign sources of lithium raw materials is high. China’s lithium ore import dependence is about 70%, which also leads to the country with the largest demand for lithium ore resources. No price control.
In September this year, the Department of Raw Materials Industry of the Ministry of Industry and Information Technology in China held a symposium on “Development of the Lithium Resource Industry”, and proposed a package of policy measures from the aspects of “more development, stable imports, reduction, and promotion of recycling”. The purpose is to cooperate with all parties to speed up the development and utilization of domestic resources, form supply capacity as soon as possible, alleviate high import dependence, and stabilize raw material prices.
The Tram Resource Industry Research Institute believes that there will still be an upward trend, but the fluctuation of the increase will slow down.
Next year, the mismatch between upstream and downstream supply and demand will still exist, and the development of new energy vehicles will exceed expectations. Under the dual-drive model of policy and market, the development is certain, but the degree is difficult to predict. Over the past two years, the expected development has been obvious. However, as an upstream resource party, they are often cautious in capacity planning, and have established targets for annual production capacity, which often has a mismatch with the unpredictable development of the downstream market.
At the same time, the status quo of China’s dependence on imports of lithium ore resources cannot be changed in the short term. Overseas lithium ore resource suppliers have a certain degree of monopoly, and it is difficult to exchange quantity for price. Under such circumstances, even as the largest customer, my country lacks bargaining power.
From 2021, battery factories will increase the layout of upstream raw materials. Among them, CATL, BYD, Gotion High-tech and EVE Lithium Energy will all deploy upstream lithium resources in the form of equity participation and joint ventures. New production capacity will be released one after another, and the integrated layout will begin to emerge. It is expected to play a certain role in stabilizing raw material prices.
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In addition, according to the calculation of Shanghai Nonferrous Metals Network, after entering 2023, with the successive release of many projects such as Salt Lake and pyroxene, the growth rate of lithium resource supply may officially exceed the growth rate of demand in 2023.
Therefore, based on multiple factors, it is expected that the high price of upstream resources will continue in 2023, but the fluctuation of the increase will slow down, and it is optimistic that there will be a correction in the second half of the year.