From the long list of lithium battery materials to see the "dark battle" of battery companies
The production capacity that key materials can release in the short term is so small. Whoever can get the raw materials has more say in the car companies.
In order to ensure the stable production of power batteries, the recent competition between battery companies in the upstream can be said to be increasingly fierce. In fact, it has been circulated earlier in the market that in the face of rapidly erupting demand, some head battery companies have implemented "buyouts" on the production lines of lithium iron phosphate, lithium hexafluorophosphate, and high nickel cathodes of upstream raw material companies in order to meet their own battery production needs. "The model makes it difficult for other battery companies to get the goods.
In fact, judging from the acceleration trend of global automobile electrification, the demand for power batteries will be released quickly in the next few years. It can be said that in the next one to two years or longer, how much raw materials can be obtained by battery companies basically determines How many batteries are delivered means how much market share can be won.
In the case that some of the existing and short-term foreseeable production capacity is "buy out", other more battery companies are trying their best to lock in the remaining capacity, and they are signing long-term orders.
01 Intensive signing of long-term orders for lithium hexafluorophosphate
Since the beginning of this year, the most popular lithium battery material should be lithium hexafluorophosphate. The price has skyrocketed and once again stood at a high of 400,000 yuan/ton, causing the performance of related companies to rise sharply. Kang et al.'s performance in the first half of the year all rose sharply.
It is worth noting that lithium hexafluorophosphate, which is the core raw material of the electrolyte, has high barriers to entry and a long expansion period. Although many companies have large-scale expansion plans, the production capacity is still very limited in the short term or even in the next one to two years. ". Industry data shows that the supply and demand gap of lithium hexafluorophosphate this year is expected to be 6,000 tons. Next year, the gap will expand to 17,000 tons. In 2023, the gap is expected to be 35,000 tons, and the gap in 2024 will exceed 60,000 tons.
Since this month, battery and electrolyte manufacturers including BYD, Funeng Technology, and Jiangsu Cathay Pacific have begun to take action for the raw materials of lithium hexafluorophosphate in the next few years.
Battery and vehicle companies have personally started to grab the core raw materials of the electrolyte. Among them, BYD's 3 orders reached 25,600 tons, and the demand in the next one and a half years will reach 14,500 tons.
According to the industry's general standard of 125 tons of lithium hexafluorophosphate for 1GWh, BYD's battery output is expected to be at least 115GWh before the end of 2022.
According to statistics, the battery capacity of BYD (Fudi Battery) that has been built, is under construction, and planned in 9 cities across the country has been around 200GWh, and these battery capacities are expected to be fully put into production before 2023. Obviously, battery companies such as BYD (Fudi Battery) and Funeng Technology have personally left the market to sweep the goods on a large scale in order to plan ahead and lock in effective long-term orders in advance to avoid affecting battery output due to insufficient supply of raw materials.
02 Strong demand for high nickel, leading companies frequently seek stable supply guarantee
Similarly, the lock-in of raw materials also occurs in high-nickel materials.
Since the beginning of this year, although lithium iron phosphate has been extremely popular, high nickel has actually performed equally well.
According to data, in the first half of this year, the output of ternary cathode materials in the Chinese market was about 172,500 tons, which was a year-on-year increase of 165.38% from 65,000 tons in the same period last year. In terms of specific materials, the output of NCM523, NCM622, and NCM811 (high nickel) in the first half of this year were 81,500 tons, 21,800 tons and 61,600 tons, respectively. Among them, the output of high nickel materials has accounted for as high as 35.71%, and the year-on-year growth rate is as high as 362.54%. In the same period, the proportion of NCM523 dropped from 54.91% last year to 47.28% in the first half of this year, and the growth rate was much lower than that of high nickel materials.
Behind the rapid increase in the output of high nickel materials is the strong demand for high-performance power batteries in overseas markets.
As international OEMs such as Volkswagen, BMW, Daimler, Hyundai, GM, Ford, PSA and other international OEMs accelerate their transition to electrification, mainstream international car companies are more inclined to high-nickel batteries in the technical route of high-end passenger vehicles, including CATL, The output and shipments of high-nickel batteries from battery companies such as LG New Energy, Panasonic Battery, and Funeng Technology are all increasing rapidly.
In fact, high-nickel cathode materials have also become "scarce" or even "buy out" trends.
According to Battery China, in the first half of this year, domestic manufacturers of high-nickel materials mainly include Tianjin Bamo, Rongbai Technology, Beiterui, Guangdong Bangpu, Changyuan Lithium, Guizhou Zhenhua, Dangsheng Technology and other companies. Among them, only Tianjin Bamo and Rongbai Technology have an output of more than 10,000 tons.
Based on the strong demand for high-nickel batteries in the international market, domestic high-nickel materials are also in short supply. The production capacity of some high-nickel materials companies can currently only meet the needs of a few customers.
Also out of concerns about the nervousness of high-nickel materials in the next few years, Funeng Technology has invested heavily to lock in long-term orders.
On July 26, Rongbai Technology issued an announcement stating that the company received a long-term purchase order for high-nickel ternary cathode materials from downstream customer Funeng Technology, and recently signed a cathode material procurement framework agreement. According to the agreement, Funeng Technology will purchase 5,505 tons and 30,953 tons of high nickel ternary cathode materials from Rongbai Technology in the second half of 2021 and the entire year of 2022.
If estimated according to the current price of high nickel materials, the estimated value of the two large purchase orders is close to 8 billion yuan.
It is worth noting that in order to ensure the smooth execution of the long-term order, both parties have also clarified the responsibility for breach of contract:
If Funeng Technology's annual purchase quantity does not complete 80% of the forecasted quantity, it will compensate Rongbai Technology in a certain proportion of the corresponding purchase price of the uncompleted quantity (80% of the annual forecasted quantity minus the purchased quantity).
Rongbai Technology promises to guarantee the quantity demanded by Fu Energy Technology in the agreement. If 80% of the annual forecast quantity is not completed, it will be based on the uncompleted quantity (80% of the annual forecast quantity minus the shipped quantity) corresponding to a certain proportion of the payment Compensation to Funeng Technology.
Data show that in the first half of this year, the output of Rongbai Technology's high-nickel materials is about 18,100 tons. Judging from the scale of the high-nickel materials that have been locked, it has already occupied the current Rongbai Technology's large production capacity.
Regarding this long-term order, Funeng Technology bluntly stated that cathode materials are the core raw materials of the company's products. "The implementation of the agreement reduces the adverse impact of fluctuations in the supply and demand of raw materials on the company and ensures the company's supply of high-quality raw materials."
An industry insider also told Battery China that Funeng Technology signed a huge purchase order with Rongbai Technology to lock a part of the high nickel material production capacity. At present, the domestic high nickel production capacity is basically divided by several top domestic and foreign battery companies and car companies.
And behind Funeng Technology's lock in the large order of high nickel materials is that it has entered Daimler's high-end passenger car platform and supplied NCM811 battery products to Daimler in batches.
Coincidentally, Yiwei Lithium Energy also carried out a large-scale layout on high-nickel materials this year. In May of this year, Yiwei Lithium Energy established a joint venture company with Beiterui and SKI. The joint venture company will plan to build 50,000 tons of high-nickel ternary materials per year, hoping to achieve self-sufficiency in some high-nickel materials.
Yiwei Lithium Energy stated that the establishment of a joint venture company with Beiterui and SKI aims to ensure the production capacity and quality of the high-nickel ternary cathode material for the lithium battery of the joint venture by combining the advantages of technology research, market development, and operation management of all parties.
According to the editor, in the next few years, driven by the global mainstream car companies and rapid technological changes, the demand for high nickel batteries will continue to explode, and the corresponding demand for cathode materials will also explode in a stepped manner, starting from stable materials. From a supply perspective, it is expected that the phenomenon of "binding" long orders of related materials will become more frequent in the future.
