[SMM Analysis] Chile's SQM Exceeds Q2 Profit Projections Amid Tighter Lithium Supply-Demand, Sales Up 59% YoY

India's battery manufacturing supply chain remains heavily import-dependent across every stage, from raw mineral inputs through cell production, with domestic capacity covering less than 1% of near-term demand. India held just 2 GWh of commissioned lithium-ion cell manufacturing capacity as of 2026, against a demand pipeline of approximately 260 GWh generated by competitive tenders in the same period a gap that reflects structural exposure rather than a temporary shortfall in the country's energy storage buildout. Upstream, critical raw materials lithium, cobalt, nickel, and graphite are sourced at near-100% import dependency. India has limited domestic reserves of battery-grade lithium and currently lacks refining infrastructure to process what is available, leaving the country fully exposed to global lithium and battery raw material pricing and export availability from producing regions abroad. Midstream, upstream chemical components cathode active materials, anodes, separators, and electrolytes are sourced almost entirely from Chinese and Korean manufacturers, including inputs used at facilities that brand themselves as domestic producers. China alone supplies an estimated 63%-85%+ of India's lithium-ion cell imports and controls 85%-98% of global capacity across every major battery supply chain node, meaning even India's growing pack-assembly base remains structurally tethered to a narrow band of offshore component suppliers. Downstream, battery pack assembly is the one segment where India has developed meaningful local activity, though this captures only a fraction of total supply chain value the high-margin, high-complexity work remains concentrated at the cell and component level, where import reliance is near-total. India's total battery and cell import bill reached approximately $2.8-3.1 billion in 2023-24, underscoring the scale of value still flowing offshore at the cell stage. Domestically manufactured cells currently carry a 25%-40% cost premium over imports, driven by insufficient production scale, higher financing costs, and an underdeveloped domestic supplier ecosystem for cell-input materials that forces Indian manufacturers to source precursor materials at spot or contract prices rather than the volume-discounted terms available to vertically integrated overseas producers. Scale economics compound this: facilities operating around 5 GWh run at approximately -10% EBITDA, with breakeven only near 10 GWh and positive margins requiring 20 GWh or more thresholds most of India's announced 226 GWh capacity pipeline through 2035 has yet to reach. India's near-term supply chain strategy is prioritizing downstream localization battery containers, energy management systems, SCADA infrastructure, and pack assembly supported by a 20% domestic content requirement on grid-scale battery energy storage system tenders. Raising that requirement toward 100% would lift total capital expenditure by approximately 30% for a benchmark 100 MW, 2-hour BESS system, highlighting the direct cost tension between accelerating supply chain localization and keeping storage projects commercially viable. A phased roadmap frames the path forward: downstream assembly and component localization is achievable within 0-3 years; cell manufacturing scale-up to the 10-20 GWh viability threshold spans 3-10 years, with upstream technology and input dependency persisting throughout; and full supply chain integration including domestic critical mineral refining and reduced reliance on imported cathode, anode, and electrolyte materials is not expected before 10-15+ years. SMM View: India's battery supply chain gap sits most acutely at the upstream and midstream stages, where raw material and precursor sourcing remain almost entirely offshore regardless of gigafactory announcements downstream. This structural profile positions India as a substantial long dated demand pool for lithium and battery raw materials, including African spodumene and precursor exporters, provided pricing and logistics can compete with entrenched supply relationships already built around Chinese and Korean input chains.

The Democratic Republic of Congo is advancing plans to establish a major battery precursor manufacturing hub in Lualaba province, positioning itself within the lithium-ion battery materials supply chain as the country seeks to move beyond raw mineral exports. The government approved the Musompo Special Economic Zone as a priority project in February 2026, marking a step toward integrating DRC's mineral base into the cathode-active-material stage of the battery value chain. From Minerals to Lithium-Ion Battery Materials: Musompo is designed to produce nickel-manganese-cobalt (NMC) precursor materials the cobalt- and nickel-bearing intermediate that is combined with a lithium source (typically lithium carbonate or lithium hydroxide) to produce NMC cathode-active material, one of the two dominant lithium-ion battery chemistries alongside LFP. The 900-hectare industrial zone reflects the DRC's broader strategy to capture value at the precursor stage rather than exporting cobalt in raw or intermediate form to Asian cathode producers. Scale and Investment Timeline: The zone is expected to attract approximately $2 billion in private investment once fully developed, with initial construction requiring more than $200 million. Metric, the 900-hectare project was approved as a priority project in February 2026 to produce NMC battery precursor materials, carrying an estimated construction cost of over $200 million and expected to draw approximately $2 billion in private investment while creating around 25,000 direct and 60,000 indirect jobs. DRC's Role in the Lithium Battery Materials Chain: Global lithium-ion battery demand continues to expand on the back of EV adoption and energy storage growth, sustaining strong demand for both NMC and LFP cathode inputs. While DRC itself is not a lithium producer, its cobalt supply position gives it direct relevance to the NMC segment of the lithium battery materials market, which competes with LFP (increasingly supplied by lithium chemical producers rather than cobalt) for cell manufacturing share. Historically, the precursor and cathode-active-material stages of this chain where cobalt, nickel and lithium chemicals are converted into battery-ready materials have been concentrated outside Africa, primarily in China. Musompo is intended to shift part of that midstream capacity onto the continent. Africa's Lithium and Battery Materials Chain Remains Underdeveloped: Africa's raw lithium and cobalt resource base remains far ahead of its downstream battery materials capacity. Zimbabwe has advanced spodumene concentrate production and is moving toward early-stage beneficiation, while Zambia and the DRC are pursuing regional cooperation on battery mineral value addition. Musompo adds a precursor-stage node to this emerging landscape, though it does not itself close the loop with a domestic lithium chemical supply any NMC precursor output would still require lithium carbonate/hydroxide sourced externally, likely from Chinese refiners given current African lithium projects largely export spodumene concentrate rather than converting it locally. Conclusion: Musompo represents a meaningful step in the DRC's push to capture more value from the lithium-ion battery supply chain, specifically on the NMC precursor side. Its success depends on execution: power availability and infrastructure buildout in Lualaba remain the primary constraints, and its impact on the broader African lithium battery materials picture will be limited unless paired with progress on domestic lithium conversion capacity elsewhere on the continent e.g., Zimbabwe, Mali. SMM View: Musompo strengthens the cobalt/nickel side of Africa's NMC precursor capacity but does not directly address the continent's lithium conversion gap spodumene concentrate from Zimbabwe, Mali and Namibia is still overwhelmingly exported for offshore conversion into lithium chemicals. The more consequential development for Africa's lithium battery materials value chain will be whether beneficiation projects on the lithium side (rather than the cobalt side) can achieve similar SEZ-backed investment momentum.

[Zhang Xue Visits Ampace Today, Says Zhang Xue Electric Motorcycle Could Enter Mass Production as Early as Next Year] ZXMOTO founder Zhang Xue visited Ampace for a field trip and exchange on August 20. Zhang Xue stated that the Zhang Xue electric motorcycle could enter mass production as early as next year. In May of this year, Ampace and ZXMOTO had already begun discussions on specific collaboration plans. Ampace is a lithium battery enterprise jointly established by CATL and ATL.