Lithium carbonate | the price is skyrocketing! Will the battle for lithium continue?

Recently, the price of lithium-related battery materials has continued to rise, hitting a new high.

Data show that as of May 6, the price of battery-grade lithium carbonate has more than doubled from last year's "trough" of 38000 yuan / ton to 89000 yuan / ton (average price), while lithium hydroxide has risen from 60, 000 yuan / ton to 82500 yuan / ton (average price).

Industry insiders said that the continued rise in the price of lithium-related battery materials is driven on the one hand by the strong demand for power batteries of downstream new energy vehicles; on the other hand, it is also subject to the current tight supply and demand of lithium materials. At the same time, as a linkage reaction of the rising price of lithium materials, enterprises in the power battery industry chain are joining in the war of "grabbing lithium" one after another.

01 Battery Raw material "first Brother"

The continued rise in the price of lithium materials has really stirred people's hearts. But helpless, who makes lithium have such a strong dominant position in the lithium battery, the most mature technology route of new energy vehicles at this stage?

As we all know, traditional lithium batteries include lithium iron phosphate, ternary nickel-cobalt-aluminum and nickel-cobalt-manganese, lithium manganate, lithium cobalt and other types of batteries, and all of the above types of batteries must use lithium.

Even new batteries such as graphene batteries (graphene is used as a doping material to modify the electrode material, but lithium is still a necessary element), or solid-state batteries that are expected to achieve mass production in the future (solid-state batteries replace the liquid electrolyte of existing lithium batteries with solid-state electrolytes, and negative electrodes will also develop to lithium metals with higher theoretical capacity and low redox potential). All of them are inseparable from lithium materials.

This means that, different from the "one-sided" status of materials such as cobalt and nickel, lithium materials can "ignore" the fluctuation of mainstream battery market share in lithium-ion battery system (such as ternary battery and lithium iron phosphate battery). It can also be "immune" to the impact of newly innovative battery technologies such as cobalt-free batteries and ultra-high nickel batteries. More able to "cross generations", in solid-state batteries and other next-generation battery technology still occupies an important place, has become the battery raw materials "brother".

With the continuous development of the new energy industry, with the status that no one can shake, the demand for lithium materials is becoming more and more exuberant.

Take lithium carbonate as an example (an important raw material for lithium iron phosphate batteries). According to estimates by relevant institutions, with the sustained and rapid growth of the number of new energy vehicles in the next five years, the global penetration rate of new energy vehicles is expected to reach 20% in 2025, and its sales will exceed 18 million. Taking into account other lithium carbonate application scenarios such as energy storage, 3C consumer electronics and traditional industries, the global demand for lithium carbonate is expected to reach 1.24 million tons in 2025, 3.6 times that of 2020.

There is a great demand for lithium materials at one end, but from the point of view of its supply at the other end, the mines of lithium mining enterprises such as Altura and Wodgina are still closed, while traditional global lithium giants such as Arbor, livent and SQM have clear capacity expansion plans, but the release of new capacity will take time. Considering that the supply of lithium materials lags behind, the above-mentioned institutions predict that by 2025, the global lithium carbonate gap will exceed 160000 tons, accounting for 13% of the gap.

It is not difficult to imagine that the price of lithium materials may continue to rise or even hit new highs in the future due to the imbalance between supply and demand. In this context, power battery manufacturers who are ambitious in planning battery capacity expansion are bound to make ensuring a stable supply of lithium materials one of their top priorities.

02 join the war of "snatching lithium"

Like the era of power battery leader Ningde, in order to ensure a stable supply of battery raw materials, through pre-layout, at present, it has formed a closed-loop industrial map of "copper, cobalt, lithium, nickel resources-lithium carbonate / lithium hydroxide-cathode materials (including precursors)-recycling".

At the same time, Guoxuan Hi-Tech also joined in the battle for lithium. On February 28th, Guoxuan Hi-Tech signed a strategic agreement with the people's Government of Yichun City, the former will invest 11.5 billion yuan in the construction of lithium-ion new energy industry project in Yichun Economic Development District. According to the agreement, the project will include industrialization projects such as the production of lithium carbonate and supporting materials for lithium batteries. It is reported that in the later stage, the two sides will also promote the integration of the upstream and downstream of the industrial chain according to the strategic planning for the development of new energy industry and the advantages of Yichun lithium mine resources.

Abroad, in January this year, foreign media reported that LG New Energy and lithium resources giant SQM signed a long-term supply contract. Under the agreement, SQM will supply battery-grade lithium carbonate and lithium hydroxide to LG New Energy for a total of 55000 tons from 2021 to 2029. "LG new energy continues to expand its capacity construction scale, which in turn has a strong demand for lithium battery raw materials." Industry insiders said.

It is worth noting that the soaring price of lithium materials has even alarmed downstream car companies.

In early April, foreign media reported that BMW Group and Livent signed a multi-year procurement contract of about 285 million euros in order to lock in a stable supply of lithium materials in the future. Under the contract, Livent will supply lithium materials directly to BMW Group cell manufacturers from 2022. This means that Livent's lithium resources will most likely be supplied directly to existing BMW battery suppliers such as Ningde Times, Samsung SDI and Yiwei Lithium Energy.

In fact, as early as the end of 2019, BMW signed a long-term supply agreement with Ganfeng Lithium for 540 million euros. It is reported that the agreement clearly stipulates that Ganfeng Lithium Industry will supply the variety and quantity of lithium chemical products to suppliers of batteries or cathode materials designated by BMW in Germany between 2020 and 2024.

In addition, in November last year, Tesla extended the lithium supply contract with Livent until 2021.

It is worth noting that although the price of lithium is surging, some analysts are optimistic. Yang Hongxin, chairman and CEO of Honeycomb Energy, believes that the rising price of raw materials for power batteries will not last forever. "at present, at least the price of nickel has fallen to a certain extent, and the price of lithium is still rising, but it should not continue to rise, and we expect the price of raw materials for batteries to stabilize by the end of this year."

It seems that the future price of lithium materials needs to be further observed.