SHANGHAI, Nov 11 - According to the China Association of Automobile Manufacturers, in October, China's power batteries’ installed capacity stood at 15.4GWh, up 162.8% year-on-year and down 1.8% sequentially. Among them, a total of 7GWh of ternary cathode batteries were installed, up 104.3% year-on-year and 13.5% month-on-month; a total of 8.4GWh of lithium iron phosphate (LFP) batteries were installed, up 249.5% year-on-year and down 11.6% month-on-month.
Based on the latest data, in October, the installed capacity of ternary cathode batteries rose by 13.5% MoM, achieving double-digit MoM growth for two consecutive months; while the installed capacity of LFP batteries still dominated the market, but declined MoM for the first time in half of year.
From the perspective of MoM growth of installed capacity, ternary cathode triumphed LFP, mainly triggered by accelerated penetration of high nickel power battery.
Unlike the Chinese market where LFP and medium nickel ternary cathode batteries dominate, the overseas power battery market mainly concentrated focuses on medium nickel (6 series) and high nickel battery. Since then, the increase in the proportion of high-nickel batteries in overseas electric vehicles market and the growth in sales of high-nickel battery models have been the main factors driving the significant growth in shipments of domestic ternary cathode materials.
In the third quarter, the sales of NCM811, Ni90 and ultra-high nickel products of Ronbay Technology increased by about 20% QoQ. In addition, shipments of high nickel cathode materails from foreign brands including POSCO Chemicals, L&F, Sumitomo Metals and Umicore also increased significantly year-on-year, mainly supplying the international market.
IFC Securities recently published an article, pointing out from three aspects that, in the long term, high nickel ternary battery is still the mainstream in the future.
(1) Performance: LFP’s energy density has been close to the theoretical ceiling, hence the future improvement is limited; while the ternary material’s energy density still has some way to go before reaching the theoretical value, which is likely to further improve with the rise of nickel content. At the same time, through material modification, battery structure optimisation, system protection and other strategies, the safety of high nickel ternary batteries is expected to be greatly improved.
(2) Cost: Thanks to the low content of precious metal cobalt, evolving technologies, constant scaling, and the development of recycling industry, the costs of high nickel ternary battery are likely to fall much faster than that of LFP battery.
(3) Application scenarios: Although the proportion of LFP battery in the entry version is gradually increasing, the high performance version still requires high nickel ternary materials.
