Supply shortage, strong market demand, cathode material manufacturers are busy preparing goods.

SMM survey: what kind of metal do you like most in 2022?

"there is very little supply on the market at present." Wang Hong, sales director of Nantong Yuehua New material Technology Co., Ltd., told China Securities News that towards the end of the year, manufacturers of cathode materials were in a strong purchasing mood, but the supply of lithium salt was tight, pushing prices higher and higher.

According to agency data, the highest quoted price for battery-grade lithium carbonate is 256000 yuan per ton. it is expected that next year's increment will mainly come from salt lake lithium extraction, and the supply may fall short of expectations, while the demand increment will be determined.

Looking for "salt" through multiple channels

"it is estimated that supply will fall short of demand in the first half of next year, and many enterprises are worried that they will not be able to buy goods." Wang Hong said.

The rise in lithium prices has accelerated since December, driven by strong demand. According to SMM, the price of battery-grade lithium carbonate rose 4000 yuan / ton on December 23, with an average price of 254000 yuan / ton, with the highest quotation reaching 256000 yuan / ton, breaking the forecast price of 250000 yuan / ton in the early stage of the market. The price of industrial grade lithium carbonate rose to 236000 yuan / ton.

The cost of lithium salt is also moving up. Yongxing material said in the research summary that the cost of lithium salt has increased, but the raw materials come from its own mines, which is still within a reasonable range.

Minsheng Securities pointed out that the current battery-grade lithium carbonate long single quotation of 220000 yuan / ton, short single quotation of 260000 yuan / ton. Huaan Securities believes that towards the end of the year, positive material manufacturers have a strong mood to prepare goods, and the tight supply situation does not change. At the same time, the supply of lithium salt in Qinghai Salt Lake is limited due to the influence of climate, and the supply of lithium salt continues to be tight.

At present, the main lithium salt manufacturers are mainly to maintain old customers, and there are no bulk orders for sale for the time being. Some traders have a small amount of spot in their hands, but they are mainly used to protect old customers. On the whole, the market demand is strong, the spot circulation is less, the inventory is consumed, and the price of imported lithium carbonate increases obviously.

Some cathode material manufacturers can not buy goods, so they have no choice but to purchase industrial-grade lithium carbonate. "unable to find the source of goods, so open up channels to buy low-content industrial-grade lithium carbonate, process and purify it into lithium carbonate suitable for batteries, with a purification cost of more than 10000 yuan / ton." Wang Hong told reporters.

Lithium mining companies have expanded production

The new energy track continues to be hot, and lithium mining companies have expanded production one after another.

Recently, a number of lithium mining giants announced plans to expand production. Ganfeng Lithium announced on the evening of December 1st that Ganfeng International, a wholly-owned subsidiary, had completed the first phase of the equity transaction with a consideration of US $39 million and would hold a 50 per cent stake in SPV of the Netherlands upon completion of the transaction. After the establishment of SPV of the Netherlands, the mining license of Goulamina spodumene will be transferred to SPV of the Netherlands, which is expected to be completed in early 2022.

Tianqi Lithium Industry said on the interactive platform a few days ago that in June 2021, the Wenfield board of directors decided to advance the trial operation of Terrison's third phase of 600000 tons of chemical-grade lithium concentrate expansion project to the end of 2024. At that time, the Terlison lithium concentrate will be able to reach 1.94 million tons per year.

The hot market attracts more and more enterprises to join the game. Since the second half of the year, chemical enterprises such as Xingfa Group and Hubei Yihua have "crossed the border" to enter the lithium iron phosphate track.

A person in charge of Mount Qomolangma in Tibet said in an interview with the China Securities News: "according to publicly disclosed information, it is estimated that by the end of 2022, the production capacity of iron phosphate with a clear timetable will reach 585000 tons, while the planned capacity will exceed 3 million tons."

The person in charge said that the main increase in lithium salt in 2022 will come from the extraction of lithium from salt lakes. Even under optimistic circumstances, the supply and demand of lithium salt will maintain a tight balance in 2022, and the gap may be slightly larger than that in 2021.

According to Pacific Securities, the global supply of lithium resources will increase by about 180000 tons in 2022. However, due to the project progress is not as expected and other reasons, the actual release may be lower than expected. Everbright Securities believes that from the supply side, the output of new lithium resources in 2022 is less, and the gap between global supply and demand of lithium resources is about 34000 tons of LCE. With the commissioning of new ore and salt lake projects in 2023, the gap between supply and demand will narrow.

The shortage of supply is difficult to ease in the short term.

In terms of demand, the development of new energy vehicle industry is accelerated, and the demand for lithium resources is improving in 2022.

The China Association of Automobile Manufacturers predicts that sales of new energy vehicles in China will be 5 million in 2022, an increase of 47 per cent over the same period last year. According to the Development Plan of New Energy vehicle Industry (2021-2035), the sales of new energy vehicles will reach about 20% of the total new car sales by 2025.

The person in charge of Mount Qomolangma in Tibet told the China Securities News that the demand for lithium batteries is expected to grow rapidly from 2021 to 2025. The demand for lithium batteries will reach 1,223 GWH in 2025, with an average annual compound growth rate of 34.4 percent, and the demand for lithium resources will continue to increase. From the supply side, the supply of lithium resources from 2020 to 2023 will grow at an average annual compound growth rate of 29.6%, and the supply of lithium resources will be insufficient in the next three years. "the self-sufficiency rate of lithium resources will determine the core performance and future growth of enterprises." The person in charge said.

According to the Citic Securities Research report, as the global lithium price continues to rise, the development of lithium resources in salt lakes in South America is becoming more and more popular. In 2021, the development of lithium resources in South America represented by the Argentine Salt Lake Project accelerated, and domestic enterprises such as Ganfeng Lithium Industry, Mount Qomolangma in Tibet, Shengxin Lithium Energy, Zijin Mining and Ningde era accelerated the distribution of lithium resources in South American Salt Lake.