SHANGHAI, Jul 28 (SMM) - China produced a total of 285,000 mt of ternary cathode materials, up 45% from the first half of last year and 17% from the second half of last year.
Looking back to the first half of 2022, the demand for ternary cathode materials was poor in January as battery cell manufacturers had completed their restocking at the end of the previous year, and they just took a break from the year-end rush. The production of ternary cathode material factories dropped slightly. In February, due to the combined influence of several factors including the Chinese New Year holiday, rising prices of lithium raw materials as well as insufficient supply, the operating rates of small and medium-sized material factories decreased, resulting in a lower output than in January.
In March, terminal sales of automobiles were plagued by great uncertainties as new energy vehicle (NEV) prices were frequently adjusted. In addition, the lasting pandemic from March to May severely affected the supply chain and production of car makers, especially the COVID lockdown in Shanghai. In the overseas market, due to the Russia-Ukraine war, energy prices surged, dampening overseas demand, and the European car sales market was also unclear. Therefore, the production of material factories was also hindered by the poor terminal demand. On the other hand, after nickel prices skyrocketed in March, battery cell factories mainly replied on their in-plant material stocks as they had stockpiled earlier. These two reasons have led to a decline in the demand for ternary cathode materials, and the material production in April and May was lower than that in March.
In June, car makers gradually resumed work and production after the pandemic situation improved, generating more demand for batteries. In addition, the cell factories generally carried lower in-plant stocks, hence the demand to source ternary cathode materials was high. As such, ternary cathode material production recorded its highest single-month reading in June throughout the first half of 2022, with a monthly output of 67,000 mt.
Compared with the first half of 2021, the production of medium and low nickel as well as high nickel materials both increased, especially high nickel, alluding more extensive application of high nickel materials.
In terms of product portfolio, the proportion of 6-series NMC materials stood at 20% of the total production, and 5-series and 8-series took up 40% each. The specific proportion is in dynamic changes each month. Nonetheless, the downstream will re-consider the application of ternary cathode materials out of cost advantage as nickel and cobalt prices have been falling recently.
In terms of the competition landscape, the competition among ternary cathode material enterprises in the first half o f2022 is still intensive, with a narrow gap between top-tier material enterprises. Among them, Ronbay Technology leads the competition with a slight advantage. The commissioning of new capacities in the first half of 2022 was limited. Several top-tier companies will release new capacity in a concentrated manner in the second half of 2022, whose production scale may improve further.