Recently, the research institutions EVTank and Yiwei Economic Research Institute, in collaboration with the China Battery Industry Research Institute, jointly released the "White Paper on the Development of the Lithium Hexafluorophosphate (LiPF₆) Industry in China (2025)." According to EVTank data, as of the end of 2024, the global effective production capacity of lithium hexafluorophosphate is 390,000 mt, with China's effective production capacity reaching 371,000 mt per year.
Data from EVTank's previously released "White Paper on the Development of the Lithium Hexafluorophosphate (LiPF₆) Industry in China (2024)" shows that as of the end of 2023, the industry's effective production capacity was 300,000 mt per year, while the nominal capacity under construction and planning was expected to exceed 1 million mt by 2025. However, with the significant decline in lithium hexafluorophosphate prices since 2024, market competition has become exceptionally fierce, and corporate profitability has sharply decreased. A large number of previously planned lithium hexafluorophosphate projects have been canceled, projects under construction have been delayed, and the actual production capacity realized is far below the planned levels.
Furthermore, EVTank stated in the white paper that in 2024, most small and medium-sized enterprises in the industry were unable to withstand cash flow losses and remained in a prolonged shutdown state, resulting in China's lithium hexafluorophosphate capacity growth rate being far below expectations.
Demand side, EVTank noted that although new-type lithium chemicals such as lithium bis(fluorosulfonyl)imide (LiFSI) are also undergoing continuous R&D advancements, their maturity in processes, technical challenges, and production costs are not yet comparable to lithium hexafluorophosphate. Currently, lithium hexafluorophosphate remains irreplaceable. Therefore, with the growth in downstream electrolyte shipments, the shipments of lithium hexafluorophosphate are expected to increase significantly.
In the medium and long-term, lithium hexafluorophosphate will remain the primary lithium chemical used in electrolytes. Based on the forecast of downstream electrolyte demand, EVTank expects global electrolyte shipments to drive lithium hexafluorophosphate demand to reach 249,000 mt in 2025 and 545,000 mt in 2030.
From the perspective of the supply-demand relationship, the surplus in lithium hexafluorophosphate capacity may be cleared by 2026. However, considering the shutdown of capacities from some second- and third-tier enterprises due to prolonged losses and the elimination of outdated capacities, EVTank indicated that the supply-demand relationship for lithium hexafluorophosphate might tighten earlier. On the other hand, the monopolistic position of the three leading enterprises—Tinci Materials, DFD, and TONZE—combined with the industry's overall losses, provides both the motivation and external environment for lithium hexafluorophosphate price increases. It is expected that the market price of lithium hexafluorophosphate will enter an upward cycle in 2025, though the increase will be limited. Leading enterprises are likely to maintain marginal profits, while second- and third-tier enterprises will continue to incur losses.
Looking ahead, considering factors such as raw material prices, processing fees, the supply-demand relationship, and competitive dynamics, along with the forecasted industrialisation progress of solid-state batteries and other new-type lithium chemicals, the price of lithium hexafluorophosphate is expected to remain relatively stable with a slight upward trend. Leading enterprises are anticipated to reduce processing costs through process improvements and lower unit consumption, as well as reduce raw material costs through vertical integration of the industry chain, thereby achieving relatively normal profits.
