MIIT's New Policy Implementation Reshapes Second-Life Application Industry Chain, Market Consolidates on a Subdued Note [SMM Weekly Review]

Published: Aug 6, 2026 17:50

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Second-life battery cell market remained steady overall this week. Upstream raw material cost support weakened. Lithium carbonate briefly rebounded during the week before its overall center shifted lower. Nickel sulphate futures ran steady, while cobalt sulphate continued its sustained downward trend. The raw material side failed to provide effective support for second-life battery cell prices. The supply side was notably impacted by the MIIT Announcement No. 20 on July 30. The document abolished the previous clauses related to power battery second-life applications, removed over a hundred listed second-life enterprises from the compliance catalog, and explicitly prohibited the use of retired power batteries in two-wheeler EV applications. Driven by the policy, dismantled second-life battery cells accelerated their flow into recycling and smelting channels. Quotations for dismantled supply fell under pressure, with some specifications' prices gradually converging toward scrap recycling prices, signifying a structural reshaping of the pricing logic for second-life battery cells. On the demand side, using second-life batteries in the small power sector was already a violation. The new policy means this gray market has been completely eliminated at the regulatory level. The energy storage scenario has become the core demand support for second-life battery cells. Energy storage demand remained stable, but downstream acceptance of high prices was limited, with procurement primarily driven by rigid demand and insufficient momentum for price increases. In the short term, the market is expected to maintain stable operation.

SMM July 30 News:

Second-life Recycling This Week:

This week, the overall second-life battery cell market moved sideways and remained stable. Upstream raw material cost support weakened, with lithium carbonate prices briefly rebounding during the week before the overall center shifted lower. Nickel sulphate futures traded steadily, while cobalt sulphate continued its unilateral downward trend, making it difficult for the raw material side to provide effective bottom support for second-life battery cell prices. The supply side was significantly impacted by the MIIT Announcement No. 20 on July 30. The document abolished the original provisions related to the second-life application of power batteries, removed over a hundred publicly listed second-life enterprises from the compliance list, and explicitly prohibited used power batteries from entering the two-wheeled EV application scenario. Driven by the policy, dismantled second-life battery cells accelerated their flow into recycling and smelting channels. Quotations for dismantled supply came under pressure and pulled back, with prices for some specifications gradually approaching scrap recycling prices, leading to a structural reshaping of the pricing logic for second-life battery cells. Demand side, the use of second-life batteries in the small power sector was already a violation, and the introduction of the new policy meant that this grey market was completely terminated at the institutional level. The energy storage scenario became the core demand support for current second-life battery cells. Energy storage demand remained stable, but downstream acceptance of high prices was limited, and procurement was mainly need-based, resulting in insufficient upward momentum. The market was expected to remain stable in the short term.

SMM New Energy Research Team

Wang Cong 021-51666838

Ma Rui 021-51595780

Feng Disheng 021-51666714

Lv Yanlin 021-20707875

Lei Yue 021-20707873

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