Sodium-ion Battery Competitive Landscape: Cathode Shortage Persists, Hard Carbon Anode Margins under Pressure

Entering August, the sodium-ion battery industry chain continued to gain momentum, with cathode and anode materials showing a "fire and ice" dynamic: the cathode materials segment faced tight supply-demand conditions and elevated costs, with orders being deferred, while the hard carbon anode segment remained mired in profitability pressure. The structural contradiction of rising volumes but thinning margins across the industry chain has become the most striking hallmark of the current sodium-ion battery materials market.

I. Cathode Materials: Supply Gap Widens, "Production-Determined Sales" Becomes Prominent

According to an SMM survey, sodium-ion battery cathode material production increased 4% MoM and surged 71% YoY in August, with polyanion-route materials accounting for as much as 87%, further consolidating their dominant position.

From a supply-demand pattern perspective, the sodium-ion battery cathode materials market continued to exhibit tight supply-demand conditions. Downstream battery cell manufacturers held ample orders, and while leading NFPP enterprises saw monthly orders exceed the thousand-ton level, delivery capacity constraints meant orders could not be fulfilled on time and had to be deferred to the following month. Combined with carryover delivery pressure from the prior period, actual deliverable volume in August fell short of 90% of demand, highlighting a widening supply gap and reinforcing the industry's "production-determined sales" characteristics.

From an enterprise operations perspective, mainstream NFPP enterprises largely entered full-capacity mode in August, with capacity allocation clearly tilted toward core major clients. To ensure uninterrupted supply to leading two-wheeler power and energy storage battery cell manufacturers, some clients' intended demand of several hundred tons could only be fulfilled at roughly 60%, while production scheduling cycles for new and small-to-medium clients were notably extended.

To alleviate the tight supply situation, mainstream enterprises accelerated construction of new self-owned production bases on one hand, while actively introducing toll processing capacity on the other, which requires only equipment retrofitting to commence production. However, given that new production lines still need to undergo trial production ramp-up, rapid batch shipments are unlikely in the short term. SMM expects the tight supply situation to persist into early Q4.

On the pricing front, NFPP quotes remained broadly stable in August with no notable increases. Meanwhile, on the cost side, iron phosphate prices climbed above 15,000 yuan/mt with suitable supply also tight, leaving NFPP enterprises still under profit pressure. The cost pass-through mechanism still requires time to normalize. Looking ahead, industry prosperity is expected to remain positive in September, with leading NFPP enterprises seeing full order books. SMM expects sodium-ion battery cathode production to increase 5% MoM and 160% YoY in September. Enterprises with advantages in capacity, cost, and client structure will be the first to benefit, and the industry's confidence in the medium and long-term development of sodium-ion batteries remains unchanged.

II. Hard Carbon Anode: Shipments Climb Steadily, Industry Profits Remain Under Pressure

In August, sodium-ion battery hard carbon anode production rose 4% MoM and surged 128% YoY, sustaining a high-growth trajectory.

From the perspective of the competitive landscape, top-tier producers have reached monthly shipments of several hundred mt, while second-tier producers maintain monthly shipments at the 100 mt level. Subsequent tiers ship only tens of mt with limited scale, and the divergence between leading and mid-to-tail enterprises continues to widen. On the demand side, growth is driven primarily by existing clients, as scattered small-batch orders are not enough to justify standalone production schedules due to capacity constraints. In terms of demand structure, the current hard carbon volume is concentrated in small power (two-wheeler) and energy storage long-cycle products.

From an operational standpoint, mainstream producers are running production lines at essentially full capacity. Overall industry capacity remains adequate for now, but as downstream demand gradually releases, hard carbon will still face undersupply pressure. Production schedule strategies have diverged: some producers prioritize stockpiling their own products and use spare capacity for toll processing orders; others are proactively scaling back toll processing due to unstable external processing quality and higher overall costs, turning down low-price orders.

Worth noting is the price and profitability situation. Current hard carbon selling prices are fiercely competitive, with the industry in a "lose money on every mt sold" state, driven primarily by downstream key clients pushing for lower prices. Although prices show a downward trend, monthly declines are only a few hundred yuan, still a significant gap from the reductions clients expect. Prices exhibit notable scenario-based stratification: two-wheeler small power products are priced lower and serve as the volume driver, while high C-rate and excellent low-temperature performance products sit at the price ceiling level.

From the competitive landscape perspective, top-tier producers have built barriers through scale and client stickiness; second-tier producers with monthly shipments at the 100 mt level maintain their base primarily through fixed cooperative clients and toll processing share.

Looking ahead, as downstream capacity comes online from late Q3 to early Q4, and year-end process validation and cost reduction are realized, hard carbon shipments are expected to climb month by month. However, the arrival of an industry profit inflection point still depends on the pace of end-user volume release, battery cell yield improvement, and price negotiations with key clients. SMM expects September hard carbon anode production to rise 4% MoM and 128% YoY.

 III. Summary

Overall, the sodium-ion battery materials market in August exhibited a divergent pattern of "undersupply in cathodes, rising volume with falling prices in anodes." The supply gap in the cathode segment is unlikely to close in the short term, with top-tier players running at full capacity and selling out, orders spilling over, and parallel expansion and toll processing becoming the key to breaking the deadlock. Hard carbon anodes, by contrast, are facing profitability pressure amid rapid volume growth, where cost control and product differentiation serve as the primary levers for navigating the cycle. Looking ahead, as demand from two-wheelers and energy storage continues to release, and as old and new capacity comes online successively in Q4, the sodium-ion battery materials segment is expected to enter a window of rising volume and profit, though the pace of profit realization still requires close tracking of marginal changes in end-user volume growth and industry chain price competition.