SMM analysis | In the first quarter, the shipment of energy storage cells exceeded 30GWh, and the market continues to recover.

In the first quarter, the shipment of energy storage batteries exceeded 30 GWh, and the market is continuing to recover, according to SMM analysis. According to the data tracked by SMM, the shipment of energy storage batteries in China in the first quarter of 2024 exceeded 33 GWh, a decrease of 27% compared to the fourth quarter of 2023. Breaking down the market performance, the front-end energy storage market shipped approximately 28 GWh, while the back-end energy storage market (including household, industrial and commercial, backup power, etc.) shipped approximately 5 GWh. In the first quarter of 2024, the proportion of shipments of energy storage batteries in China was 82%, with overseas shipments accounting for only 18%. In the first quarter, the overall demand in the overseas energy storage market was weak. In the fourth quarter of 2023, the energy storage battery industry was still in the process of reducing production and clearing inventory. Although domestic integrators delivered systems in December to meet centralized delivery deadlines, the high inventory of energy storage batteries in the market led to continued pressure on enterprise inventory. At the same time, Europe continued to clear inventory, installation in the United States was delayed, and other emerging markets struggled to contribute effectively to the market, leading to overall low demand for energy storage overseas. In the first quarter of 2024, the energy storage market entered the traditional off-peak demand season. Breaking it down: In January 2024, the rush to grid connection at the end of 2023 came to an end, and the market quickly cooled off. However, the market turmoil caused by the crisis of oversupply in the market led to a part of the back-end demand for energy storage, with back-end energy accounting for 16% of shipments in January, but the overall energy storage battery shipments in China in January decreased by about 24% compared to the previous month. In February 2024, the market demand reached its lowest level of the year due to the Chinese New Year holiday, with energy storage battery shipments in China down by about 30% compared to January. In March 2024, the oversupply of batteries continued, and the iteration of 300+ Ah batteries in the market accelerated in 2024, potentially impacting the market for 280 Ah batteries. Intensified competition among enterprises and the demand to clear inventory led to a significant decrease in market prices. As the demand side recovered from the Chinese New Year holiday and prepared for grid connection, the shipment of energy storage batteries in China increased significantly by about 102% in March compared to the previous month. Looking ahead, SMM Energy Storage predicts that as downstream demand gradually recovers and grid connection preparations increase, the shipment of energy storage batteries may continue to grow rapidly in the second quarter. However, in terms of the demand structure of the segmented market, the front-end energy storage market remains the main source of demand, while SMM Energy Storage believes that demand in the back-end energy storage market may steadily recover in the second quarter after the completion of overseas inventory clearance.