Shrinking Demand from Power Battery Sector Sends Battery Cell Output into a Nosedive in Jan

SHANGHAI, Feb 16 (SMM) - The ternary battery output was 11.7 Gwh in January, down 37% month-on-month and 22% year-on-year. LFP battery output reached 27.9 Gwh, down 29% month-on-month and up 20% year-on-year. The battery cell market remained slack in the month. The output dropped MoM for three consecutive months and set a new low since April 2022. On the supply side, the new orders received by battery cell companies have gradually decreased since January. Some battery cell makers, even the large ones, suspended their production for the CNY holiday. As a result, the overall production and sales of batteries crashed.

On the demand side, the growth rate of NEV sales slowed down. Car makers and dealers who restocked a large number of battery cells amid the booming terminal demand in the fourth quarter of 2022 became less willing to purchase and mainly focused on consuming the in-plant battery cells. However, demand from the energy storage market was relatively firm as the industry is subject to the mandatory allocation and storage of domestic PV and wind power and the adjustment of electricity prices. From the perspective of market demand in the near future, it is expected that the production and sales of battery cells will remain low.