Power battery upstream: out of stock, out of stock, out of stock

Starting from Q4 of 2020, as the market for new energy vehicles continues to rebound, orders for power battery companies have skyrocketed. Under a series of chain reactions, at the beginning of the new year, full production scheduling, out-of-stock price increases, and speeding up production expansion have become the key words for the development of lithium battery upstream materials. Recently, Gaogong Lithium also learned from the material supplier of the head battery company that due to the full order, overtime production has become the norm, and it is preparing for the New Year. At the same time, the expansion of production in line with the pace of customers has also been stepped up on the agenda. Judging from the feedback from material companies in many subdivisions, the pressure on production and delivery can be seen: “The production line is operating at full capacity, and now prices are changing day by day, and the first-line manufacturers will directly stop quotations.” A phosphoric acid company The senior executives of iron-lithium materials companies revealed. 'The orders are now very saturated, and the full production schedule has covered the entire first quarter. There is no rest for the New Year's overtime.' Feedback from insiders of the diaphragm coating material company. 'It's not that we don't want to supply, and the upstream is seriously out of stock. We can't do it.' A first-line electrolyte manufacturer said helplessly. 'The production capacity can't be supplied. Now customers are chasing in the factory every day, and they feel that they are about to be 'kidnapped' by customers.' A battery structural parts factory said bluntly. ...In fact, the delivery pressure of upstream lithium battery materials highlights that there is already a trace. Take the battery leader Ningde era as an example. Since the fourth quarter of 2020, after the Ningde era launched the Model 3 lithium iron phosphate battery, its shipments have surged by about 26,000 sets. Based on a bicycle of 55KWh, the total power exceeds 1.4GWh. Subsequently, there were media reports that Tesla hopes that CATL will meet its power battery supply for 300,000 electric vehicles in 2021, while CATL can only promise 200,000 matching supplies in order to meet the supply needs of other customers. Even so, 200,000 vehicles also means that the supporting power reaches 11GWh. In the recruitment notice issued in January, CATL even revealed the message of 'year-end orders skyrocketing'. According to industry news, CATL’s battery shipments in 2021 will triple that of 2020. Recently, the chairman of CATL, Zeng Yuqun, publicly pointed out that starting from 2021, the global lithium battery market demand will increase significantly, but at present, the capacity supply of the entire industry chain is relatively slow and effective supply is insufficient. In addition, power battery companies including AVIC Lithium Battery, BYD, Ruipu Energy, and Penghui Energy have all released information that power batteries are at full production and production capacity is in short supply. As an upstream material supplier for a head power battery company, the delivery pressure can be imagined. Judging from feedback from companies in upstream materials including cathodes, anodes, electrolytes, and separators, the production schedule in January of this year has increased by at least one time from last year. Depending on the situation of different companies in different fields, there may even be a three-fold increase over the same period last year. The shortage of goods triggers a wave of price increases. The industry predicts that domestic new energy vehicle sales will reach 2 million units in 2021, a growth rate of 50%; the domestic power battery installed capacity will reach 100GWh, a growth rate of 55%. According to this forecast, the shortage of upstream raw materials for power batteries will intensify. In fact, due to the strong downstream demand, some raw materials are out of stock and a chain reaction of price increases has followed. Due to the tight global price of lithium concentrate, since October last year, the price of domestic battery-grade lithium carbonate has begun to adjust. By the end of December, the average price rose to 51,500 yuan/ton, an increase of about 30%. Entering 2021, the price of battery-grade lithium carbonate continued to rise. In mid-January, the mainstream domestic price of battery-grade lithium carbonate reached 62,000-67,000 yuan/ton, an increase of about 25% from the end of the year. Recently, a domestic trader even quoted a high price of 80,000 yuan/ton for battery-grade lithium carbonate, which was 18,000 yuan/ton higher than the mainstream price. The above-mentioned lithium iron phosphate material company executives said that the price of lithium carbonate is only a case in the short term, and the willingness of large battery manufacturers to accept the increase of iron-lithium materials is low, and the price of iron-lithium materials is still relatively stable. But it does not deny that this is a signal of a long-term price increase. Taking into account the trend of lithium concentrate gap and the surge in global demand for new energy vehicles, it is temporarily impossible to predict how high the price of lithium carbonate will rise in 2021. Similarly, electrolytes have even begun to suffer from an embarrassing situation of supply disruption due to the supply of upstream raw materials. Among them, the prices of raw materials including lithium hexafluorophosphate, lithium carbonate, solvents (DMC, EC, etc.), additives (VC, FEC, etc.) have shown varying degrees. rise. Recently, the domestic price of lithium hexafluorophosphate is about 115,000-130,000 yuan/ton, which is nearly 86% higher than the low of 70,000 yuan/ton in July last year. The industry's judgment is that if the lithium hexafluorophosphate company is overhauled after the Spring Festival, the price will exceed 150,000 yuan/ton half a year in advance. In terms of solvents, although the price of DMC has fallen from 16,000-17,000/ton in Q4 last year to around 11,000/ton, it is still at a historical high and is in a tight supply. Recently, the price of additives such as VC and FEC has increased by 30%. First-line electrolyte manufacturers said that the current electrolyte manufacturers are not considering the issue of price, but the issue of unavailability of raw materials. In the case of large factories, the form of small factories is even more severe. In terms of prices, the current prices of raw materials such as lithium hexafluorophosphate, solvents, and additives are a reasonable correction. This is the basis for the healthy development of the industry, and it is not expected that there will be much increase in the future. Based on the company's solid strategic cooperation with suppliers and downstream, the current material price increase has limited impact on the first-tier manufacturers. Based on the industry's high expectations for new energy vehicles in 2021, the price increase trend of some raw materials may become the norm throughout the year.