China Lithium Battery
- Raw Materials
About this article
This is written by a battery expert who has been in the industry for more than 10 years. It comprehensively introduces the general situation of China’s lithium battery industry from a simple perspective.
Some information, especially the source of data, is confidential. If you need data sources, please contact us.
Lithium Battery Industry Chain
Brief introduction of lithium battery
In the industrial chain,
# The upstream of lithium batteries: raw materials represented by lithium, graphite and rare metal ores.
# The midstream is the battery link, divided into battery raw materials, and battery manufacturers.
# The downstream has three major application scenarios, namely new Energy vehicles, daily consumption, and energy storage.
Before understanding this industry, we must first know what it is for? What is the working principle of lithium battery?
Here, we get this picture. From this picture, we can clearly see that lithium batteries are mainly charged and discharged through the directional movement of lithium ions between the positive and negative electrodes.
This picture not only shows the working principle of lithium battery, but also contains its four major raw materials, namely positive electrode, negative electrode, electrolyte and separator.
Specifically about the proportion of these four raw materials to the total cost, we can see the figure below.
This picture shows the cost structure of the whole industry. From the perspective of power batteries, there are currently two technical routes:
–lithium iron phosphate battery
Therefore, when it comes to a certain subdivision route, the relevant cost composition may be different from this picture.
Lithium battery industry
After a brief introduction to lithium batteries, the following part officially enters the industry.
Overseas institutions have calculated the market size of the global lithium industry.
In 2020, the market size of the global lithium industry is around 335,000 tons. And the battery technology will become increasingly mature in the future.
According to their calculations, by 2028, the demand of the global lithium industry will reach 2.013 million tons, with a compound annual growth rate of 35%. The power battery can be said to be able to support such a high growth rate.
In 2020, the demand for power batteries accounts for 34% of the overall lithium industry demand. And by 2025, this proportion will become 69%. The demand of the industry is growing at a high speed, coupled with the increase in weight. The future space of the battery industry can be described as huge.
Since the industry’s prosperity is so high, capital expenditure will naturally not be low.
In the first half of 2021, battery manufacturers such as CATL, BYD, and EVE Energy have successively announced more than 30 investment plans, with a planned battery production capacity of more than 78.2 billion watt-hours.
The substantial expansion of battery manufacturers means that more upstream raw materials are needed. So we choose to look at the raw material links upstream of lithium batteries at this node.
Lithium battery material
Let’s take a look at the link between lithium battery and its materials.
As mentioned above, there are four main raw materials for lithium batteries. Therefore, these four materials each have their own characteristics and need to be discussed separately. Let’s look at the conclusion first:
battery
material
→
Positive electrode — linked to downstream technology
Negative electrode — the technical bottleneck
Electrolyte — Cycle is King
Diaphragm — Difficult to expand
First of all, the first material is the Positive electrode.
It is the core of lithium batteries. How can we know? Naming rights can explain everything. The well-known ternary batteries and lithium iron phosphate batteries are actually positive electrode materials.
Speaking of these two technologies, at present, these two technologies are very suitable for power batteries. Power batteries are the largest application scenario for lithium batteries, so the shipments of these two cathode materials are far ahead.
Just because the cathode material involves the technical route of the battery, in addition to focusing on the performance of the battery, we also need to look at the downstream application scenarios.
For example, the energy storage that has emerged in recent years is more suitable for lithium iron phosphate. Because it does not have too many requirements on parameters such as volume and energy density. This also makes lithium iron phosphate, which has been increasingly endangered, rise again.
In the table below, we briefly compare the performance differences of the four cathode materials for your reference. We will share more details with you in the second part on cathode.
Materials | Lithium Cobalt Oxide | Lithium manganese oxide | Lithium iron phosphate | Ternary material |
Abbreviation | LCO | LMO | LFP | NCM |
Energy Density | Middle | Low | Middle | High |
Cyclic/time | 500-1000 | 500-2000 | 2000-6000 | 800-2000 |
Safety | Poor | Average | Good | Average |
Operating Temperature | -20~55℃ | ＞50℃ rapid decline | -20~ 75℃ | -20~55℃ |
Cost | Very high | Low | Low | High |
After talking about the positive pole, let’s look at the negative electrode. The main function of the negative electrode material is to store and release energy.
The classification of negative electrodes is often based on the active materials used, so negative electrode materials can be divided into two categories:
# carbon materials
# non-carbon materials.
For a more subdivided division, you can see the table below.
Lithium battery anode material
↗
↘
(1) Carbon materials
(2) Non-carbon materials
↗
↘
↗
→
↘
① Graphite material: natural graphite, artificial graphite, mesocarbon microspheres
② Other carbon-based materials: hard carbon, soft carbon, graphene
① Titanium-based material: lithium titanate
② Silicon-based materials: silicon-carbon anode materials
③ Other non-carbon materials: tin-based materials, nitrides, lithium metal
The final product of the negative electrode material is very single, that is, artificial graphite.
Although artificial graphite has higher safety and lower cost than other materials, its energy density is also relatively general. The theoretical upper limit is 372 mAh per gram. However, at present, the leading companies in the industry have achieved 365 mAh per gram, infinitely approaching the ceiling.
Therefore, the industry urgently needs to break through technologically and gain new room for growth.
In addition to continued breakthroughs in technology, the biggest problem in the anode industry in 2021 is the lack of graphitization capabilities. We will share specific aspects with you in the third part.
After discussing the positive and negative poles, let’s look at the electrolyte.
The most important function of the electrolyte is to act as a carrier for ion migration, which can ensure the transmission of lithium ions between the positive and negative electrodes.
Therefore, the electrolyte is generally composed of high-purity organic solvents, electrolyte lithium salts and additives, which are prepared in a certain proportion.
If divided according to the cost, the proportion of lithium salt is about 40%~50%, the proportion of solvent is about 30%, and the proportion of additive is 10%~30%.
So, learning about the electrolyte, we have to view it as three subdivided tracks. The industry pays more attention to 6F, which is a kind of electrolyte.
In 2021, as the industry booms, the price also rises rapidly. The next generation is expected to replace 6F is difluorine will also be put into production at the beginning of next year.
Although the cost is relatively high at present, due to the high price of GF, the replacement of new lithium salt may be faster than expected.
After knowing the first three materials, let’s finally look at the diaphragm. The main function of the separator is to separate the positive and negative electrodes to prevent short circuits.
The manufacturing process of the diaphragm is divided into dry method and wet method.
In short, the dry method has low cost and simple process, but its performance is not as good as that of the warm method.
From the perspective of the industry structure, the separator may be the most certain among the four major materials. Because the expansion of diaphragm production is more dependent on equipment manufacturers. While the production capacity in the next few years has been locked by leading companies, the industry concentration will continue to rise.
We can also know this by looking at the data of the past two years. It is precisely because the production capacity is locked by leading companies that the concentration of diaphragms is expected to further increase in the next two years.
Finally, let’s make a summary of this part. Due to the continuous expansion of downstream application scenarios, the lithium battery industry has also entered a golden decade, and its prosperity has continued to improve. With the rise of the boom, the capital expenditure of the industry has also increased significantly, which has caused the upstream raw materials to keep up with the expansion of battery production.
Among the four materials, the positive electrode is the most important and is often used in the naming of batteries. While the negative electrode is close to the ceiling due to the route of artificial graphite, and there may be changes in the technical route in the future.
The electrolyte increases rapidly in 2021, which also leads to the application of new lithium salts.
The diaphragm is the most certain part of the industry structure. Because most of the expansion capacity has been booked, and the continuous increase in concentration is also foreseeable.
At last, let us remind you that the industry space is indeed large, but the industry’s large-scale expansion of production is also in progress. Once the expansion is completed, the supply exceeds demand. It will be easy to logically evolve into a periodic bulk pricing logic. The company’s stock price will also have a certain impact.
Cathode Materials for Lithium Batteries
About cathode materials
In this part, we will analysis the first raw material of lithium battery, which is the positive cathode material.
At the beginning, let’s briefly introduce the cathode material.
In the first part, we mentioned that the positive electrode is the core of lithium batteries, which directly affects the energy density, voltage, service life and safety of lithium batteries, and is also the most expensive segment. Therefore, many lithium batteries are often named after positive electrode materials.
From the current point of view, there are four kinds of positive electrode materials, namely:
# Lithium cobalt oxide (LCO)
# Lithium manganese oxide (LMO)
# Lithium iron phosphate (LFP)
# Ternary material (NCM).
According to survey data, in the first five months of 2021, the output of the fourth largest cathode material in China reached 353,200 tons, a year-on-year increase of 143.7%. And the fastest growth was lithium iron phosphate and ternary materials, with a year-on-year increase of respectively 261.7% and 122.3%. Among the four major cathode materials, only lithium iron phosphate and ternary materials are widely used in power batteries. Therefore, the space is naturally larger than the other two, so it is also the focus of our research in this lesson.
Now, let’s look at lithium iron phosphate first. The advantage of lithium iron phosphate lies in its high safety. Besides, the raw materials are easy to obtain, and there is no risk of being stuck.
As for the safety, the cathode material will gradually decompose and release oxygen at high temperature, causing the electrolyte to burn.
Ternary materials will undergo the above reaction at about 150°C~250°C. While the decomposition temperature of lithium iron phosphate reaches 600°C, which is almost four times higher than that of ternary materials. Its safety advantage is quite obvious.
Easy availability of positive electrode raw materials
About the fact that raw materials are easier to obtain:
In fact, everyone can know from the name
# Lithium iron phosphate that it is mainly composed of four sources: phosphorus source, iron source, lithium source, and carbon source. These four materials are relatively common, so the price is relatively cheap.
# The ternary material (NCM) is composed of three materials: nickel, cobalt, and manganese. The price of cobalt is very expensive, which raises the price of ternary batteries. But cobalt also has its own role, which is to stabilize the chemical structure of the battery.
Therefore, for ternary materials, how to reduce the proportion of cobalt as much as possible and achieve cost reduction under a stable structure has become the key.
Since the proportion of cobalt is reduced, there must be an increase in the proportion of a material, that is nickel. So this battery is also called a high-nickel ternary battery.
The cobalt used for stabilization is reduced, and nickel is used to increase the energy density. Such a process makes the processing difficulty increase geometrically.
In order to distinguish high-nickel and ordinary ternary batteries, the industry divides them into four types: 111, 523, 622 and 811 according to the ratio of nickel, cobalt and manganese.
It is obvious that the 8 series has the highest nickel content.
In May 2021, the 5-series ternary materials are still the mainstream, but their proportion has been reduced to 47.5%.
On the contrary, the market share of 8-series ternary materials has increased significantly, reaching 36%.
From the rapid increase in the market share of 8-series materials, we can also see that the essence of high-end manufacturing is to reduce costs and increase efficiency. And in this regard, ternary has greater room for improvement than lithium iron phosphate.
The advancement of technology will also increase industry barriers and avoid vicious competition.
Positive electrode
↗
↘
(1) What is positive electrode
(2) Private enterprise or State-owned enterprise
↗
→
↘
↗
↘
① Four materials
② Lithium iron phosphate – safe and cheap
③ Ternary – high energy density
① EASPRING
② RONBAY
Two representative companies in the cathode field in China
After briefly introducing several cathode materials, let’s analyze the two representative companies in the cathode field, namely EASPRING with a background of a Chinese central enterprise and RONBAY with a background of a Chinese private enterprise.
Let’s start with EASPRING, which has the background of a central enterprise. The predecessor of EASPRING is the research group of Beijing Research Institute of Mining and Metallurgy.
The background of the academy determines EASPRING’s technological leadership.
And because it entered the overseas market earlier, it entered the Korean market in 2005 and the Japanese market in 2009, which led to a relatively high proportion of its overseas customers. Besides, overseas customers have always pursued a policy of high prices and high quality, so EASPRING’s profit margins have always been acceptable.
After talking about EASPRING, let’s take a look at RONBAY. RONBAY’s core team comes from EASPRING, which leads to a deep technical foundation for the company. And because it is a private enterprise background, the company is more radical in terms of expansion and technology.
First of all, let’s talk about the technology. As the first company in the world to develop a fully automatic production line of more than 8 series, RONBAY is in an absolute leading position in the field of high nickel.
This can be seen from RONBAY’s market share in the 8-series ternary market. In the first 10 months of 2020, it reached 46%. Not only is it radical in technology, but it focuses on breaking through the difficult 8-series high-nickel materials. RONBAY’s expansion plan is even more exaggerated.
At the end of 2020, RONBAY had only 40,000 tons of high-nickel ternary production capacity. But by the end of 2021, this figure had become 150,000 tons. In contrast, EASPRING’s expansion plan, especially in the high-nickel field appears to be more conservative.
The more aggressive the route, the greater the profit can naturally be made when the industry is booming. However, when the demand becomes increasingly saturated, coupled with the proliferation of technology, in the face of huge production capacity, products can easily become “commodities”.
Therefore, for cathode materials, or even all lithium battery raw materials, it may be a better perspective to focus on the medium term rather than the long term.
Finally, let’s make a summary of this part. Lithium iron phosphate has received a lot of attention recently because of its high safety factor and easy access to raw materials.
The ternary material has a high capacity density and needs to continuously optimize the high-nickel structure. Therefore, the technical barriers are stronger, and the profitability per ton is also stronger than that of lithium iron phosphate.
It is also because of the ternary materials that there is still room for optimization, there is more room for cost reduction. And that is more in line with the nature of high-end manufacturing, which is more likely to become the mainstream in the future.
As for the two representative companies in the industry, EASPRING has strong technology because of the background of central enterprises, and is backed by overseas customers. The unit price of customers is relatively high, but at the same time they are relatively conservative. The aggressiveness of RONBAY not only occupies the leading position in high nickel, but also leads the peers in expanding production.
Of course, there are far more than these two cathode material companies. We just choose representative ones to make a simple analogy.
Conclusion
● Lithium iron phosphate: safe and cheap
● Ternary: high energy density, strong technical barriers, and strong profitability
● Future trend: high nickel ternary battery
● EASPRING: Western style background, conservative
● RONBAY: Private enterprise background, radical
Anode Materials for Lithium Batteries
Process of negative electrode materials production
Before talking about graphitization production capacity, let’s take a look at the process of making negative electrode materials.
Seeing from the process, the production of a qualified negative electrode material is mainly divided into the following steps, namely: raw material pretreatment, mixing, granulation, graphitization, screening, etc. Among them, granulation and graphitization have high technical barriers and are the core competitiveness of negative electrode manufacturers.
Not only is the technical barrier high, but also the cost of graphitization processing. If the cost of the negative electrode is split, it can be found that the graphitization process accounts for 50% of the total cost. It is even higher than the cost of raw materials, and is the most important cost item.
Therefore, for an anode material company, graphitization layout is not only a manifestation of technology, but also a guarantee for the future.
Because in the future, if enterprises want to expand the production of negative electrodes on a large scale, they must break through the bottleneck of graphitization, so as to achieve cost optimization.
Current status of graphitization capacity
Let’s take the situation of the negative electrode industry in 2021 as an example. On the surface, it seems that the industry is undersupplied and lacks the production capacity of negative electrode materials. In fact, what the industry lacks the most is the production capacity of graphitization.
Of course, the mainstream negative electrode manufacturers have also seen this. Therefore, in recent years, they have deployed graphitization one after another, and the proportion of external graphitization is gradually decreasing. Hence, when we learn about the expansion of a negative electrode manufacturer, we should not only pay attention to the final production capacity, but also to the expansion of graphitization.
Although graphitization is scarce, at present, it is not easy to expand production. That is because graphitization is a high-energy-consuming project that takes up energy indicators, the official approvals from the government are also slowing down.
It is precisely because this official approval is more difficult, those companies that get the indicators early and have a high proportion of graphitization will take the lead in the industry.
Exploration of next generation of anode materials
Although the excellent cycle performance of artificial graphite has enabled it to achieve large-scale applications in power batteries. But industry insiders have not given up exploring the next generation of anode materials. At present, the silicon carbon anode is most likely to become the next generation of anode material.
Silicon carbon negative electrode, as the name suggests, is made by converting the original pure carbon negative electrode (graphite) into a silicon-doped negative electrode with the doping method.
Its biggest advantage is its high energy density. The highest specific capacity of the current artificial graphite anode can reach about 370mAh/g. While the silicon carbon anode can theoretically reach 4200mAh/g, which can greatly increase the cruising range.
There are two technical routes for silicon carbon negative electrodes:
1-one is doping silicon oxide in carbon negative electrodes,
2- and the other is doping pure silicon.
At present, Tesla has adopted the silicon oxide route, but the actual effect is not particularly ideal. So the industry is generally trying another technical route, that is, doping pure silicon.
Although doping pure silicon can obtain higher specific capacity. But now, the technology is not very stable. What’s more, all enterprises are in the stage of pilot test line and have not yet entered the stage of mass production.
Let’s take Putailai, the leader in the anode industry, as an example. There are reserves of silicon-carbon anode and other routes, but they are still being optimized.
Summary
After talking about the next-generation negative electrode technology route, let’s make a summary of this part.
The negative electrode material mainly plays the role of storing and releasing electric energy, and its unit price is lower than that of the positive electrode material. The current mainstream route is artificial graphite.
From the perspective of the industry structure, due to the lack of graphitization ability, the supply of anode materials has been in short supply in the past two years.
Due to the high barriers and high energy consumption of graphitization, it is not easy to expand in recent years, which limits the supply of the industry to a certain extent. Therefore, in the anode industry, we should not only pay attention to the expansion of anode materials, but also the expansion of graphitization production capacity.
For the next generation of anode materials, the current consensus in the industry is to dope silicon oxide or pure silicon to form anode materials with higher energy density. But it is still in the pilot stage, you can pay attention to the related progress.
In the next part, we will come to the subdivision track with the most elasticity and the strongest periodicity in lithium batteries: electrolyte.
Electrolyte for Lithium Batteries
Composition of Lithium Electronic Electrolyte
In the first class, we mentioned that the main function of the electrolyte is to serve as a carrier for the migration of lithium ions to ensure the normal transmission of lithium ions between the positive and negative electrodes.
To complete the above functions, the electrolyte must have three parts, namely:
- Solute used to provide lithium ions
- Solvent for lithium ion transport medium
- Additives used in small amounts to improve performance
As we know from above, the comprehensive cost of the electrolyte is generally composed of the above three parts. Among them, the solute, 51% of the overall cost, while the solvent is 19%, and the additive is 16%.
It is these three parts that perform their own duties, so when we study, we will also divide them into categories and analyze the specific content in detail.
Because there are many proper nouns in the electrolyte link, before introducing the industry, we need to summarize the relevant nouns and routes. Let’s take a look at this table, which can reduce the cognitive barriers of the follow-up content.
Electrolyte
↙
↓
↘
1. Solvent
↓
2. Solute lithium salt
↓
3. Additives
↓
1.1 Conventional solvents
(1) Cyclic carbonate
- Polycarbonate (PC)
- Ethylene carbonate (EC)
(2) chain carbonate
- Polycarbonate (PC)
- Ethylene carbonate (EC)
- Ethyl Methyl Carbonate (EMC)
1.2 New solvents
(1) Carboxylate
(2) Sulfites
(3) Fluorinated solvents
2.1 Conventional solutes
(1) Lithium hexafluorophosphate （LiPF6）
(2) Lithium tetrafluoroborate （LiBF4）
2.2 New solutes
(1) LiFSI
(2) LiBOB
(3) LiTFSI
3.1 Film-forming additives
3.2 Overcharge protection additive
3.3 High and low temperature additives
3.4 Flame retardant additives
3.5 Rate-type additives
Industry trends of electrolyte
After reading the table, let’s pick some more important parts and elaborate on them, mainly the industry trends.
The first is the solvent. In order to cooperate with the high-nickel ternary positive electrode, more ethyl methyl carbonate, that is, EMC, will be used in the future solvent. Because the system constructed in this way is safer and has a better cycle life.
Then to the solute part. The most common and important solute is lithium hexafluorophosphate (LiPF6), also known as 6F.
Although it has excellent performance in terms of cost performance and safety performance. But it also has disadvantages, that is, poor heat resistance and water resistance: above 80°C, it will decompose and release harmful gas-hydrogen fluoride.
Therefore, the industry is also thinking of replacing it with a new type of lithium salt, that is, LiFSI, which we will mention later.
Now, let’s enter the industry part to see what changes have taken place in the industry this year.
First of all, let’s look at solvents. From the perspective of the market in 2021, the new production capacity of the entire industry is relatively limited. Because new entrants, OXIRAN and CAPCHEM have relatively limited production capacity, and the finished products produced by coal chemical companies are mainly concentrated in the front-end industrial-grade DMC, which needs to be processed into battery-grade DMC.
For more specific expansion of production, you can see the following chart for more specific expansion of production.
Expansion mode of solvent industry
↗
→
→
↘
1. Industry expansion
2. New entrants
3. New production mode
4. Coal-to-ethylene glycol project
→
→
→
→
① SHINGHWA (100,000 tons in Dongying, 40,000 tons in Quanzhou)
② Shandong Haike (Jiangsu 120,000 tons)
① CAPCHEM (3.2 tons, 21 years for self-use)
② OXIRAN (30,000 tons)
① TINCI Materials (70,000 tons, industrial purification to battery grade, mainly for personal use)
① HUALU HENGSHENG
(mainly ethylene glycol, by-product industrial grade DMC, for purification)
② CNSG ANHUI Hong SIFAN
③ Zhejiang SINOPEC
Now, let’s enter the industry part to see what changes have taken place in the industry this year.
First of all, let’s look at solvents. From the perspective of the market in 2021, the new production capacity of the entire industry is relatively limited. Because new entrants, OXIRAN and CAPCHEM have relatively limited production capacity, and the finished products produced by coal chemical companies are mainly concentrated in the front-end industrial-grade DMC, which needs to be processed into battery-grade DMC.
For more specific expansion of production, you can see the following chart for more specific expansion of production.
Now that the rules of these years have been used as a foreshadowing, the electrolyte market in 2021 is also understandable. From the beginning of 2021 to May 2021, the price of electrolyte has risen from RMB 30,000 / ton to RMB 70,000 / ton, and the price of 6F has risen from RMB 80,000 / ton to RMB350,000 / ton.
The price increase slope of 6F is much higher than that of electrolyte, because there is a gap between supply and demand in this industry. And this gap is not the terminal electrolyte, but 6F and the additive VC.
So it is easy for everyone to understand such a logic: the price increase slope of 6F is much greater than that of the terminal electrolyte, which will inevitably lead to the continuous shrinking of the price difference between the two.
However, those companies that only produce electrolyte and do not have a 6F layout can greatly reduce their profitability. On the contrary, companies that plan to have more 6F production capacity have huge flexibility in profitability.
This points out a key point of the industry, that is, at this stage, the importance of 6F is far greater than the electrolyte of the terminal.
For the additive track, the current gap in VC is the largest. On the one hand, the terminal demand has increased significantly. On the other hand, it is also caused by the large-scale use of VC due to changes in the formula of iron-lithium batteries in recent years.
This situation also creates a very dramatic situation: if there is no long-term contract, even if you have money, you cannot buy VC. As an example, we post the production expansion of related companies and the output of VC in recent years for your reference.
Major VC manufacturers in China
Company | Capacity in 2021/ton | Expansion plan |
Jiangsu HSC | 3000 | 1,000 tons of new expansion in 2022 |
HICOMER | 1800 | Jiangsu Hankang plans to expand 59,000 tons of additives |
Suzhou HUAYI | 1200 | Dalian Huayi plans to expand 10,000 tons |
Rongcheng Qingmu | 1000 | Add 1000 tons in 2021 |
TINCI Tianshuo | 1000 |
|
Fujian Bohong | 700 | Add 1000 tons in 2022 |
Fujian Chuangxin | 500 |
|
Tai’an Zixin | 500 |
|
Suzhou CHEERCHEM | 300 |
|
Shandong Yonghao | 2000 | New capacity, expected to start production in June 2021 |
Total | 12000 |
We can know from the above structure of the industry that prices are increasing in several subdivisions.
It is precisely because of the price increase that the next generation of high-cost new lithium salts appears to be more feasible. At this stage, this new type of lithium salt is the bisfluoride (LiFSI) we mentioned earlier.
Of course, according to the records of people in the industry, difluoro is not a replacement for 6F, but a supplement, mainly to enhance the original performance.
According to relevant forecasts, if we look at the entire battery industry, the proportion of difluorine added in the future will be about 20%, and 30% in ternary, which is higher than the 10% mentioned in the research report.
Not only for the current electrolyte formula, but also for the technical reserve of difluoride, many companies have optimized it for the next generation of battery materials. For example, the carbon-silicon negative electrode we mentioned earlier, high-nickel ternary, and even solid-state and semi-solid batteries.
Therefore, there is a high probability that difluorine can be adapted to the next-generation lithium battery material system, and future applications will not be a problem.
At the end of SFC, let’s also take a look at the expansion plans of various companies. You can see the picture below.
Current and planned production capacity of major global LiFSI companies
Nation | Company | Existing production capacity (Tons) | Planning capacity (Tons) | Total production capacity (Tons) |
Japan | Catalyst | 300 | 2000 | 2300 |
South Korea | Tempo | 720 | 280 | 1000 |
China | CHEMSPEC | 1700 |
| 1700 |
China | CAPCHEM | 200 | 2400 | 2600 |
China | Fluolyte Battery | 300 | 700 | 1000 |
China | YONTA Technology | 500 | 1000 | 2000 |
China | TINCI Material | 2300 | 4000 | 6300 |
China | DFD New Energy |
| 1000-2000 | 1000-2000 |
China | Jiangsu HSC | 200 | 800 | 1000 |
Total |
| 6220 | 11180 | 17900 |
The electrolyte is mainly composed of three parts, which are solute, solvent and additive. Although the main themes of the three subdivisions are price increases, each has its own differences. In addition, although there are many expansions of solvent production, it may not be too much when it comes to EMC, where high nickel is widely used.
And solute, that is, 6F, is the king of price increases in 2021, and related companies also have plans to expand exponentially. The profit side has huge flexibility, and the gap in VC is also very huge.
For the next generation of lithium salts, difluoro is the current industry’s first choice. Moreover, opinions on the addition ratio of difluorine are not the same. At present, many research reports mention that it is only 10%. According to industry insiders, if the electrolyte of all batteries is included, the proportion of difluorine can reach 20%. If you only look at the popular ternary, this ratio is as high as 30%.
Diaphragm: The Strongest Track in the Middle Reaches
At the end of the last part, we mentioned that the battery separator is the best section in the upstream of lithium batteries.
In the first part, we have briefly introduced the role of the battery separator.
In this part, let’s put aside the function and start with the product. The battery separator mainly has two films, one is the “base film” and the other is the “coating film“.
# The base film is functionally complete.
# The coating film is mainly to improve the performance of the battery, such as increasing the thermal stability of the base film.
Two production processes of the battery separator - Wet & Dry
Now, let’s take a look at the two production processes of the battery separator, dry method and wet method. We can see the comparison chart of the two processes.
New Energy Comparison of Dry and Wet Separators
Characteristic | Parameter | Dry process | Wet process | Comparison |
Consistency | Pore size distribution (μm) | 0.01-0.3 | 0.01-0.1 | Wet process has better pore structure consistency |
Porosity | 30%-40% | 35%-45% | Higher porosity in wet process | |
Thickness (μm) | 12-30 | 5-30 | Wet process has better thickness consistency | |
Stability
| Transverse tensile strength/Mpa | <100 | 130-150 | Wet process has stronger tensile strength and higher mechanical stability |
Longitudinal tensile strength/Mpa | 130-160 | 140-160 |
| |
Safety | Puncture strength (gf) | 200-400 | 300-550 | Wet process has better puncture strength |
It is not difficult to see that the wet process is higher in uniformity and air permeability, and thinner in thickness. It can be said that it is in the lead in terms of performance indicators.
In fact, except for thermal stability and price, the wet method is better than the dry method in almost all aspects. But the disadvantage of poor thermal stability can also be solved by coating the film, so the wet method has gradually become the mainstream.
According to the survey, the China’s shipment of lithium battery diaphragms in 2019 was 2.74 billion square meters, of which the shipment of wet diaphragms reached 1.99 billion square meters, accounting for 72.6%, which can be described as absolute mainstream.
Although the wet method has gradually become the mainstream due to its performance advantages, since 2020, the blade battery represented by BYD
Although the wet method has gradually become the mainstream due to its performance advantages, since 2020, the rise of blade batteries represented by BYD has brought the dry method back to everyone’s vision. In the traditional impression, the dry method is more suitable for lithium iron phosphate, and the wet method is more suitable for ternary.
So why is there such a difference?
This has to start with the cost of the two types of batteries.
As we said earlier, the cost of ternary batteries is more expensive. If the thickness of the separator is thinner, more space can be reserved for other active materials. This is relatively cost-effective for the more expensive ternary battery. Therefore, the wet method, which is more suitable for thinning, has become the first choice of ternary.
In fact, there is no strict technical boundary between these two routes. Because some ternary manufacturers also use the dry method, and some lithium iron phosphate manufacturers also use the wet method. It depends on the technical system of the battery manufacturer.
But in general, with the expansion of energy storage and other fields, the demand for full lithium phosphate is also rising. And the lower-cost dry method will also usher in its own opportunities.
About the battery separator industry
After briefly introducing the current mainstream wet process, let’s take a look at the structure of this industry.
The battery seperator industry is essentially a fine chemical industry, which is capital-intensive and technology-intensive.
According to calculations, among the four subdivided materials, the battery separator is the second highest capital expenditure per GWh, second only to the cathode material. And the depreciation cost of the diaphragm link accounts for 17% of the total cost, which is higher than other subdivision tracks.
Higher capital expenditures mean higher barriers to entry because you’re spending more money after all. The second depreciation accounts for a large proportion of production costs, which means that the level of capacity utilization will significantly affect the company’s profitability. In other words, the operating threshold is also high.
After talking about the threshold of cost, let’s look at the technical barriers.
Simply put, equipment manufacturers are unwilling to expand production, which leads to the inability to quickly release the production capacity of the diaphragm, suppressing the supply side. And because the expansion period is also long (2 years), it is easy to cause a mismatch between supply and demand.
At present, the equipment for producing separator is generally monopolized by Japanese and German companies due to high technical barriers. Besides, the overseas companies are unwilling to expand production. All of those results in the inability to quickly release the industry’s production capacity.
Specifically, Enjie, the industry leader, has locked all the steel factories and some Toshiba’s production capacity in 2020. And the same is true for other leading companies, which makes other players unable to expand their production lines. The supply of the whole industry is relatively limited.
Therefore, considering the barriers of capital and technology, and the barrier of the entire barrier, the growth of supply will be relatively limited in the next two years. The growth is limited, and the demand is increasing year by year, which naturally creates the strongest track in the midstream.
At the end of this part, we have sorted out the lithium battery industry chain.
First of all, let’s take a look at the whole industry map of power batteries. This article mainly focus on materials.
Finally, let’s talk about the background. The rise of the entire lithium battery industry in 2020 is inseparable from the efforts made by Chinese material companies to reduce costs and increase efficiency in the past three years from 2017 to 2019.
Therefore, although all major materials are clamoring for “price increase” in 2021, “cost reduction and efficiency improvement” is still an eternal theme. So choosing the right route and expanding production is the kingly way. Once the technology is “falsified”, the huge production capacity will become a burden instead.
Guide for Lithium Battery Materials Industry
Lithium battery material industry map
Upstream | Middle stream | Downstream | |
Lithium, cobalt, nickel, manganese and other mineral resources | Battery Raw Materials | Battery manufacturer | Power Battery |
positive electrode、negative electrode、electrolyte 、separator
| 3C consumer battery | ||
Energy storage | |||
Advantages and disadvantages of three metals in ternary materials
Metal Type | Advantage | Shortcoming |
Nickel | High nickel helps improve battery energy density | Excessive nickel content will reduce battery cycle life |
Cobalt | Stabilizes battery chemistry to help improve conductivity and cycle performance | very expensive |
Manganese | Inexpensive, improves structural stability and safety | High content affects energy density |