Yunnan Yuntianhua Co.Ltd(600096) announced on February 16 that it would join hands with lithium battery upstream and downstream enterprises such as Yunnan Energy New Material Co.Ltd(002812) , Eve Energy Co.Ltd(300014) and Huayou holdings to reach a cooperation agreement on the whole industrial chain project of new energy batteries with the people’s Government of Yuxi City, Yunnan Province. In the follow-up, it would carry out in-depth cooperation in mining of mineral resources, deep processing, R & D and production of new energy batteries and related materials to build industrial clusters in the local area.
In terms of the construction of batteries and upstream and downstream materials, the project is planned to be invested in three phases. The first two phases will be completed before December 31, 2025, with a total committed investment of 51.7 billion yuan. The third phase is a long-term investment target and will be implemented by the above four companies.
In recent years, benefiting from the high growth of downstream demand and the continuous improvement of the proportion of lithium iron phosphate installed capacity, phosphorus chemical enterprises with upstream resource advantages have crossed the field of new energy batteries and frequently promoted production expansion plans.
The project brings together four giants
From the perspective of all participants, the whole industry chain project of Yuxi new energy battery can be described as a gathering of Giants: Yunnan Yuntianhua Co.Ltd(600096) is the leader in the phosphorus chemical industry, with a phosphorus ore production capacity of 14.5 million tons / year; Yunnan Energy New Material Co.Ltd(002812) is the “first brother” of lithium diaphragm, accounting for 39% in China and over 27% in the world; Eve Energy Co.Ltd(300014) in 2021, the loading volume of power battery was 2.92gwh, ranking eighth in China, with a market share of 1.9%; Huayou holdings is the controlling shareholder of Zhejiang Huayou Cobalt Co.Ltd(603799) , which is the world’s largest cobalt smelting enterprise.
According to the announcement, the above-mentioned project cooperation will focus on the whole industrial chain of new energy batteries, and the construction content covers the development of mineral resources, batteries, diaphragms and supporting projects of positive and negative materials.
In terms of cooperative development of mineral resources, Yuxi Municipal government will jointly establish two companies with all participants, which are mainly engaged in mineral development and mineral deep processing. In terms of equity structure, Yuxi Municipal government or its designated subject holds 23% of the shares and is the largest shareholder; The shareholding ratios of Yunnan Energy New Material Co.Ltd(002812) , Eve Energy Co.Ltd(300014) , Huayou holdings and Yunnan Yuntianhua Co.Ltd(600096) are 22%, 20%, 18% and 17% respectively.
In terms of the construction of batteries and upstream and downstream materials, the supporting battery, diaphragm, iron phosphate, lithium iron phosphate, copper foil and other projects are planned to be invested in three phases. The first phase will be completed before December 31, 2023, with a committed investment of about 18.05 billion yuan; Phase II will be completed before December 31, 2025, with a committed investment of about 33.65 billion yuan; Phase III is the long-term investment target and is planned to be completed by 2030. The above-mentioned three-phase investment will be implemented in the form of project companies directly established by four enterprises, including Yunnan Energy New Material Co.Ltd(002812) , Eve Energy Co.Ltd(300014) , Huayou holdings and Yunnan Yuntianhua Co.Ltd(600096) .
According to the cooperation agreement, Yunnan Energy New Material Co.Ltd(002812) , Eve Energy Co.Ltd(300014) and Huayou holdings need to complete the promised investment scale on schedule after the joint venture mining company obtains the corresponding lithium mineral resources. Otherwise, Yuxi Municipal People’s government will repurchase the equity of the joint venture mining company held by the above three parties according to the investment difference.
phosphorus chemical enterprises cluster across borders
Since 2021, the upstream materials of lithium battery represented by lithium carbonate have risen sharply, and cost reduction has become the focus of the whole industry. The rise of high cost-effective lithium iron phosphate battery has begun to surpass the previously dominant ternary battery, driving the demand for lithium iron phosphate cathode materials to continue to rise. Phosphorus chemical enterprises, with raw materials such as phosphoric acid and cost advantages, have full power to transform the lithium iron phosphate industrial chain, which has formed an investment boom in the industry.
As early as the end of 2020, Yunnan Yuntianhua Co.Ltd(600096) invested and built 5000 t / a lithium hexafluorophosphate and other fluorine silicon projects based on fluorine silicon resources, a by-product of phosphate fertilizer, together with Do-Fluoride New Materials Co.Ltd(002407) , which is planned to be completed in 2022; In October 2021, the company announced the construction of 500000 T / a iron phosphate battery new material precursor and supporting projects. The overall estimated investment of the project is 7.286 billion yuan, of which the first batch of 100000 t / a iron phosphate projects and supporting facilities are expected to be completed in June 2022; Remaining 2 × 200000 tons is expected to be completed in December 2023.
Coincidentally, Hubei Yihua Chemical Industry Co.Ltd(000422) also announced its intention to cooperate with Ningbo bangpudacheng integrated battery material supporting chemical raw material project under Contemporary Amperex Technology Co.Limited(300750) in October 2021. The two sides plan to establish a joint venture to build and operate iron phosphate, nickel sulfate and its front-end phosphate rock, phosphoric acid, sulfuric acid and other chemical raw materials, as well as supporting phosphogypsum weekly transfer and phosphogypsum comprehensive utilization projects.
In November 2021, Hubei Xingfa Chemicals Group Co.Ltd(600141) and Zhejiang Huayou Cobalt Co.Ltd(603799) signed a cooperation framework agreement to build an integrated industry of phosphate rock mining and beneficiation, phosphorus chemical industry, wet process phosphoric acid, iron phosphate and lithium iron phosphate materials in Yichang, Hubei Province, and to build 500000 T / a iron phosphate, 500000 T / A lithium iron phosphate and related supporting projects. A joint venture with a capacity of 300000 tons of phosphoric acid is planned to be established in Yichang. At present, the two sides have set up a joint venture with a capacity of 300000 tons of phosphoric acid in Yichang.
In addition, Anhui Sierte Fertilizer Industry Ltd.Company(002538) also reached an agreement with Rongjie group in September 2021 to establish a joint venture company engaged in the production of lithium iron phosphate. The total investment is expected to be 2 billion yuan, and the target output of lithium iron phosphate is 50000 tons / year.
Although the investment boom has hit, industry insiders said that subject to factors such as technology and energy consumption indicators, it is still uncertain whether the aforementioned iron phosphate and lithium iron phosphate projects can be put into construction and when they will be completed and put into operation, so it is necessary to be vigilant about capacity release.
