the price of lithium carbonate, which soared more than seven times in one year, continued to swim at the 500000 yuan mark
According to the data of Shanghai Nonferrous Metals network, on March 10, the average price of domestic battery grade lithium carbonate was 501000 yuan / ton, up 2000 yuan / ton compared with the previous day, with the lowest price of 497000 yuan / ton and the highest price of 505000 yuan / ton.
price increase due to short supply
The recent price rise of lithium carbonate is remarkable.
According to the monitoring data of business society, on December 9, 2021, the price of battery grade lithium carbonate was still about 218000 yuan / ton, which means that it has increased by more than 130% in recent three months.
Back to the beginning of 2021, the price of lithium carbonate was less than 60000 yuan / ton, which has increased by more than 700% so far.
Why did the price of lithium carbonate soar? The main reason is the contradiction between supply and demand.
Zhang Xiang, a researcher at the automotive industry innovation research center of Northern University of technology, told the reporter of the international finance news that due to the strong demand in the new energy vehicle market, which exceeded the supply capacity of the upstream, the supply was in short supply, and then the price rose.
Guotai Junan Securities Co.Ltd(601211) also pointed out that the rapid rise in the price of lithium carbonate was mainly due to the urgent demand for lithium carbonate from lithium iron phosphate manufacturers, especially from overseas energy storage batteries.
In terms of supply, the reduction of lithium salt production is also an incentive to push up prices. According to the statistics of Cathay Pacific Securities, in January 2022, lithium salt and material manufacturers successively overhauled, and the output of lithium carbonate and lithium hydroxide decreased by 3% month on month.
In addition, some market analysts believe that there is no lack of speculation factors in this round of lithium carbonate price surge, and some lithium salt suppliers and intermediate traders hoard goods and are reluctant to sell.
Recently, some media reported that resistance has appeared in the lithium carbonate related industry chain, and even plans to reduce production.
However, a number of relevant persons from leading manufacturers of lithium salts, cathode materials and batteries denied the above statement.
Beijing Easpring Material Technology Co.Ltd(300073) board secretary office told reporters: “we do cathode materials, and we will not stop doing business because of the sharp rise in prices, especially considering that the downstream demand is still very strong. At present, the company’s capacity utilization is very high, basically in full production, and there is no problem with the volume of customer orders.”
The situation on the demand side can also be seen from the shipment volume. On March 9, Farasis Energy (Gan Zhou) Co.Ltd(688567) announced that from January to February 2022, the export volume of automotive power batteries in China reached 1.61gwh, an increase of 273.93% year-on-year.
industry chain middle and lower reaches under pressure
The impact of price increases is directly reflected in the financial report.
On the evening of February 21, Sichuan Yahua Industrial Group Co.Ltd(002497) took the lead in disclosing the performance forecast of the first quarter, and is expected to realize the net profit attributable to the parent company of RMB 900 million to RMB 1.2 billion, with a year-on-year increase of 105367% to 143822%. In 2021, Sichuan Yahua Industrial Group Co.Ltd(002497) net profit was 925 million yuan, which means that its net profit in the first quarter of this year may exceed that of last year.
The price of lithium carbonate has risen rapidly, and the pricing strategy of upstream enterprises has also changed.
Chengxin Lithium Group Co.Ltd(002240) the person from the board secretary office said in an interview with the reporter of the international finance news, “now it is basically market-oriented. Whether it is the upstream or downstream of the company, the quantity is locked without price, and the price is fixed monthly or quarterly.”
Sichuan Yahua Industrial Group Co.Ltd(002497) also said in February this year that the current understanding of the products of the long-term association is very different from that in the past. It only locks the quantity, not the price.
Tianqi Lithium Corporation(002466) also said that the price of lithium carbonate products of the company follows the market and is set once a month, which is reflected in a certain lag in the financial statements.
In sharp contrast to the scenery of upstream enterprises is the pressure of the middle and lower reaches.
According to the performance express released on Farasis Energy (Gan Zhou) Co.Ltd(688567) february 27, in 2021, the company achieved a revenue of 3.403 billion yuan, a year-on-year increase of 203.97%, a net loss attributable to the parent company of 974 million yuan, and the scale of loss doubled compared with 331 million yuan last year.
Farasis Energy (Gan Zhou) Co.Ltd(688567) said that in the early stage, based on the market trend of raw materials from 2018 to 2020, the company negotiated pricing with customers, the sales price was low, and provided certain price concessions for key customers. In addition, the prices of raw materials of the company’s main products have risen sharply, and the cost of materials has increased.
Tianfeng Securities Co.Ltd(601162) research shows that if the impact of bargaining power and procurement volume on the actual procurement cost is combined with the hedging of performance technology progress and cost rise, the cost rise transmitted from the price rise of raw materials to the power battery end is about 20% to 25%.
Battery manufacturers will also choose to raise prices to stabilize the cost pressure, and more downstream car enterprises need to pay for it.
Tianfeng Securities Co.Ltd(601162) estimates that for pure electric vehicles, when the price of lithium carbonate rises to 300000 yuan / ton, the cost of each pure electric vehicle will rise by about 8000 yuan; When the price of lithium carbonate increases to 400000 yuan / ton, the cost of each electric vehicle increases by about 11000 yuan; The impact on plug-in hybrid vehicles is also within 10000 yuan.
industry calls for upstream development
Will the price of lithium carbonate rise?
Northeast Securities Co.Ltd(000686) pointed out that the contradiction between supply and demand in the lithium industry may exist for a long time, and is optimistic about the long-term high prosperity of “white oil” lithium resources. In the short term, the contradiction between supply and demand is difficult to alleviate, and the high price is supported. On the supply side, the impact of lithium enterprise maintenance has not been completely eliminated. Due to resource shortage, the overall operating rate of the industry is still less than 50%. At the same time, due to weather constraints, China’s salt lakes have less output increment and tight supply. On the demand side, it is expected that the demand for high nickel is expected to increase month on month, the procurement demand is not reduced, the gap between supply and demand is enlarged, there is purchasing replenishment sentiment in the downstream, and the lithium price is expected to continue to rise or remain high.
In the long run, the prosperity of the lithium industry may exceed expectations. In terms of supply, there are few deterministic supply increments, many overseas lithium resource projects under construction are in early stages, and the government is cautious about the development of lithium resources, so the supply situation may be more tense in the future. In terms of demand, new energy vehicles have entered a stage of rapid development, energy storage lithium batteries will usher in an explosion period, and electric vehicles + energy storage will contribute to the core increment in the future.
The soaring price of lithium has triggered the attention of regulators. On February 28, Xin Guobin, Vice Minister of the Ministry of industry and information technology, said at the press conference of the state information office that this year, China will moderately accelerate the development of lithium, nickel and other resources, and crack down on unfair competition such as hoarding and driving up prices. At the same time, we will improve the recycling system of power batteries, support technical breakthroughs such as efficient disassembly and recycling, and constantly improve the recycling rate and resource utilization efficiency.
In addition, the voice of developing the upstream has also repeatedly appeared in the national “two sessions” this year. Zeng Yuqun, member of the CPPCC National Committee and Contemporary Amperex Technology Co.Limited(300750) chairman, pointed out in the proposal that the current supply and demand situation of lithium resources is grim and the development of the industry is facing challenges. China should accelerate the exploration and development of lithium resources, strengthen independent innovation and scientific and technological research, and improve the level of resource recycling and efficient utilization.
Jiang Weiping, deputy to the National People’s Congress and Tianqi Lithium Corporation(002466) chairman of the board of directors, also suggested to speed up the development and utilization of lithium resources in Sichuan, learn from the successful development and operation experience of excellent mines at home and abroad, and promote the green development of mines.
