Abstract
Recently, Tianci, Shandong Shida Shenghua Chemical Group Company Limite(603026) and other enterprises announced to expand the production of DTD. We think about DTD as a film-forming additive. What is the future industrial trend? How about adding proportion, technical improvement and cost reduction space? How flexible is it to relevant listed companies?
Industry trend: the requirements for long endurance and cycle times are increased, and DTD has become a new expensive additive
Low cycle times and battery attenuation are one of the pain points in the electric vehicle industry, affecting the sense of use experience. At present, the charging and discharging times of ternary batteries in many models are about 800, and that of lithium iron phosphate batteries is about 2500. However, most batteries cannot maintain the mileage in the initial state after 800 / 2500 cycles, because the battery will decay, and the mileage will decrease with the increase of cycles.
Tesla, Ningde and other enterprises have laid out long-life batteries. In May 2020, Tesla submitted a patent on “nickel cobalt aluminum (NCA) electrode synthesis method”, which will support the service life of electric vehicle batteries to 1.6 million kilometers and realize 4000 charge discharge cycles. In June 2020, Contemporary Amperex Technology Co.Limited(300750) chairman Zeng Yuqun also said: the company is preparing to produce ultra long-life power batteries with a service life of 16 years or a driving mileage of more than 2 million kilometers.
Tesla battery research partner Jeff Dahn team published a paper in 19 years, announcing that the battery under development in cooperation with Tesla has a service mileage of more than 1.6 million kilometers, and the new battery can also carry out 4000 charge and discharge cycles under the extreme temperature of 40 degrees. The experimental battery adopts single crystal nmc532 soft pack battery, in which the electrolyte solute is 6F, the additive is 2% VC and 1% DTD.
DTD: improve high and low temperature and cycle performance
DTD (vinyl sulfate) is a sei film-forming additive with an average addition ratio of about 1%. In addition, DTD can also be used as pharmaceutical intermediates and raw materials for the synthesis of antihypertensive drugs. As an electrolyte additive, DTD has the following main functions: 1) improve the performance of battery high-temperature cycle, high-temperature storage and low-temperature discharge; 2) Reduce battery expansion after high temperature placement, reduce capacity attenuation and internal resistance; 3) Inhibit the decrease of the initial capacity of the battery and increase the initial discharge capacity; 4) Improve the stability of graphite negative electrode and improve the cycle performance of battery.
DTD process flow & cost reduction space
From the perspective of process path, oxidation method is the mainstream path at present. The starting material is ethylene glycol, which reacts with dichlorosulfoxide to produce intermediate vinyl sulfite, and then forms DTD through oxidation. At present, there are difficulties in cost, product index and waste. DTD is a new additive, and the process is not yet mature. We believe that cost reduction can be achieved by:
Manufacturing cost: DTD is similar to solute 6F and additive lifsi, both of which are upstream materials of electrolyte. At present, the demand for DTD is small, and it is expected to have high manufacturing costs. Guangdong Tonze Electric Co.Ltd(002759) in 2020, the manufacturing cost of 6F accounted for 20.6%, and the manufacturing cost of kangpeng technology in the lifsi cost structure in 2019 accounted for 46.6%. With the production expansion of leading enterprises, DTD is expected to have a strong scale effect.
Process improvement: in October 2018, Suzhou Huayi issued a patent to enable ethylene glycol and diethyl sulfate to react under alkaline catalyst to generate DTD. This method can reduce environmental pollution, is more environmentally friendly, and has the advantages of simple operation, safety and ideal yield.
Integrated layout: sulfoxide chloride and ethylene glycol are the main raw materials of DTD. With the increase of demand, the price rises. The price of sulfoxide chloride rises from 2600 yuan / ton on August 10, 2021 to 5500 yuan / ton in October, and about 4500 yuan / ton in January 2022, an increase of 70% compared with August 2021. Tianci is arranging part of the production capacity of thionyl chloride, which can reduce the production cost.
Industry space & competition pattern
We predict that the price of DTD will be about 240000 / T in 2021, assuming an annual decrease of 10%, the prices will be 216000 / T and 157000 / T in 2022 and 2025 respectively, the DTD demand is expected to be 94000 and 42000 tons respectively, the market space is RMB 2.0 billion and 6.6 billion respectively, and the CAGR will be 48% in 22-25 years. Since 2018, DTD market supply has increased and domestic substitution has been gradually realized. At present, enterprises expanding DTD production include Guangzhou Tinci Materials Technology Co.Ltd(002709) , Shandong Shida Shenghua Chemical Group Company Limite(603026) , Shenzhen Capchem Technology.Ltd(300037) , Yanyi, Zhejiang Fuwei, etc. Among them, Tianci, Shandong Shida Shenghua Chemical Group Company Limite(603026) and Yanyi have a large range of production expansion. It is estimated that Tianci’s DTD production capacity will reach 7000 tons in 2023.
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Both lifsi and DTD are new additives, and there are sulfoxide chloride in the synthesis path. Therefore, we compare them from the aspects of function, addition proportion, market space, process difficulty and so on.
Function: DTD mainly improves high and low temperature performance and battery cycle times; Lifsi has strong thermal stability, high conductivity and improved charge discharge efficiency. It is mainly used for ternary high nickel batteries.
Addition proportion & market space: we expect the addition proportion of dtd22 and 25 years to be 0.9% and 1.4% respectively, the demand is 94000 tons and 42000 tons, and the market space is 2.0 billion yuan and 6.6 billion yuan; Lifsi can be used as part of the main salt with a higher addition ratio. We expect that the addition proportion of lifsi in 22 and 25 years will be 2.1% and 3.3% respectively, the demand will be 21000 tons and 101000 tons, and the market space will be 7.3 billion yuan and 25.3 billion yuan.
Process difficulty: from the perspective of reaction steps, the synthesis process of lifsi is relatively complex, with more reaction steps and lower yield; From the reaction process, lifsi has high purity requirements, and controlling the impurity content is the technical difficulty. DTD is mainly due to the large amount of three wastes and the excessive sodium ions in the product, which affect the application effect of the product.
Investment advice
Guangzhou Tinci Materials Technology Co.Ltd(002709) : we predict that the shipment of Tianci electrolyte will be 144000, 350000 and 550000 tons in 21-23 years. Assuming that the addition proportion of DTD is 0.9%, 1% and 1.1%, the demand for DTD will be 1292, 3500 and 6050 tons. Assuming that the price of DTD decreases by 10% annually, it will be 24000, 216000 and 194000 respectively from 21 to 23, and the net profit per ton is expected to be 58000, 52000 and 47000 yuan respectively. Dtd2021-2023 will contribute a net profit of 80, 180 and 280 million yuan. Compared with lifsi, we expect that from 2021 to 2023, lifsi will ship 20000, 12000 tons and contribute a net profit of 260, 730 and 1.33 billion yuan.
From the perspective of patent layout, Tianci DTD may adopt a new process to dissolve ethylene glycol in aprotic organic solvent and introduce sulfuryl fluoride instead of thionyl chloride. In terms of purity, the DTD purity obtained by the preparation method in Tianci patent is more than 99.9%, which changes the influence of water and acid value in electrolyte on battery cycle performance and storage stability; In terms of cost and yield, the synthetic method in Tianci patent is simple, and the yield is more than 95%; In terms of pollution, ethylene glycol and sulfuryl fluoride are used as reaction raw materials, which has no environmental pollution and is suitable for large-scale industrial production.
Although DTD is lower than lifsi in terms of shipment volume, unit price and profit contribution, DTD, as an additive with gradually clear addition trend, can also bring some flexibility to Tianci. We expect DTD’s profit to account for more than 5% in 23 years. Even if the profit of 6F has decreased significantly in 23 years, new additives such as lifsi and DTD are expected to improve the profit level of electrolyte.
Shandong Kaisheng New Materials Co.Ltd(301069) : sulfoxide chloride is an important raw material in the common synthesis path of DTD and lifsi. Shandong Kaisheng New Materials Co.Ltd(301069) the production capacity of thionyl chloride has reached 150000 tons / year, which is the world leader. The company has advantages in raw materials, technology and scale, and its gross profit margin is higher than that of its peers. In 2020, the gross profit margins of Shandong Kaisheng New Materials Co.Ltd(301069) and Jiangxi Selon Industrial Co.Ltd(002748) thionyl chloride were 43.3% and – 5.9% respectively.
Risk tip: DTD has greatly expanded production, the shortage of raw materials affects shipments, the demand for new energy vehicles is less than expected, new additives replace DTD, and the calculation is subjective.
