The price of lithium carbonate continues to rise. On August 24th, Shanghai Steel Union released data showing that the average price of battery-grade lithium carbonate rose by 3,500 yuan/ton to 491,000 yuan/ton today, and it rose six times in the past seven trading days; Industrial lithium carbonate rose by 4,000 yuan/ton to 479,500 yuan/ton, rising for seven consecutive trading days.

Chen Guanghui, an analyst of Cinda Securities Metals and New Materials, told Securities Daily that 'the price of lithium carbonate is rising rapidly, which is mainly driven by the rapid development of new energy vehicles and energy storage industries. The demand is strong and the supply is relatively insufficient, especially in the face of the market expectation of' Golden September and Silver 10'. The price of lithium carbonate still has rising momentum, and it is expected that it is very likely to exceed 500,000 yuan/ton. '

'The battery pack of new energy vehicles accounts for more than 40% of its overall cost. As the core source of cathode cost in Ferrous lithium phosphate, the price change of lithium carbonate is widely concerned by the new energy automobile industry chain. At present, not only the upstream mining enterprises are rushing to mine, but also other enterprises in the industrial chain have reduced the impact of rising lithium mine prices by buying mines, strategically investing in mining enterprises and hedging. ' Chen Guanghui said.

Or a shortage or mismatch?

Lithium carbonate prices continue to rise.

The rapid development of new energy and energy storage industries has driven the demand for lithium carbonate and other materials to blow out, causing price increases. According to the statistics of Baichuan Yingfu, in 2021, the apparent consumption of lithium carbonate in China was 303,400 tons. Among them, the domestic production is 240,000 tons, up 40.4% year-on-year; Imports reached 81,000 tons, up 61.7% year-on-year.

In September 2020, the price of industrial-grade and battery-grade lithium carbonate started from the lowest around 40,000 yuan/ton, and climbed to about 500,000 yuan/ton in the first quarter of 2022. Since then, there has been a correction, and recently it has started to rise rapidly.

What is the main reason for the soaring price of lithium carbonate in this round?

Chen Guanghui believes that the rapid increase of lithium carbonate price is mainly affected by the contradiction between supply and demand. In the first half of this year, the sales volume of passenger cars was 4.21 million, a year-on-year increase of 71%. Considering the peak consumption season in the second half of the year, the number of new energy vehicles in the world is expected to exceed 10 million this year, an increase of over 50% compared with 6.338 million last year. In addition, the power distribution of bicycles is still increasing, which will further increase the demand for lithium carbonate. On the supply side, this year's increase mainly comes from the restart and technical transformation of previously discontinued mines, while the concentrated release of production capacity of new investment projects will wait until the second half of next year, with limited short-term increase.

For the recent upward trend of lithium carbonate price, Qu Yinfei, lithium carbonate analyst of Shanghai Steel Union New Energy Division, told the Securities Daily reporter: 'Recently, the power cut in Sichuan has a great impact on the supply of smelting end, while in Qinghai, it is affected by the epidemic. The logistics and transportation are limited, which leads to the reduction of the supply of market circulation resources. The market is reluctant to sell, and the spot circulation price keeps rising. The downstream just needs to purchase, and the price-receiving ability is improved, and the upward speed of lithium carbonate price is accelerated.'

He Li, general manager of Zhishan Investment, told the Securities Daily that 'before 2020, the sales volume of new energy vehicles was relatively low, and the prices of lithium salts fell below the cost line of enterprises. A large number of lithium mining enterprises closed down and even faced the risk of bankruptcy. With the strong growth of sales of new energy vehicles in the second half of 2020, the energy storage market has also gradually broken out, resulting in a rapid growth of demand and a rapid reversal of the supply and demand situation. However, the release of lithium salt capacity takes at least 3 to 5 years, and overseas production expansion is relatively cautious, resulting in the skyrocketing price of lithium carbonate. '

Performance of upstream lithium mining company 'off the charts'

Enterprises in the middle and lower reaches join the mine grabbing war.

Under the high price of lithium mine, the upstream lithium mine enterprises have made a lot of money, and many listed companies have achieved 'off the charts'.

On the evening of August 24th, Tibet Mining released its semi-annual performance report for 2022. In the first half of 2022, the company achieved operating income of 1.22 billion yuan, a year-on-year increase of 439.2%, and a net profit of 480 million yuan, a year-on-year increase of 1018.3%. In terms of products, as the price of lithium salt products continued to rise and the company increased its sales, the revenue of lithium products increased by 961.55% year-on-year, and the gross profit margin reached 94.71%, up by 53.25% year-on-year.

According to the data of ifind of Straight Flush, as of the evening of August 24th, a total of 10 listed companies of lithium mines released the semi-annual report for 2022, all of which achieved a positive year-on-year increase in net profit attributable to their mothers, among which the biggest increase was Saddle Shares, with a year-on-year increase of 4701.10%. Zijin Mining made a huge profit of 12.63 billion yuan, and the net profit attributable to its mothers in half a year exceeded 10 billion yuan, with an increase of 89.95%.

Judging from the half-year results, on the evening of August 23rd, Contemporary Amperex Technology Co., Limited released the semi-annual report for 2022. The data shows that in the first half of the year, the company achieved operating income of 112.971 billion yuan, a year-on-year increase of 156.32%; Realized a net profit of 8.168 billion yuan, an increase of 82.17% over the same period of last year. Previously, on July 15th, BYD released its performance forecast, saying that it is expected that the company will realize net profit of 2.8 billion yuan to 3.6 billion yuan in the first half of 2022, up by 138.59% to 206.76% year-on-year.

Different from the upstream, the middle and lower reaches of the enterprise complain that the raw material price is too high.

And it's true. Take Tianqi Lithium Industry, a domestic lithium resource head enterprise, as an example. According to the company's recently released performance forecast, it is estimated that the net profit in the first half of the year will be 9.6 billion yuan to 11.6 billion yuan, up by 110.89 times to 134.20 times.

In the face of rising prices, more and more enterprises have joined the mine-grabbing war.

On August 18th, Guangzhou Automobile Aian New Energy Automobile Co., Ltd. signed a Strategic Cooperation Agreement with Ganfeng Lithium Industry. The two parties plan to cooperate from the upstream material side of new energy power batteries, and continue to explore in-depth cooperation at all levels of lithium resource development, deep processing of lithium salt in the middle reaches and comprehensive recycling of used batteries.

Coincidentally, on August 15th, BYD announced that it planned to invest 28.5 billion yuan in Yichun City, Jiangxi Province, which involved the project of building a comprehensive development and utilization production base with an annual output of 100,000 tons of battery-grade lithium carbonate and ceramic clay (containing lithium) ores.

Previously, Ganfeng Lithium announced that its subsidiary had completed the tender offer of Bacanora Company and held 100% equity. Bacanora's Sonora project is currently one of the largest lithium resource projects in the world, with a total lithium resource of about 8.82 million tons of lithium carbonate equivalent.

In addition, Contemporary Amperex Technology Co., Limited, Guoxuan Hi-Tech, Tesla and other enterprises have also made moves to acquire or take shares in lithium mining enterprises.

'At present, enterprises in the new energy industry chain are all coping strategies in the face of soaring resource prices by buying mines, participating in mining enterprises or hedging. We look forward to reducing the impact of rising lithium mine prices on enterprises through the above measures.' Chen Guanghui said.

He Li said: 'Lithium resource itself is indispensable. At the present stage, most of the profits are separated from the upstream, and the future profits will be redistributed in all links of the industrial chain. However, in the long run, the profits of upstream lithium resources and downstream applications in the industrial chain will account for the bulk. The industry expects that the supply of batteries will far exceed the demand in 2025, so the upstream and downstream integration of battery factories is very important. In fact, the upstream lithium mining enterprises are also expanding their battery business now, and it is also possible for enterprises in all links to form strong alliances. '