recently, a number of lithium suppliers have released the financial report and performance forecast for 2022. from the overall situation, the lithium industry has made a lot of money in the past year: tianqi lithium estimates that the net profit in 2022 will be about 23.1 billion to 25.6 billion yuan, with a year-on-year increase of 1011.19% to 1131.45%; according to the performance forecast released by ganfeng lithium, it is estimated that the profit will be 18 billion to 22 billion yuan in 2022, with a year-on-year increase of 244.27% to 320.78%; salt lake said that it was estimated that the net profit attributable to shareholders of listed companies last year was 15 billion to 15.6 billion yuan, an increase of 234.94% to 248.33% over the same period last year; tianhua super net is expected to achieve a net profit of 6.4 billion to 6.8 billion yuan in 2022, with a year-on-year increase of 602.76% to 646.68%.
in response, several lithium mining enterprises explained that this was mainly due to the rapid development of the new energy vehicle industry, which drove the growth of the demand for lithium salt in the whole industry, thus driving the company's performance to increase significantly in 2022. however, with the frequent decline in lithium carbonate prices since the end of last year, and the slowdown in the growth of the new energy vehicle industry this year, the ultra-fast growth trend of the lithium industry may be difficult to continue. according to citic securities research report, the inflection point of lithium price may come in 2023, and the price may fall back from the high level. in 2024, as the pressure of oversupply increases, lithium price will decline significantly.
"ten thousand taels of gold when lithium ore rings"
according to the statistics of wind, as of february 8, 129 companies related to wande lithium mine and power battery had announced the performance forecast, and 83 companies were expected to increase (advance, slightly increase, continue to gain, and turn loss), accounting for more than 60%. among them, the upper limit of net profit of four companies, including tianqi lithium, ganfeng lithium, byd and salt lake, exceeded 10 billion yuan. in terms of growth, the performance of 53 companies doubled, and the net profit of rongjie, jixiang and tianqi lithium increased by more than 10 times.
as for the reasons for the substantial increase in performance, tianqi lithium said that this was mainly due to the promotion of the global new energy vehicle boom, the acceleration of capacity expansion of lithium-ion battery manufacturers, the increase of orders for downstream cathode materials and other positive factors. the sales volume and average sales price of the company's main lithium products in 2022 were significantly higher than that in 2021. ganfeng lithium also believes that in 2022, the demand for lithium salt from downstream customers will grow strongly, and the sales price of lithium salt products has increased significantly compared with the same period last year.
the performance of lithium mining enterprises is "soaring" directly due to the rise of lithium price. according to smm analysis, in addition to the fact that the downstream demand was affected by the epidemic last april, which caused the lithium carbonate price to be temporarily pressed the pause button, the overall lithium salt price in 2022 continued to rise due to the terminal power, the demand for energy storage and the expansion of downstream capacity, and hit the historical high of 567500 yuan/ton on november 9. subsequently, against the background of weak downstream demand, the spot price of lithium carbonate was slightly revised back at the end of the year, but it was still at a relatively high level. according to the data disclosed by everbright securities, the average price of battery grade lithium carbonate in the four quarters of 2022 is 400000 yuan/ton, 471700 yuan/ton, 479900 yuan/ton and 547200 yuan/ton respectively. in the whole year, the price of domestic battery grade lithium carbonate will increase by about 84% in 2022. it is no wonder that industry insiders joked that "once the lithium mine rings, there will be ten thousand gold vehicles".
the reason why lithium prices have risen crazily is the rapid expansion of the new energy vehicle industry, which is caused by the imbalance between supply and demand. according to the analysis, in the first quarter of 2022, the spot price of nonferrous lithium carbonate (99%) in shanghai rose rapidly from 275000 yuan/ton to 503000 yuan/ton due to the stimulation of european and american policies, the rapid growth of the terminal market and the accelerated expansion of production in the middle of the industrial chain. in the second quarter of 2022, the sales of new energy vehicles decreased significantly due to multiple factors. in the second half of 2022, as the sales of new energy vehicles continued to maintain a high growth, lithium prices stabilized and rose again, stimulated by china's postponement of the purchase tax exemption policy for new energy vehicles, the implementation of the inflation reduction act in the united states, and the adoption of the 2035 ban on the sale of fuel vehicles by the european parliament. driven by the hype of the australian lithium concentrate auction, lithium prices hit a record of 567500 yuan/ton in november 2022.
the supply and demand structure may be improved this year
will the phenomenon of "eating meat upstream and drinking soup downstream" continue this year?
xu ying, a lithium analyst at smm, said that with the expansion of mines in the later stage, the relationship between lithium salt supply and demand may turn to oversupply, but the cost of lithium ore will still form a certain support for lithium salt prices. with the expected excess supply of raw materials and the downward price of the cost side, the price trend of lithium salt will be further affected, and the supply and demand structure of lithium salt may be improved.
with the continuous expansion of the base of the new energy vehicle market, the industry generally believes that the growth of the global and china's new energy vehicle market will slow down this year. bloomberg predicted that the global sales of new energy vehicles will reach 13.6 million in 2023, with a year-on-year increase of about 35%, which is significantly lower than the growth rate of 55% in 2022. the situation in china is estimated to be similar. according to the prediction of the china automobile industry association (hereinafter referred to as the "china automobile association"), the domestic sales of new energy vehicles may exceed 9 million this year, with a year-on-year increase of about 32%. even from the absolute value of the market increase, the overall sales of domestic new energy vehicles in 2023 will only increase by about 1 million to 1.5 million units compared with last year, and will be reduced by half compared with the absolute increase of the market in 2022 (more than 3 million units).
industry insiders admit that china will still be the largest new energy vehicle market in the world, but with the official withdrawal of state subsidies, policy support will be weakened, or consumption demand will be reduced to some extent. this sign has appeared at the beginning of the year. according to statistics, the total retail sales of passenger car market in january 2023 was 1.293 million, down 37.9% year-on-year and 40.4% month-on-month. both year-on-year and month-on-month growth rates were the lowest in january since the beginning of this century. the car market did not achieve a "good start" in january. among them, the wholesale sales of new energy passenger vehicles were 389000, down 7.3% year-on-year and 48.2% month-on-month. the slowdown in the sales of new energy vehicles in december last year is still continuing. in january, the retail sales of new energy passenger vehicles reached 332000, down 6.3% year-on-year and 48.3% month-on-month. "at the beginning of the new year, the market has entered a transitional stage of consumers' expectation of policies." cui dongshu, secretary general of the national passenger car market information association, said that after the withdrawal of the national subsidies for new energy vehicles, the national new energy passenger car market entered the freezing point as scheduled in january, and will gradually recover. according to a source from a power battery enterprise, since the middle of december last year, some complete vehicle manufacturers have stopped placing orders to the upstream; on the other hand, after the withdrawal of subsidies, the market trend of this year is still unclear, and new pricing strategies are still in the process of deliberation. until then, the landing of upstream orders will be postponed.
in addition to the chinese market, europe, as the second largest market for new energy vehicles in the world, also has great uncertainty. although the european market has gradually stepped out of the haze since the fourth quarter of 2022 and the overall growth prospects are promising, the geopolitical conflict is still continuing, and the german new energy subsidy will decline to 1500~2000 euros/vehicle in 2023, which may have some impact. in addition, the rise of global protectionism may lead to the interruption of the industrial chain supply chain and inhibit the growth of production and sales of new energy vehicles. in particular, the us inflation reduction act intends to exclude chinese battery companies and material companies from its automotive power battery industry chain through differentiated subsidy policies, which will also affect other countries, thus affecting the global demand for lithium.
the chain reaction after tesla's price reduction
at the beginning of 2023, tesla launched an unprecedented "price reduction": the price of model 3 dropped by 36000 yuan, the price of model y dropped by 29000 yuan, and the price reduction range of the remaining versions of the two models ranged from 20000 to 48000 yuan, setting a new record low for tesla in china. this immediately triggered more fierce price competition in the new energy vehicle industry. before the spring festival holiday, the company and xiaopeng automobile quickly followed up and reduced the product price by nearly 30000 yuan; after the opening of the new year, more auto companies began to "fancy" price reduction. gac aian launched a time-limited delivery incentive of 5000 yuan per vehicle, as well as a financial subsidy of zero interest rate for three years and low down payment for a limited time; wuling motor announced that the starting price of hongguang miniev would be reduced by 3000 yuan to 29800 yuan before march 31; the price of saic feifan r7 electric separation model dropped to 195900 yuan, a decrease of about 20000 yuan; geely's emgrand brand also reduced the price of some new energy vehicles by 13000 yuan; even weilai, which boasts no price reduction, has adjusted its price in the way of "clearing the inventory". it is said that "weilai has started to reduce the price of 2022 models of es6 and es8, with a maximum price reduction of more than 100000 yuan". other auto companies have adopted various preferential measures, such as financial subsidies, deposit inflation, time-limited free optional accessories, discount on optional accessories, insurance subsidies, delivery incentives, and reduced prices in disguised form.
the direct impact of the "price war" on the market should be the increase of sales volume. unfortunately, except for tesla, the sales volume of "weixiaoli" and gac aian in january fell to different degrees. even the growth rate of byd, the largest domestic new energy vehicle in the same month, also decreased compared with the same period last year.
in the absence of rapid growth in market demand in the short term, under the "price war", cost control has naturally become an urgent issue for automobile enterprises. among them, the power battery, which accounts for 60% of the vehicle cost, is the first to bear the brunt. industry experts believe that after the forced price increase last year, new energy vehicle enterprises have made some adjustments to the supply chain more or less, such as increasing the number of suppliers, which has increased the voice of vehicle enterprises in the industry chain and made it possible for battery manufacturers to reduce prices. subsequently, in order to ensure their own profits, battery manufacturers are likely to further transmit the pressure of cost reduction to the upstream raw material supply chain. under the two-party game, even if the lithium price will not drop rapidly, the possibility of price increase will be greatly reduced.
accelerated industrialization of sodium ion battery
in order to reduce the cost of power battery and find a new technical route with stable raw material resources and low cost as another option, the industrialization process of sodium ion battery is expected to accelerate this year, thus replacing part of the market share of lithium ion battery.
securities institutions pointed out that due to the high price of lithium, more and more automobile enterprises have included sodium ion batteries in the key areas of research and development. it is reported that compared with lithium battery, sodium battery has the advantages of rich resources and low cost, good low-temperature performance, magnification and safety, and the production link can be connected with lithium battery. the pain point of practicality is that the energy density is low, generally between 80~170wh/kg, and the cycle performance is poor. it is estimated that the current material cost of sodium battery is about 0.427 yuan/wh, of which the cost of positive electrode, negative electrode and electrolyte accounts for 30%, 21% and 23% respectively. the estimated results show that the material cost after the industrialization of sodium battery will be 35% lower than that of lithium iron phosphate battery at that time.
according to the public information, many head power battery enterprises such as ningde times and yiwei lithium energy have started to layout the sodium-ion battery business. by january 2023, the planned capacity of the nation-wide sodium-ion battery has reached 48gwh. from the perspective of the scale of construction, ningde times is the largest, with the estimated shipment volume of 2gwh, and that of zhongke haina 1gwh; chuanyi will also have 1gwh in the second half of the year, with a planned capacity of 9gwh; hanhang technology expects 0.5gwh. at the same time, automobile enterprises are also trying to load sodium ion batteries. it is reported that the official of funeng technology has received the notice of jiangling group new energy "agreeing to carry out the preliminary suitability research of sodium ion batteries for ev3 models". the relevant models equipped with sodium ion batteries will be put on the market in 2023.
soochow securities said that it is expected that 2023 will be the first year of sodium ion battery industrialization, and small batch shipments will be realized, and mass production will be realized in 2024, and the scale is expected to reach 30gwh; zheshang securities believes that the total demand for sodium ion batteries is expected to reach 88gwh in 2025 and 378gwh in 2030. "the theoretical cost of sodium ion battery is low, the gap between energy density and cycle life and lithium battery is gradually closing, and its high magnification, low temperature resistance and safer characteristics have unique advantages over lithium battery, which is expected to initially form industrialization this year." the research report of securities institutions believes that this will divide up the market share of lithium ion battery to a certain extent, leading to further decline in the market demand for lithium ore.
in particular, as the seventh most abundant element on the earth, the reserves of sodium in the earth's crust are 420 times that of lithium. the global distribution is uniform, so there is no need to worry about the shortage.
limited short-term increment
in terms of lithium ore supply, although stimulated by the high lithium price, the global lithium resource development will increase significantly in 2022, but limited by many factors such as the long construction period to reach production, environmental protection policies and natural conditions, insufficient production factors, and the rise of resource protectionism, the lithium supply growth rate is still relatively slow, and the imbalance between supply and demand is significantly intensified. however, this problem is expected to be alleviated in 2023. many institutions pointed out that the global lithium resource supply is expected to achieve substantial growth in 2023.
it is reported that lithium resources and lithium salt plants have expanded rapidly under the stimulation of industrial profits. on the one hand, several overseas lithium resource projects are expected to be put into operation and put into production in 2023 after continuous construction and expansion, including not only the traditional large mines in australia and large salt lakes in south america, but also the acceleration of lithium project development in africa. on the other hand, the domestic lithium resource industry policy has been loosened, and a large number of lithium mica mines, salt lake brine, etc. are expected to accelerate their entry into the market. china's jiangxi mica, western sichuan spodumene, and qinghai salt lake will also release 68000 tons of new production.
according to the data calculated by fubao lithium power grid, the global lithium resource end is expected to release 352000 tons of new production in 2023. among them, 60% of australia's lithium resources projects will have new production release in 2023, and the annual increment of seven spodumene projects is expected to reach 115000 tons. overall, it is expected that the global lithium resource output will exceed 1 million tons in 2023, with a year-on-year increase of about 40%. especially in the second and third quarters of this year, the supply and demand situation of lithium market is expected to reverse and begin to loosen.
the forecast of citic securities research report is close to that. it is believed that the global lithium supply will reach 400000 tons in 2023. from 2023 to 2025, the global lithium supply surplus will account for 6%, 23% and 30% of the total demand, showing an upward trend year by year. due to the small proportion of surplus in 2023, the lithium price is expected to remain above 300000 yuan/ton. in 2024, the supply is expected to be substantially excessive, and the lithium price is expected to fall significantly, and the price may fall below 150000 yuan/ton.
however, because the supply release is not synchronized, some experts believe that there may still be a gap in lithium ore supply this year. "we have noticed that due to various factors such as labor shortage and power limitation, some lithium mines have been delayed in supply, such as australian and african mines, with limited increment in the short term," said jiang yan.
the price decline is a foregone conclusion
according to the data released by shanghai steel union, the price of lithium battery materials continued to decline on february 7, and the average market price of battery grade lithium carbonate fell by 1000 yuan/ton to 462500 yuan/ton. compared with the historical average price of 590000 yuan/ton in the middle of november last year, the price has dropped by 127500 yuan/ton, or more than 20%. as a matter of fact, this round of lithium carbonate price decline has been started as early as the new year's day this year. since december last year, the price of lithium carbonate has been declining for two consecutive months. especially on january 9, the price of battery grade lithium carbonate fell below 500000 yuan/ton, hitting a new low in more than four months.
so, what is the trend of lithium price in 2023?
the relationship between supply and demand remains the main determinant. some institutions have calculated the total supply and demand of lithium resources in the four quarters of 2023. on the supply side, by collecting, sorting out and comparing the volume of 44 major lithium resource projects in the world, it is estimated that the increment in the four quarters of 2023 will be 57000, 66000, 100000 and 129000 tons respectively; on the demand side, the demand increment of power battery, energy storage and small battery will be 57000, 63000, 73000 and 82000 tons respectively from the first quarter to the fourth quarter of 2023, and the total demand increment of the whole year will be 276000 tons. it can be seen from the comparison that the supply and demand of each quarter are - 0.1 million, 0.4 million, 2.6 million and 4.7 million tons respectively, and the situation of marginal supply exceeding demand will occur in the second half of 2023.
wang pingwei, chairman of china mining resources group, said in an interview with the media that the trend of lithium price decline will continue as more supplies appear to reduce the abnormally high profit margin of lithium producers. he predicted that the price of lithium would drop by about a quarter from the current level, but because the market was still tense, the price would not plummet. in 2023, the price of lithium carbonate will fall to about 400000 yuan per ton. at the same time, he believes that even at a lower price level, china mining will still have a good profit margin. "on the whole, the price of lithium carbonate will decline in 2023, but it is unlikely to return to the level of tens of thousands of yuan and hundreds of thousands of yuan per ton, and the rate will probably fluctuate between 300000 and 400000 yuan per ton." yu puritan, secretary-general of the zhongguancun new battery technology innovation alliance and director of the battery council of 100 people, told reporters.
author: yao meijiao source: china energy news · china energy storage network
