China Fund News reporter Feng Yao

Lithium carbonate prices from a high "avalanche" to 100000 yuan/ton, has remained stable for several months. However, after entering March, lithium carbonate came out of a wave of rebound, superimposed on the overall recovery of new energy vehicle terminal sales in March, and the long-silent lithium carbonate track seemed to see the long-lost "dawn".

However, in the opinion of many industry insiders interviewed by the reporter, it is too early to judge that the downstream demand for lithium carbonate has been significantly boosted.

In the industry's view, in the power battery link, many car companies since the Spring Festival price reduction promotion, so that the pace of demand or a front, the second quarter or overdraft part of the second half of the demand. In terms of energy storage, there are large variables on the demand side, but under the stimulus of a sharp decline in costs, downstream manufacturers hit the 630 grid-connected time node, or become a major factor in stimulating short-term demand.

In this context, the market has appeared a lot of "lithium carbonate prices into the upward channel" voice. The stock prices of many lithium salt manufacturers, including Jiangte Electric and Tibet Mining, also rose sharply on April 2.

The industry generally believes that the price of lithium carbonate does not have room for a sharp rise and fall in the short term.

Price reduction promotion or overdraft demand in the second half of the year

"Price reduction promotions have indeed boosted sales. Car companies usually only carry out large-scale promotions from mid-to-late March to around April, but this year it has been advanced to around mid-February. Some car companies have responded that the effect of price reduction promotions is indeed More than they expected." A power battery manufacturer told reporters.

From the data, a shadow effect. Among them, BYD returned to the 300000-car mark; GAC Ean's monthly sales once again exceeded the boundary and ideal, and the price reduction strategy of returning to more than 30000 new energy vehicle companies played a solid role. The delivery volume of a number of new energy vehicle companies, including extreme krypton, zero run and Wei Lai, has also returned to more than 10,000 vehicles.

According to the latest market research institutions, in March, the battery, positive electrode production with the recovery of obvious and more than the January level on the basis of the overall lithium power production in April increased by about 10% month-on-month. In the market view, the supply of upstream lithium carbonate is also expected to resonate with downstream demand.

According to another senior lithium battery analyst interviewed by the reporter, the demand for power batteries may continue in April. She said that in addition to price reduction and promotion, the effect of the "trade-in" policy will gradually appear. "The Beijing auto show at the end of April will also boost terminal sales."

Therefore, in her view, under the superposition of multiple factors, the terminal demand for new energy vehicles may increase significantly from March to April.

In fact, Orient Securities Futures also mentioned in a report that under the superposition of auto prices, policy-side trade-in, and multiple stimuli from auto shows, the pace of demand may be ahead, and the second quarter or overdraft part of the demand in the second half of the year.

"Our expectation for the growth rate of power batteries for the whole year is basically the same as before, at a year-on-year growth level of 20%. Maybe there will be some revision later, but it depends on the specific performance of the following market." The aforementioned analysts said.

Energy storage demand remains highly uncertain

At the end of energy storage demand, the industry generally believes that the industry is facing a large number of variables this year.

Looking back on the shipment of energy storage batteries in recent years, in 2022, due to the rapid outbreak of demand, the energy storage industry staged a "high demand rise and price increase" of the high business climate, the rapid growth of demand has also led to various manufacturers have opened production expansion plans.

By 2023, the sudden "flameout" of terminal demand made the market heat once dropped to the "freezing point", and the mismatch between supply and demand led to intensified competition in the inner volume. Nevertheless, according to SNE data, from a global perspective, the shipments of energy storage batteries in 2023 will still reach 185GWh, maintaining a high growth.

However, due to the new players cut in, rapid capacity expansion, resulting in energy storage product prices continue to fall, and even has broken through the cost line of many manufacturers. At the beginning of the year, Gaogong Lithium predicted that the price of energy storage batteries would stabilize at around 0.4 yuan/Wh in 2024, while the price of energy storage systems would stabilize to 0.8 yuan/Wh, but disorderly competition below the cost price would still exist.

But at present, the energy storage market price trend is afraid to exceed previous expectations. "Now the unit price of the energy storage system is basically around 0.6 yuan/Wh, which is basically the 1/3 of two years ago," a central enterprise energy storage system manufacturer told reporters.

It is not difficult to see that the "price war" in the current energy storage link is no less than the new energy vehicle industry. For this year's overall demand, the aforementioned lithium-ion analyst analysis pointed out that, first of all, the current domestic energy storage power station utilization rate is generally low, and it is more difficult to achieve profitability, the subsequent allocation of storage is likely to decline.

On the other hand, overseas, Europe's overall inventory is at a high level, "optimistic estimates, inventory levels are sufficient to consume until mid -2024". She said that coupled with the slow growth of the European market economy, there may be a decline in energy storage subsidies in some countries, leading to a weakening of investment willingness. "We think the overall energy storage demand in Europe will decline in 2024."

However, she also mentioned that the domestic 630 (I .e. before June 30) is still the time node for installed grid connection, and some projects that have not been connected to the grid by the end of 2023 may be delayed until mid -2024 to complete grid connection delivery. In her view, this is the main driving force for energy storage demand in the short term.

Lithium ore, lithium salt manufacturers inventory is still high.

In the industry view, whether from the power battery end or energy storage end, it is difficult to form long-term support for lithium carbonate demand.

And it is worth noting that lithium ore, lithium salt manufacturers lithium carbonate inventory is still relatively high, short-term no initiative to reduce the actual action of the library. This can be seen from the statements of listed companies that have disclosed their annual reports.

From the lithium salt manufacturers that have disclosed their 2023 annual reports, many upstream manufacturers' inventory balances have increased compared to the same period in 2022.

For example, Tianqi Lithium's inventory balance as of the end of 2023 was 3.151 billion yuan, while at the end of 2022, this figure was 2.144 billion yuan; Shengxin Lithium's inventory balance at the end of 2023 was 2.931 billion yuan, slightly higher than the 2.743 billion yuan at the end of 2022.

On the contrary, the intention of battery manufacturers to remove inventory is obvious. The inventory balance at the end of 2023 in Ningde era was 45.434 billion yuan, a sharp drop of more than 40% from 76.669 billion yuan at the end of the previous year.

Hongyuan futures analyst Wang Wenhu believes that the current downstream demand is not strong enough, making the downstream resistance to high prices, the price is difficult to form a breakthrough. In addition, lithium ore prices with lithium carbonate prices higher, lithium carbonate costs move up, to provide support, the price of the lower edge of the same difficult to break through the support. At the same time, the more stable and reasonable inventory quantity and structure of the industrial chain also play a role in stabilizing price fluctuations.

He believes that for the trend of lithium carbonate, the medium and long term should focus on two aspects: first, whether the growth rate of production and sales of new energy consumption terminals will decline next, resulting in lower than expected real demand and a drag on prices; second, whether the mineral resources in the third quarter can be landed as scheduled.

In fact, lithium salt manufacturers also expressed their views on the expected price of lithium carbonate. A head lithium salt manufacturer told reporters that the lithium carbonate market after February 2024 has improved compared with the second half of last year, but the current in stock price of lithium carbonate is still around 100000, and the futures price fluctuates in the range of 100000-110000 yuan. He believes that the price of lithium carbonate this year is mainly stable and will not fluctuate greatly.

Ganzhou Shengu Lithium New Material Technology Co., Ltd. is currently well-known in the domestic lithium industry. Most of the major cooperative enterprises are listed companies, including Ganfeng Lithium Industry (the world's top 500 lithium industry leader); Sichuan can invest in its heyday. Sheng Xin Li Neng (listed company), Jiujiang Ronghui; Chuaneng Power; Rongbai Technology (material leader); Bertray (Ningde's main supplier); Nantong Ruixiang (state-owned enterprise); BASF (World Top 500); Xiamen Xiangyu (World Top 500) and other enterprises have in depth cooperation, and get a higher degree of recognition. Looking forward to taking the east wind of the industry, Ganzhou Shengu Lithium New Material Technology Co., Ltd. will usher in faster and better development.

Reviewed by: Wood Fish