Chinese li-ion battery market is “booming”
According to market intelligence firm, CCM, China’s lithium-ion battery industry is “booming” with nearly 80% of the world’s new investment in li-ion batteries occurring in China in 2014. Furthermore, China produced 5.6 million li-ion batteries in 2015, with a total capacity of around 15.7GWh, triple the 2014 figure. Lastly, in its 2015 annual report, Shanshan Corporation, China’s largest supplier of li-ion battery material, reported that revenue increased by 17%, and net profit by 90%.

While the China’s economy is still wandering in the bottom, the development of alternative energy vehicles and li-ion battery are booming greatly with the promotional policies from the Chinese government, according to CCM .





Source: Bing







With the exposure of annual reports from the li-ion battery companies, good news was spreading rapidly in the capital market.

The major battery enterprises in the global are also keeping up with the trend and speeding up their layout about li-ion battery industry in China. Attributed to the steady growth in the demand of the downstream Computer, Communication and Consumer Electronic industries, the li-ion battery market enjoys a bright future in development.

Nearly 80% of the new investment in li-ion battery globally was located in China in 2014. There were 25 li-ion battery projects in China with the scale of investment over RMB100 million. Multinational enterprises like Samsung SDI and LG Chem are active in developing li-ion battery in China.

In the past five years, the growth of electrochemical energy storage market in China is obviously faster than that in the global market, with the CAGR (2010-2015) of 110%, six times as high as that of the global. Among it, the installed capacity of li-ion battery captured 66% of the market share in the electrochemical energy storage market.

In 2014, China outputted 5.43 billion pieces of li-ion batteries, with the CAGR of around 40% and accounting for about 70% of the total output in the global, according to CCM’s new report Market and Development Trend of Li-ion Battery in China, 2016-2020, which will be published in June 17.

The output of Li-ion battery exceeded 5 million for the first time in 2014 and reached 5.6 million in 2015, up by 3.13% YoY. As for the capacity, in 2015, the domestic output of power Li-ion battery increased to 15.7GWh, triple than that of the last year.

Rapid rise in the li-ion battery shares

With the blooming of li-ion battery, the li-ion battery share becomes a popular investment. In 16 May to 18 May, 2016, nearly RMB2.6 billion went into the li-ion battery market, with Tianqi Lithium, Ganfeng Lithium and GEM CO., Ltd. inflowing the most capital into the market.

Thanks to the price increasing of the upstream raw materials and rising sales volume of the downstream products, most of the li-ion battery listing companies recorded great growth in both its revenues and net profits.

On 18 May, Shanghai index closed at 2850.93, up 0.84%, with the trading volume of RMB 126.8 billion. Though the index was still around 2850, the shares of li-ion battery were rebounding. The li-ion battery index has kept rising for three days, up 9% greatly.

Enterprises arrange business actively

The major battery enterprises in the global are keeping up with the trend and speeding up their layout about li-ion battery industry in China.

Samsung

On 13 April 2016, Samsung SDI, a subsidiary of Samsung Group, announced to completely exit the fuel cell market and focus on developing the li-ion battery industry.

According to the spokesman of Samsung SDI, the bleak future of the fuel cell market was the main reason why they decided to exit. With the expanding application of li-ion battery and the decreasing production cost, fuel cell could no longer content with li-ion battery.

In 2015, Samsung SDI invested KRW682.2 billion in battery development, including KRW528.8 billion in energy solution and KRW153.4 billion in fuel cell.

In 2016, Samsung SDI would keep investing in the current manufacturing infrastructures and construct new manufacturing infrastructures in Europe.

Currently, the annual capacity of Samsung SDI’s li-ion battery factories in Ulsan, Korea and Xi’an, China could meet the need of 200,000 alternative energy vehicles.

In the past few years, to reduce the operating cost, Samsung SDI simplified its organization structure, at the same time, it divested a lot of its non-core business and focused on the battery development.

In 2016, Samsung decided to invest KRD1 trillion in li-ion batteries, up 40% compared to that in 2015. Samsung SDI also stated that the second battery business would be a new growth for the company.

Cho Nam Seong, president of Samsung SDI, said: “Before 2020, they would invest over KRW3 trillion in the li-ion battery industry and are determined to make Samsung SDI an over world-class battery supplier.”

He also claimed that they would develop a new type of li-ion battery which could be charged fully for one time and be able to serve the alternative energy vehicle to travel 600 kilometers. At present, Samsung SDI is actively promoting the development of batteries with high output power and large capacity such as “all-solid batteries”, “lithium air batteries” and “lithium metal batteries”.

Ningbo Shanshan Co., Ltd.

Ningbo Shanshan Co., Ltd. (Shanshan Corporation) was listed in Shanghai Stock Exchange in 1996. It covers three main businesses including clothing, material of li-ion batteries and investment.

Shanshan Corporation was the first batch of enterprises to enter the li-ion battery material market. Owning six manufacturing enterprises and one institute, Shanshan Corporation has become China’s biggest and world’s top three supplier of li-ion battery material.



In 18 April, Shanshan Corporation released its 2015 annual report. According to the report, the net profit was RMB665 million, up 90.81% YoY; the annual revenue was RMB4.302 billion, up 17.58% YoY. Its earnings per share was RMB1.618.



The rapid increase on the net profits was mainly attributed to the rising profits from their main business, especially the increasing price of cathode material in the fourth quarter. In fact, Shanshan Corporation covers almost the whole industrial chain of li-ion battery: cathode materials, anode materials, electrolyte, and separators…

Shanshan Corporation also stated that they would expand the downstream alternative energy vehicle industry and integrate the current li-ion battery material industries.



The rapid development of alternative energy vehicles in China has driven the development of the power li-ion battery and its upstream industry. The power li-ion battery and its related industries has become a cash cow now.

If you are looking for an opportunity to enter this cash-cow industry, you could be expecting our new report of Market and Development Trend of Li-ion Battery in China, 2016-2020 (to be published in 17 June), to understand and to know more about the supply and demand situation of li-ion battery in China.

The report provides you with the information about the whole industrial chain including Lithium hexafluorophosphate (LiPF6), Lithium carbonate, cathode materials, anode materials, separators and electrolyte.

With the clearly and completely listing of the promotional policies on the li-ion battery industry from the Chinese government, you could better judge the whole market and make correct decisions in the next five years.

For more information about the report Market and Development Trend of Li-ion Battery in China, 2016-2020 or the li-ion battery market, you could contact us at econtact@cnchemicals.com and search li-ion battery in CCM’s Online Platform.





About CCM:

CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.

For more information about CCM, please visit www.cnchemicals.com or get in touch with us directly by emailing econtact@cnchemicals.com or calling +86-20-37616606.



