Five major trends in the lithium battery copper foil market in 2022

The surge in power battery shipments has driven the explosion of the lithium battery copper foil market. 

Data show that China’s electrolytic copper foil shipments in 2021 will reach 656,000 tons, a year-on-year increase of 48.5%. Among them, lithium ion battery copper foil was driven by the strong demand in the downstream market, and the shipment volume reached 280,500 tons, a year-on-year increase of 122.9%.

Driven by strong market demand, in 2021, China’s lithium battery copper foil companies will generally be full of production and sales, and product supply will exceed demand. Related copper foil companies can refer to Top 10 global lithium battery copper foil companies in 2022.

For example, NORD will release new copper foil production capacity in 2021, and lithium battery copper foil will be fully produced and sold.

Telford Technology’s lithium battery copper foil shipments rose rapidly, with monthly shipments rising from 1,000 tons in the first half of the year to 2,000 tons in the second half of the year.

The sales price of products superimposed by the boom in production and sales has increased, and the revenue and net profit of lithium battery copper foil companies in 2021 will increase significantly, and the net profit increase will exceed 70 times.

Among them, Nord shares achieved revenue of 4.446 billion RMB, a year-on-year increase of 106.32%, and a net profit of 405 million RMB, a year-on-year increase of 7421.93%;

Jiayuan Technology achieved revenue of 2.804 billion RMB, a year-on-year increase of 133.26%, and a net profit of 550 million RMB, a year-on-year increase of 195.02%;

Chaohua Technology achieved revenue of 2.47 billion RMB, a year-on-year increase of 93.49%; net profit of 71.886 million RMB, a year-on-year increase of 234.84%.

On the whole, in 2021, due to the surge in sales of new energy vehicles, the shipment of power batteries will increase significantly year-on-year, resulting in strong demand for lithium battery copper foil.
However, due to insufficient existing production capacity of copper foil companies and less than expected release of new production capacity, the supply of copper foil throughout the year is in a state of tension.

From the development of the above-mentioned copper foil companies, we can also see the changes and development trends of the current lithium battery copper foil industry:

Lithium battery copper foil companies are full of production and sales

Lithium battery copper foil companies are generally at full production and full sales, and gross profit margins have improved to improve product profitability.

Data shows that in 2021, China’s power battery shipments will be 226GWh, a year-on-year increase of 183%, driving a substantial increase in the shipments of lithium battery copper foil companies.

Among them, the production volume and sales volume of NORD’s copper foil reached 35,633 tons and 35,047 tons respectively, and the gross profit margin increased by 5.69% to 24.61%;

Telford Technology’s annual shipment of lithium battery copper foil exceeded 20,000 tons, a year-on-year increase of more than 3 times;

Jiayuan Technology’s lithium battery copper foil production and sales were 27,890 tons and 27,775 tons respectively, and the gross profit margin of the products increased by 4.34% to 30.23%.

The lithium battery copper foil of the above-mentioned companies is basically in a state of full production and sales, and the supply is in short supply, and the overall delivery pressure is relatively large.

The substantial increase in sales volume and the increase in product price have boosted the gross profit margin of copper foil companies’ products, thereby improving product profitability.

The output of lithium battery copper foil cannot keep up with market demand

The expansion of lithium battery copper foil has accelerated but cannot keep up with the growth of market demand, and the lack of supply of key equipment has become a constraint.

In order to further meet the downstream market demand and enhance competitiveness, lithium battery copper foil companies are accelerating the pace of capacity expansion and the release of new capacity.

China plans to add nearly 1 million tons of lithium battery copper foil production capacity, with a total investment of over 60 billion RMB.

In 2021, Nord will speed up the production capacity construction of Qinghai and Huizhou bases, and the current total production capacity will reach 85,000 tons/year.

In January 2022, the 100,000-ton annual copper foil project of Nord Co., Ltd. was settled in Huangshi, Hubei, and the production capacity was further increased.

Telford Technology currently has two production bases in Jiujiang, Jiangxi and Lanzhou, Gansu. It is expected that the production capacity of lithium battery copper foil will reach 65,000 tons/year in 2022.

At the same time, it plans to build a new capacity of 150,000 tons of lithium battery copper foil in Lanzhou. By 2025, the total production capacity of the Lanzhou base will reach 200,000 tons per year.

In addition, copper foil companies including Jiayuan Technology, Longdian Huaxin, Tongguan Copper Foil, Zhongyi Technology, and Xin Bo Rui have all launched new capacity expansion projects in 2021.

It is worth noting that, in addition to copper foil companies, upstream copper companies such as Hailiang Co., Ltd., Baiyin Nonferrous Metals, Jiangxi Copper Industry, etc. have made use of their competitive advantages in copper raw materials and copper processing to enter the copper foil industry to build lithium battery copper foil production capacity. , open up new business growth points.

Although the above-mentioned copper foil companies are accelerating the expansion of production capacity, the release of new production capacity cannot keep up with the growth rate of market demand for power batteries, resulting in the overall supply of lithium battery copper foil in 2021 is still tight.

At the same time, the production capacity of cathode rollers, the key production equipment for lithium battery copper foil, is seriously insufficient, and the production orders for cathode rollers worldwide have been placed after 2024, which has hindered the expansion of lithium battery copper foil production in China.

Copper foil companies accelerate the layout

The thinning direction of lithium foil is clear, and copper foil companies are accelerating their layout.

In 2021, Chinese power battery companies will significantly speed up the introduction of 6μm copper foil. 6μm copper foil has become the main shipment of copper foil companies, with individual companies accounting for over 80% of shipments.

In order to further improve the energy density of batteries, head battery companies are accelerating the introduction and application of ultra-thin copper foils below 6μm. The monthly consumption of 4.5μm copper foils in CATL has increased from 100 tons to 1,000 tons, and the penetration rate has increased significantly.

Battery companies such as China Innovation Aviation and Honeycomb Energy are also accelerating the introduction of 4.5μm copper foil.

At present, a few companies such as Nord Co., Ltd. and Telford Technology have supplied 4.5μm copper foil products to head battery companies in small batches.

Companies such as Jiayuan Technology, Longdian Huaxin, Chaohua Technology, Tongguan Copper Foil, Zhongyi Technology, and Xin Bo Rui are also accelerating the pace of R&D and mass production of 4.5μm copper foil.

Battery companies deploy copper foil for lithium batteries

Battery companies deploy copper foil for lithium batteries and build a diversified supply system.

In order to ensure the stable supply of lithium battery copper foil and maintain stable prices, battery companies are deploying the supply chain of lithium battery copper foil by investing in shares and building joint ventures.

For example, CATL indirectly invested in Telford Technology; Honeycomb Energy invested in Jiangxi Copper Yates; Guoxuan Hi-Tech invested in Tongguan Copper Foil, and BYD invested in Tongbo Technology;

Ningde Times and Jiayuan Technology jointly built a copper foil project with an annual output of 100,000 tons; Yiwei Lithium Energy and Tongling Huachuang jointly built a lithium battery copper foil project with an annual output of 100,000 tons.

On the whole, the layout of lithium battery copper foil through equity participation and joint venture construction will become an effective way for battery companies to maintain their own supply chains, reduce production costs, and improve product profitability. It is expected that other battery companies will deploy lithium battery copper foil in the later period.

Lithium battery copper foil track heats up

Copper foil companies collectively sprint for IPO, and the lithium battery copper foil track heats up.

In addition to introducing strategic investment from battery companies and capital, lithium battery copper foil companies are also accelerating the pace of IPOs and landing in the capital market to raise funds to expand production.

Among them, Tongling Nonferrous Metals and Jiangxi Copper spun off their copper foil subsidiaries Tongguan Copper Foil and Jiangxi Copper Yates, independently IPO raised funds to expand production, and Tongguan Copper Foil Growth Enterprise Market IPO has been submitted for registration;

The IPOs of Zhongyi Technology and Telford Technology have also been accepted and accepted respectively, and it is expected that other copper foil companies will sprint for IPOs in the later stage.

From the perspective of the industry competition pattern, the market concentration of the electrolytic copper foil industry is generally low.

With the successive deployment of upstream and downstream companies in the copper foil industry, coupled with the listing and expansion of many copper foil companies, it may have a profound impact on the overall competition pattern of lithium battery copper foil in the future. If you want to know about other battery material companies, you can refer to Top 10 lithium cobalt oxide cathode material companies and Top 5 lithium iron phosphate cathode material companies.