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In recent news, the lithium industry is experiencing significant profit differentiation. Ganfeng Lithium has indicated that industry capital expenditure will gradually contract. Throughout 2024, the lithium market continues to face intense price fluctuations and supply-demand changes, with lithium carbonate prices declining from ¥97,000/ton at the beginning of the year to ¥75,200/ton by year-end, putting considerable adjustment pressure on the industry.
Many publicly listed lithium companies have recently released their financial reports, revealing a clear divergence in performance. Salt lake companies are maintaining profitability due to their cost advantages despite a backdrop of declining profits. However, some lithium mining companies have reported losses. On March 31, Ganfeng Lithium stated that in the face of cyclical price fluctuations, the company will continue to focus on cost reduction and efficiency improvement, introduce more digital and intelligent tools to enhance efficiency, and intensify market expansion for new products while concentrating on high-quality projects.
In the lithium brine sector, Salt Lake Co. and Tengri Mining have welcomed major investors in 2024. By January 14, China Minmetals became the actual controller of Salt Lake Co. Meanwhile, a subsidiary of Zijin Mining is acquiring control over Tengri Mining through a share transfer agreement. Despite profit declines in 2024, benefiting from cost advantages in lithium extraction from salt lakes, both companies have managed to remain profitable during this downward price cycle.
In 2024, Salt Lake Co. achieved revenues of ¥15.134 billion, a year-on-year decline of 29.86%, with a net profit attributable to shareholders of ¥4.663 billion, down 41.07%. Tengri Mining reported revenues of ¥3.251 billion, a year-on-year drop of 37.79%, with a net profit of ¥2.580 billion, down 24.56%. Currently, potassium products account for 77.39% of Salt Lake Co.’s revenue, while lithium products make up only 20.32%. Salt Lake Co. has a current lithium carbonate production capacity of 40,000 tons, with plans to increase it to 43,000 tons by 2025, achieving a gross profit margin of 50.68% for lithium products.
On the other hand, Tengri Mining’s potassium chloride business constitutes 67.99% of its revenue, while lithium carbonate accounts for 31.43%. They achieved a lithium carbonate production of 11,600 tons, with sales of 13,600 tons and a gross profit margin of 45.44%. Unlike Salt Lake Co., Tengri Mining’s primary profits stem from investment income from its stake in Julong Copper, which contributes 74.72% of its net profit attributable to shareholders, approximately ¥1.928 billion.
Tengri Mining emphasizes its commitment to addressing industry cycle fluctuations and is promoting lithium extraction projects in Qinghai and Tibet, aiming to become a leader in the global salt lake lithium extraction sector and laying the groundwork for the long-term healthy development of emerging industries. However, it has been noted that Tengri Mining’s planned Marimicuo Salt Lake Project in Tibet, initially expected to commence production in 2024, has faced delays. In its 2024 annual report, the company stated it is fully advancing the project’s construction preparations and technological innovations to ensure efficient execution.
As the lithium industry faces evident differentiation, some lithium mining companies have entered a loss-making phase. The “double giants” of lithium mining have both reported losses in 2024. The shift in supply-demand dynamics and market fluctuations have resulted in declining sales prices for lithium salts and lithium battery products. In 2024, Ganfeng Lithium posted revenues of ¥18.906 billion, a year-on-year decrease of 42.66%, with a net profit attributable to shareholders of -¥2.074 billion, marking a 141.93% decline. Furthermore, Ganfeng Lithium has set aside asset impairment provisions totaling ¥479 million in 2024. On March 31, the company indicated that most of the impairment provisions were due to inventory depreciation losses across both the lithium salt and lithium battery sectors.
In 2024, facing adverse conditions such as price volatility in lithium products and declining performance of its joint venture company SQM, Tianqi Lithium reported revenues of ¥13.063 billion, down 67.75% year-on-year, with a net loss attributable to shareholders of -¥7.905 billion, a decline of 208.32%. However, it achieved countercyclical growth in lithium chemical product sales. In Ganfeng Lithium’s revenue composition, lithium series products account for 63.56%, while lithium battery series products make up 31.19%, reflecting a slight increase in the latter’s share compared to 2023.
In 2024, Ganfeng Lithium generated a net cash flow from operating activities of ¥5.161 billion, an increase of 3423.52% year-on-year, mainly due to reduced cash payments for goods and services as well as lower tax payments. However, net cash flow from financing activities decreased 66.26% due to increased cash repayments for debts. Despite the challenges faced in its core operations, Ganfeng Lithium has not halted its capacity expansion efforts. The company plans to establish a total lithium product supply capability of no less than 600,000 tons per year by 2030, encompassing capacity from lithium extraction from ores, brines, clays, and recycling. Currently, Ganfeng Lithium’s Goulamina lithium spodumene project has officially commenced production, the Cauchari-Olaroz salt lake project is in stable capacity ramp-up, and the Mariana project has also started production earlier this year. It is expected that the Mariana project will gradually stabilize its supply of lithium chloride products in the second half of this year, while the PPG lithium salt lake project is still in preliminary preparations.
On March 31, Ganfeng Lithium acknowledged that there has been a slowdown in the growth of supply in the industry, with investment sentiments reaching a low point, resulting in increasingly cautious capital investments. In light of this, the company anticipates a gradual contraction in industry capital expenditures, potentially leading to restrictions in future investment scales. In 2024, Ganfeng Lithium also proactively adjusted its capital expenditure pace to meet development funding needs through various channels and prioritized the development of low-cost, high-return projects. Despite the losses in 2024, Ganfeng Lithium will still distribute dividends to all shareholders, allocating a cash dividend of ¥1.50 per 10 shares (inclusive of tax). In 2024, the parent company reported a net loss of ¥147 million, and after accounting for retained earnings of ¥15.021 billion at the beginning of the year and subtracting the 2024 profit distribution of ¥1.610 billion, the retained earnings at the end of 2024 stood at ¥13.264 billion.
Another lithium mining company, Shengxin Lithium Energy, also faced losses, reporting revenues of ¥4.581 billion in 2024, a year-on-year decline of 42.38%, with a net loss attributable to shareholders of -¥622 million, down 188.51%. Currently, Shengxin Lithium Energy holds 52.20% equity in Huirong Mining, which operates the Mu Rong lithium mine—one of the highest-grade lithium mines in Sichuan. This mine has obtained a mining license from the Ministry of Natural Resources and has a production scale of 3 million tons per year, with active development and construction underway.
With its own lithium mine resources, Yongxing Materials achieved profitability in 2024, reporting revenues of ¥8.074 billion, a year-on-year decline of 33.76%, and a net profit attributable to shareholders of ¥1.043 billion, down 69.37%. In terms of gross margins, there is a clear differentiation among mining companies. In 2024, Ganfeng Lithium’s gross margin for lithium series products was 10.47%, likely due to its extensive business layout; Shengxin Lithium Energy’s gross margin for lithium products was only 2.84%, facing significant challenges in cost control. Tianqi Lithium achieved a gross margin of 63.71% for lithium mining products, while lithium compounds and derivatives had a gross margin of 35.21%. Yongxing Materials reported a gross margin of 36.65% for lithium carbonate, indicating strong profitability.
So far this year, there have been no evident signs of recovery in lithium prices. On March 31, Li Pan, a lithium analyst from Shanghai Steel Union’s new energy department, stated that recent carbonated lithium prices have fluctuated between ¥73,000/ton and ¥74,000/ton, with the average transaction price gradually decreasing. “The lack of a significant rebound in lithium prices can be attributed to several factors: the arrival of African mines has led to a decrease in lithium ore prices, weakening the cost support for lithium salts. Demand in April was not as expected at the beginning of the month. At present prices, downstream purchasing demand is exceptionally weak, and the rebound potential for spot lithium carbonate prices is insufficient. After a slight price correction, the market remains under pressure. Coupled with record-high available inventory, there is currently no shortage of goods in the market, and spot prices are expected to continue facing downward pressure,” Li Pan further pointed out. “From a fundamental perspective, inventory continues to accumulate in April, putting pressure on lithium salt prices. Attention should be paid to the cancellation of old warehouse receipts and the speed at which new warehouse receipts can be restored, as well as any new variables that may arise from the supply side. Short-term lithium carbonate prices are expected to fluctuate within the range of ¥72,000/ton to ¥74,000/ton, gradually shifting downward.”
On March 27, the 200MW/400MWh lithium-ion battery storage demonstration project in Qiubei County, Yunnan Province, officially commenced full-capacity grid connection. This is the only national pilot demonstration project of new energy storage in the province, located in the Qiubei County Industrial Park and invested by China Southern Power Grid Energy Storage Yunnan Co., Ltd.. The total investment for the project is ¥460 million, with an installed capacity of 200MW/400MWh, utilizing a grid-type energy storage technology, making it the largest lithium-sodium hybrid technology-based battery storage station in the country. Once operational, the project will effectively stabilize the regional power system, enhance the reliability of power supply in border areas, and significantly support the construction of a new power system, contributing to the green and low-carbon transformation of the economy and society in border areas.
The European Union has recently announced a plan to invest €1.8 billion to strengthen its battery raw material supply chain. This initiative aims to promote robust and sustainable development in the automotive industry and unleash its innovative capabilities. The plan will provide €1.8 billion (approximately ¥141 billion) to create a competitive battery raw material supply chain, supporting the production of electric vehicle battery cells and components through direct subsidies and other forms. This initiative builds upon the EU Commission’s launch of the “Future Strategy Dialogue for the European Automotive Industry” in January, aimed at enhancing the competitiveness of European car manufacturers through cooperation, targeted financing, and simplified regulations.
Announcements: Notice of the upcoming 2024 National Lead-Acid Battery Standardization Technical Committee Annual Meeting and the eighth plenary committee meeting. Battery magazine overlap rate detection. The WeChat account of the Shenyang Battery Research Institute is now operational.
Policy and Regulations: Environmental penalties: Multiple violations; Anhui Liwen Energy Power Battery Co., Ltd. fined ¥1.59 million. The Ministry of Industry and Information Technology has abolished the “Automobile Power Storage Battery Industry Norm Conditions” and related enterprise directories. The Ministry of Industry and Information Technology is seeking opinions on the admission conditions for the recycled lead industry. Should standby batteries comply with national standards?
Hot Topics: All lead-acid batteries, lithium batteries, sodium/magnesium-ion batteries, liquid metal batteries, metal-air batteries. As domestic lithium battery companies rush to list in Hong Kong, how did two predecessor companies fare last year? Amid the intense disclosure of progress for domestic lithium battery companies listing in Hong Kong, two “predecessor” companies released their 2024 performance reports on the same day. In this “stronger remains strong” industry, the report cards of these two non-“double giants” showcase both highlights and the struggles under industry “involution.” The performance report from Hong Kong-listed lithium battery company China Innovation Aviation (03931.HK) indicates that their 2024 revenue reached ¥27.752 billion, an increase of 2.76% compared to the previous year, with a profit of ¥844 million, up 93.14% year-on-year, and a net profit attributable to shareholders of ¥591 million, up 101.02% year-on-year. China Innovation Aviation is now the fourth largest power battery company globally and was the first power battery stock listed on the Hong Kong Stock Exchange in October 2022, with a current market value of approximately HKD 33.7 billion, having seen its stock price rise nearly 50% this year. In the previous year’s revenue composition, power batteries and energy storage systems each accounted for nearly 70% and 30%, respectively. The company’s gross profit margin increased by 2.9 percentage points to 15.9% compared to 13.0% in 2023, attributed to business expansion and continuous growth, showcasing the scale effects. According to data from South Korea’s SNE Research, the power battery installation volume of China Innovation Aviation increased by 16.6% year-on-year, ranking fourth globally and third domestically behind the “double giants” CATL and BYD.
However, amid the severe “involution” in the power battery sector, legal battles over patents between China Innovation Aviation and CATL continue to escalate. Despite being seen as fearless in competing against CATL, China Innovation Aviation’s current scale and market valuation are still significantly behind that of CATL.
Another Hong Kong-listed lithium battery company, Ruipu Lanjun (00666.HK), which was established in 2017 and is part of the world’s largest stainless steel manufacturer and nickel producer, Qingshan Group, recently disclosed its 2024 performance report, marking its first complete annual report after its IPO. The company’s revenue reached ¥17.796 billion, a year-on-year increase of 29.43%, while the net loss narrowed significantly to approximately ¥1.353 billion, from a loss of ¥1.943 billion the previous year. In terms of product breakdown, Ruipu Lanjun’s power battery revenue was ¥7.384 billion, a year-on-year increase of 71.4%, while energy storage battery revenue was ¥7.259 billion, up 3.9%, marking a shift in revenue share towards power batteries at 41.5%. Notably, the gross margin for the power battery segment finally turned positive, rising from -2.6% the previous year to 2.5%, while the energy storage battery gross margin was 5.4%. Overall, the company’s gross margin was 4.1%, which remains relatively low compared to China Innovation Aviation.
In 2024, Ruipu Lanjun sold 43.71 GWh of lithium battery products, a year-on-year increase of 124.4%, with a designed annual production capacity of 74 GWh by the end of last year. The company has also undergone management changes, with FENG TING, the son-in-law of Qingshan Group’s founder, appointed as president last October. FENG TING previously worked at Cinda Securities and Shanghai Sigma High-Tech Co., Ltd. His wife, Xiang Yangyang, currently serves as a non-executive director at Ruipu Lanjun.
As the two Hong Kong-listed lithium battery predecessors report their performance, several domestic peers are also announcing their latest progress in seeking IPOs in Hong Kong. Companies such as Zhengli New Energy, CATL, XianDao Intelligent, Zhongwei Co., Gree, and Jinsheng New Energy are forming a trend towards a full industry chain IPO in Hong Kong, with some seeking an “A+H” layout and others looking to debut in Hong Kong. Among them, CATL, a power battery giant, is a focal point as its Hong Kong IPO is expected to be one of the largest IPO projects in recent years. On February 11, CATL formally submitted its application to the Hong Kong Stock Exchange. Just 25 days later, on March 25, CATL received the overseas issuance listing notice.
On the same day, Zhengli New Energy Battery Technology Co., Ltd. passed the Hong Kong Stock Exchange listing hearing. The company is chaired by CAO FANG, the sister of the “glass king” CAO DEWANG, who, along with the general manager CHEN JICHENG, has previously worked at Fuyao Glass. On March 25, Xiamen Haichen Energy Technology Co., Ltd. also initiated its listing application for the Hong Kong Stock Exchange, planning to list on the main board. The company was founded by WU ZUYU, who left CATL in February 2019 and established Haichen Energy at the end of the same year, previously serving as an engineer at CATL. In 2024, Haichen Energy emerged as a dark horse in the energy storage battery sector, ranking third globally in lithium-ion energy storage battery shipments, following CATL and EVE Energy.
Amid the rush for lithium and other new energy companies to list in Hong Kong, the underlying factors include tightening IPO regulations in the A-share market, declining performance, and urgent financing needs. Additionally, the current trend of “going abroad” is also a significant driving force for companies’ internationalization strategies. CATL, which has no shortage of funds, previously indicated that building and operating overseas factories require significant reserves of euros, dollars, and other foreign currencies. According to publicly disclosed information, as of June 2024, CATL had USD 6.735 billion and EUR 3.858 billion in foreign currency balances, insufficient to cover investments of several billion euros in regions like Europe and ongoing overseas strategic layout requirements. By listing in Hong Kong, CATL believes it can effectively build up foreign exchange reserves to support overseas projects.
This year, China Innovation Aviation announced on February 24 that construction had begun on its base in Portugal, with an investment of approximately €2 billion (around ¥152 billion). The first phase of the base is expected to reach an annual production capacity of 15 GWh, with production slated to begin in 2027. Earlier, on January 9, Ruipu Lanjun disclosed plans to invest in building a battery factory in Indonesia, with an expected annual production capacity of 8 GWh for power and energy storage batteries and components after the first phase is operational, marking its first overseas battery factory. The choice of location in Indonesia is influenced by its “natural advantages,” as Qingshan-related companies established nickel mining operations there over a decade ago.
In 2024, the demand for lithium iron phosphate batteries has surged, with many multinational automakers and domestic and foreign battery manufacturers signing long-term agreements, with most delivery timelines concentrated in this year and next. Last month, Ford signed a five-year supply agreement with CATL to ensure stable supply of lithium iron phosphate batteries, including supercharging batteries, for new models starting in 2026. Previously, Renault signed orders for lithium iron phosphate batteries with LG Energy and CATL, with a total procurement volume reaching 39 GWh between 2025 and 2030, sufficient to meet the needs of 590,000 electric vehicles. Battery manufacturers are also ramping up their procurement of lithium iron phosphate materials. CATL secured an order for lithium iron phosphate from Fulian Precision Engineering, with at least 140,000 tons per year to be supplied by its subsidiary Jiangxi Shenghua during 2025-2027. LG Energy revised an agreement with Longpan Technology‘s Changzhou Lithium Source to increase its procurement from 160,000 tons to 260,000 tons before 2028.
As technology advances and market expansion continues, the demand for lithium iron phosphate is expected to keep growing. Industry analysis indicates a significant increase in demand for fast-charging power batteries, driving rapid iterations of lithium iron phosphate materials, with high-performance lithium iron phosphate products, including high-density and high-rate variants, continuously emerging into the market. Additionally, Chinese lithium iron phosphate manufacturers are accelerating their global布局, expanding their overseas market share, further boosting market demand.
In the world’s largest new energy vehicle market, lithium iron phosphate batteries are continuously consolidating their advantageous position. Industry data shows that in February this year, the total installation volume of power batteries in China was 34.9 GWh, a year-on-year increase of 94.1%. Among them, the installation volume of ternary batteries was 6.4 GWh, a year-on-year decrease of 7.2%, accounting for only 18.5% of total installations, while the installation volume of lithium iron phosphate batteries soared to 28.4 GWh, marking a 158% increase year-on-year, accounting for 81.5% of total installations, setting a historical high.
Furthermore, lithium iron phosphate batteries are not only flourishing in the Chinese market but are also gaining traction among overseas automakers. Companies such as Tesla, Volkswagen, BMW, Mercedes-Benz, Renault, Stellantis, General Motors, and Hyundai are increasingly planning or have already adopted lithium iron phosphate batteries in their models. According to industry estimates, by 2030, the total demand for power and storage batteries in Europe will reach 1500 GWh, with about half, or 750 GWh, expected to adopt the lithium iron phosphate route. Compared to ternary materials, lithium iron phosphate offers higher safety, better economy, and longer lifespan, making it a preferred choice.
Experts suggest that the relatively low cost of lithium iron phosphate batteries effectively reduces production costs for new energy vehicles, making electric vehicle prices more competitive and thus stimulating market demand growth. Additionally, lithium iron phosphate batteries exhibit excellent thermal stability and safety, enhancing consumer confidence in electric vehicle safety. “Considering factors such as economy, safety, and material controllability, lithium iron phosphate batteries will continue to be the mainstream choice in the market for the next 15 years,” predicts Lian Yubo, executive vice president of BYD Group.
Industry forecasts suggest that by 2030, global demand for power batteries will exceed 3500 GWh, with storage batteries’ demand reaching 1200 GWh. In the power battery sector, lithium iron phosphate batteries are expected to account for 45% of the market share, with demand exceeding 1500 GWh. In the storage sector, lithium iron phosphate batteries are projected to surpass an 85% market share, with demand exceeding 1000 GWh, leading to an annual demand of around 10 million tons for lithium iron phosphate materials by 2030.
Chinese manufacturers are seizing the opportunity to expand production capacity in response to this significant market demand. For instance, CATL, which has the most overseas automotive clients among power battery manufacturers, is planning to jointly build a lithium iron phosphate power battery factory in North America with General Motors, with expected production capacity exceeding 35 GWh. Additionally, CATL’s collaboration with Stellantis involves a €4 billion (approximately ¥306 billion) investment to build a 50 GWh lithium iron phosphate battery factory in Spain, with production expected to start in 2026. Meanwhile, EVE Energy, having secured hundreds of GWh in battery orders, has begun construction on a joint venture battery project in Mississippi, with an annual production capacity of approximately 21 GWh for square lithium iron phosphate batteries, expected to commence shipments in 2026. Furthermore, Envision AESC has also started its lithium iron phosphate battery factory in Spain, which is expected to go into operation by 2026.
In terms of material suppliers, Dehong Nano has reached an agreement with Amsterdam Fertilizer to build a lithium iron phosphate battery material factory in Spain. Longpan Technology is jointly investing with the Indonesian Investment Agency to establish a factory with a planned annual production of 120,000 tons of lithium iron phosphate materials in Indonesia. Wanrun New Energy is constructing a lithium iron phosphate production facility in South Carolina, USA, with a planned annual capacity of 50,000 tons. Hunan Youneng is planning to invest in a lithium iron phosphate project in Spain with an annual production capacity of 50,000 tons.
Many companies are also enhancing their technology layouts. Hunan Youneng has announced that its high-pressure, high-density products are highly competitive and is one of the few companies in the industry capable of mass-producing such products. Currently, the company is developing its fifth-generation lithium iron phosphate products. Anda Technology has also announced that its next-generation lithium iron phosphate products are steadily being mass-produced, with increasing shipment volumes and market share. According to Dehong Nano, its liquid-phase method technology can produce high-pressure lithium iron phosphate products, with new high-pressure products already achieving batch shipments, and progress on ultra-high-pressure products is proceeding smoothly. Fulian Precision Engineering has reported that its high-pressure lithium iron phosphate products have been recognized by key customers and leading manufacturers.
From being overshadowed by ternary batteries to a strong comeback, lithium iron phosphate batteries are continuously improving in performance and are expected to increase their share of electric vehicle installations globally. The technological route for lithium iron phosphate batteries is accelerating its globalization, with Chinese companies significantly enhancing their influence in the global supply chain.
On March 19, Zhongna Energy and Maoli Technology established a strategic partnership, further expanding the sodium iron battery ecosystem. Recently, both companies signed an agreement to collaborate in new battery, electricity, and energy applications. They aim to leverage the advantages of sodium iron battery systems in various power storage scenarios, including energy storage in distribution networks, temporary electrical expansion, system frequency modulation, and backup power for base stations, promoting the industrialization of sodium iron energy storage systems. During the collaboration period, Zhongna Energy will supply no less than 4,000 tons of positive electrode material to Maoli Technology for joint development and mass production of GWh-level large-capacity high-rate energy storage cells.
The two parties will also develop power storage systems of various specifications and enter commercial energy storage parks, EV charging and swapping stations, distributed photovoltaic storage, grid-area energy storage, and microgrid energy storage systems, while simultaneously expanding into overseas markets in Europe, North America, and Southeast Asia.
On March 31, Guorun Energy announced that it had secured a patent for a chlorine detection and recovery device for flow batteries, aimed at reducing environmental pollution and safety threats caused by chlorine leakage. The invention, referenced as “A Chlorine Detection and Recovery Device for Flow Batteries,” involves a recovery shell and tank, equipped with a gas pump and a connection system designed to minimize chlorine gas leaks during maintenance and separation processes.
On March 23, Shandong Electric Liquid Storage was awarded the “Best Flow Battery Supplier Award” for 2025 at the 15th China International Energy Storage Conference and Exhibition, recognizing its contributions and innovations in the flow battery sector. The company has committed to developing high-performance, environmentally friendly all-vanadium flow battery solutions, aiming to become a global leader in long-term energy storage system integration.
Finally, the first GWh-level sodium-ion battery production line in Fuyang, Anhui, has started full-load production, marking a significant milestone in the sodium-ion battery industry. The production line, operated by Fuyang Haizhao Technology, has already achieved a daily output of over 10 tons and is expected to fill a key gap in the sodium-ion battery supply chain in the western region. The city aims to develop a comprehensive sodium battery industry cluster by 2030, projecting an industry scale exceeding ¥40 billion.
