Electrolyte Weekly Report │ The price of lithium hexafluorophosphate is unlikely to rise significantly! Hydrofluoric acid prices approach record highs!

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Introduction: The rise in the price of lithium hexafluorophosphate triggered by the current increase in raw material costs and insufficient production capacity in the mybattery sector will not be very significant, nor will it last for a long time. [Editor’s Note] The Electrolyte Weekly is a weekly newsletter on electrolyte-related topics, jointly launched by Battery Network (WeChat ID: mybattery) and a well-known domestic enterprise—the Beijing Institute of Chemical Technology (WeChat ID: gh_fdee75641b88). It is published every Tuesday as part of the “Battery Think Tank” series. The aim is to provide the industry with more objective insights and analyses through valuable data, reports, and information, offering manufacturing firms different perspectives and ways of thinking. Additionally, we will carry out in-depth research and facilitate project collaborations based on the needs of readers, the industry, and various companies, while introducing advanced foreign technologies and appropriate capital to accelerate the commercialization of China’s electrolyte industry. Furthermore, exploring the collaboration with enterprises or institutions to create content also helps to meet the needs of companies, the market, and users to a greater extent. We look forward to your attention, participation, and support! Editorial Office of Battery Network, Beijing Institute of Chemical Technology, December 4, 2018: https://mpt.135editor.com/mmbiz_png/5Nvhw2wpRImHicOp3oGX6SIxQvNiaJmxGfz1Grc9HH8MY8fXVw11GGjtINhvTeQnTEVDW1DHEx71jFTpLdESFzgw/640?wx_fmt=png 【Market】Hydrofluoric acid prices are approaching historical highs; the prices of fluorite continue to break new records, which benefits the downstream fluorine chemical industry. Since late September this year, the price of hydrofluoric acid in China has risen continuously due to increasing costs of raw materials, and it has now approached the historical high of 15,000 yuan per ton. As a high-end hydrofluoric acid product, electronic-grade hydrofluoric acid is even more expensive. “From late September to mid-to-late November 2018, the price of hydrofluoric acid in China continued to rise, going from around 10,700 yuan per ton to about 14,700 yuan per ton, an increase of 40%. ”Speaking about the recent situation in China’s hydrofluoric acid market, Chen Ling, an analyst at Business Society, said that in February this year, the price of hydrofluoric acid in China reached 15,400 yuan per ton, marking a record high since monitoring began. Thereafter, the price of this product dropped to around 9,000 yuan per ton, but as the price of the raw material fluorite increased, the high price of hydrofluoric acid returned. She said that currently, in some areas, the price of hydrofluoric acid offered by manufacturers has exceeded 15,000 yuan per ton, while most manufacturers are quoting prices around 14,500 to 15,000 yuan per ton. The most important factor driving this round of price increases is that fluorspar prices have continuously hit new historical highs. (Source: Securities Times) [Market] Domestic hydrofluoric acid prices rose in November. According to statistics, the price of hydrofluoric acid in China continued to increase in November; by the end of the month, the price was 14,846.67 yuan per ton, up 3.01% from the initial price of 14,413.33 yuan per ton, representing a year-on-year increase of 24.48%. In November, the price of hydrofluoric acid continued to rise, primarily due to the cost pressures in the raw material market. Additionally, the domestic hydrofluoric acid market is affected by environmental regulations; the overall operating rate of production facilities is around 60%. Companies report that the supply of spot hydrofluoric acid is somewhat tight at present, and the ex-factory prices of hydrofluoric acid produced by these companies keep rising. Currently, the prevailing negotiation price for hydrofluoric acid in the southern region is around 14,500–15,500 yuan per ton, while in the northern region the price ranges from 14,500 to 15,000 yuan per ton. (Source: Business Society) [Company] Jiangsu Guotai: Progress on the electrolyte project in Poland. On November 22, during an interaction with investors, Jiangsu Guotai revealed that it plans to invest in constructing a lithium-ion battery electrolyte production facility in Poland, with a capacity of 40,000 tons per year. Currently, the company is in the process of obtaining the necessary environmental permits in Poland and carrying out preliminary preparations for the project’s construction. Public records show that on December 26, 2017, Jiangsu Guotai issued a announcement stating that the company planned to invest in Poland to build a lithium-ion battery electrolyte production facility with an annual capacity of 40,000 tons; the total investment for this project was 300 million yuan. The project covers an area of approximately 96 mu, with a construction period of about 30 months. The announcement states that Jiangsu Guotai intends for its wholly-owned subsidiary Ruitai New Energy and its holding subsidiary Huarong Chemical to each contribute 50% of the capital required to establish a subsidiary in the Republic of Poland, named temporarily “Guotai Huarong (Poland) Co., Ltd.”. This subsidiary will be responsible for implementing a lithium-ion battery electrolyte production project with an annual capacity of 40,000 tons in Poland. The total investment for this project is 300 million yuan; Ruitai New Energy will contribute 150 million yuan using funds raised through fundraising, while Huarong Chemical will contribute 150 million yuan using its own funds. Both parties will make their contributions in phases, depending on the progress of the project. (Source: Battery 100 Association – Battery Network) https://mpt.135editor.com/mmbiz_png/5Nvhw2wpRImHicOp3oGX6SIxQvNiaJmxGffpHXngTS5P1Ent1sBiat3yfaHvVAGXS9y4LzTbw33kNHnVgQmGxI30Q/640?wx_fmt=png [Opinion] Xinzhoubang: Excess supply of lithium hexafluorophosphate in the global market. Zhao Zhiming, the board secretary of Xinzhoubang (300037), revealed in recent interactions with investors that the slight increase in the price of lithium hexafluorophosphate is mainly due to rising prices of hydrofluoric acid, which in turn increases its costs. In my opinion, in the long term, the price of lithium hexafluorophosphate will be determined primarily by the balance between supply and demand in the market. Data shows that there is currently an ample supply of lithium hexafluorophosphate; with production capacity far exceeding demand, prices are not likely to rise significantly ； Looking back at the market supply and demand for lithium hexafluorophosphate from 2015 to 2017: during 2015 and 2016, there was a shortage of production capacity in the overall market for this substance, which led to a significant increase in its prices. In 2017, an increase in global production capacity caused prices to decline. This year, the surplus supply in the global market for lithium hexafluorophosphate has become even more pronounced, resulting in intense price competition and prices that are close to the break-even point. (Source: Battery 100 Association – Battery Network) https://mpt.135editor.com/mmbiz_jpg/5Nvhw2wpRImHicOp3oGX6SIxQvNiaJmxGfkLtUh5xlUPk3zsrRsVkHnic3g6XvB63N2teTAqVkmkqD3ib3rz1oa7jQ/640?wx_fmt=jpeg 【Think Tank Insights】Prices of lithium hexafluorophosphate are unlikely to rise significantly. Recently, the prices of mainstream electrolyte products have gradually stabilized, and corporate performance has improved. The price of lithium hexafluorophosphate has risen slightly, with the prevailing price being around 95,000 yuan per ton. This increase is mainly due to the ongoing rise in the price of hydrofluoric acid in China in November, as well as the halt in the decline in lithium carbonate prices; rising costs of raw materials have led to a slight increase in the price of lithium hexafluorophosphate. Furthermore, the oversupply in the market since the beginning of the year has led to low enthusiasm among companies to resume operations, which in turn affects the price of lithium hexafluorophosphate. In my opinion, the rise in the price of lithium hexafluorophosphate caused by this wave of increases in raw material costs and insufficient production capacity will not be very significant, nor will it last for a long time. (Commentator: Yu Qingjiao, President of the Battery 100 Association) Editing | Guan Guan