After hitting an all-time high of 590,000 yuan/ton at the end of November 2022, the price of battery-grade lithium carbonate fluctuated and fell all the way.The industry believes that, coin cell case:20 The development of our company marks the rapid and steady progress of the whole industry. https://www.canrud.com/products/detail/81f89a31076f4fd18e883ee190d194cd
On January 15th, the data released by Shanghai Steel Union showed that the price of battery-grade lithium carbonate was the same as last time, with an average price of 97,000 yuan/ton.
On January 8, the price of battery-grade lithium carbonate fell below the 100,000 yuan/ton mark.
This is bad news for power battery recycling enterprises. If the price of lithium carbonate is less than 100 thousand yuan per ton, the battery recycling enterprise as a “regular army” will be unprofitable.
About 120,000 enterprises in China have registered the battery recycling business, while only 156 “regular army” enterprises meet the white list of the Ministry of Industry and Information Technology. The “regular army” cannot compete with the small workshops at the C end because of its high investment and low Mao Lijiao. The standardized recovery rate of power batteries for new energy vehicles in China is less than 25%.
However, the traditional wet recycling process is long, polluting and costly, and the laws and regulations on battery recycling in various countries are getting stricter and stricter. Power battery recycling enterprises are fighting a siege battle about technical adjustment and business model.
Regulations and present situation
With the continuous development of new energy vehicles, there is also a gradual increase in the amount of retired power batteries. The life of power batteries is 5-8 years, so it is urgent to solve the problem of recycling retired power batteries.
From the perspective of chemical composition, waste lithium-ion batteries contain substances, electrolytes and their conversion products, which can cause environmental pollution and even personal injury if they enter the ecology.
The recycling of battery materials itself has multiple economic values. After the high-end equipment is retired, lithium batteries can still meet the needs of some low-end electrical appliances and can be used step by step; Even if it is scrapped, it can no longer meet the deeper use, and the relatively rare strategic metals such as lithium, cobalt and nickel contained in it still have regenerative value. In addition, battery material recycling also has economic value in energy consumption.
Japan, the United States and Europe have established relatively perfect rules in legislation and market implementation system.
Japan started early in the recycling of used batteries. Although there is no special legislation on batteries, in the field of environmental protection law, a circular economy legislative system of “Basic Law-Comprehensive Law-Special Law” has been established.
As early as 1994, Japan established a relatively perfect reverse logistics battery recycling system of “battery production-sales-recycling-recycling”. Battery manufacturers independently formulated the recycling scheme of power batteries, and vehicle manufacturers played an important role in recycling used batteries.
The United States mainly legislates from federal, state and local levels to form a complete legal system of battery recycling management. On the market side, the recycling model is based on the extension of producer responsibility and the deposit system, and the battery recycling network is established. At the same time, the waste battery recycling enterprises sell the purified recycled raw materials to battery manufacturers at the agreed price, completing the closed loop of the recycling industry.
After 20 days of publicity, the new EU battery regulation “Battery and Waste Battery Regulation” came into effect on August 17, 2023, and will be enforced on February 18, 2024.
There are many kinds of new battery laws in the European Union. Apart from stipulating who produces and who recycles, it basically sets an “e-passport” with a higher threshold for batteries entering the European market: providing battery carbon footprint statements and labels; Set the minimum recovery rate and material recovery target; Batteries entering the European market need to be affixed with QR codes and digital passports, among which power batteries are explicitly required to have electronic records.
At present, there are no specific indicators for battery recycling in China similar to those in the European Union, but as a programmatic document, the “Fourteenth Five-Year Plan for Industrial Green Development” shows that a relatively complete recycling system for power batteries should be built in 2025. Since 2018, the Ministry of Industry and Information Technology has mainly adopted the method of recycling white-listed enterprises of power batteries, and at present, five batches of enterprises that meet the industrial standard conditions for comprehensive utilization of used power batteries in new energy vehicles have been released; At the same time, the “Management Measures for the Recycling of Power Batteries in New Energy Vehicles” is being accelerated.
With regard to the minimum recovery rate of raw materials, Article 8 of the EU’s Regulation on Batteries and Waste Batteries stipulates that by 2030, the proportion of recycled raw materials such as cobalt, lead, lithium and nickel will reach 12%, 85%, 4% and 4% respectively; By 2035, it will increase to 20%, 85%, 10% and 12%.
Image source: Xu Ming, Vice President of Tsinghua University Institute of Environment.
According to the data of GGII, the scarcity of global resources is expected to further increase after 2035, and the exploitable lithium, cobalt and nickel can only support the demand of that year for 35, 14 and 36 years respectively.
As the core strategic resources of China, lithium, cobalt and nickel are highly dependent on foreign countries.
According to the Global Mining Development Report 2023, in 2022, China’s imports of lithium carbonate, cobalt ore and its concentrate, and nickel ore and its concentrate all ranked first in the world.
Among them, lithium carbonate imports account for 54% of the total global imports, mainly from Chile and Argentina, accounting for 90% and 9% respectively; Imports of cobalt ore sand and its concentrate accounted for 91% of the total global imports, up 38% year-on-year, mainly from Congo (99.9%); Imports of nickel ore and its concentrate accounted for 92% of the total global imports, down 9% year-on-year, mainly from the Philippines (83%).
Many people in the industry interviewed by auto business review said that improving the recycling of power batteries can greatly alleviate the dependence on resource imports.
According to GGII’s forecast, it is estimated that in 2030, the recoverable lithium, cobalt, nickel and manganese resources will account for about 58%, 62%, 70% and 42% of the corresponding demand respectively.
Three major pain points
The aforementioned insiders believe that power battery recycling enterprises face three major pain points: competitive environment, price and technology.
According to the monthly report of power battery decommissioning data released by the secretariat of China New Energy Vehicle Power Battery Recycling Industry Collaborative Development Alliance (CABRCA) on November 20th, 2023, from January to October, 2023, a total of 139,000 tons of decommissioned power batteries were produced nationwide, with a year-on-year increase of 70.9%. Among them, Ferrous lithium phosphate accounts for more than 50%.
After the approval of the fifth batch of white list enterprises of the Ministry of Industry and Information Technology, the number of white list enterprises for battery recycling has reached 156, with the planned construction capacity of 9.875 million tons of waste power lithium batteries and the capacity of 4.692 million tons approved by the EIA.
Compared with the planning capacity of 9.875 million tons of “regular army” on the white list, the amount of decommissioned batteries of more than 100,000 tons is too small to eat at all, and there are many low-priced “small workshops” vying for supplies.
According to auto business review’s understanding, the players of power battery recycling enterprises generally include two categories, one is the waste end of the factory, including the main engine factory, battery factory and automobile disassembly factory, and the other is the C end, which is large and scattered. Most of the small workshops come from the C end.
According to the data of Fu Bao Metal Network, there are about 120,000 enterprises registered as “battery recycling” in China. According to the survey report of the State Council Development Research Center, by 2023, the standardized recovery rate of power batteries for new energy vehicles in China is less than 25%.
There are two main disposal methods for decommissioned power batteries. One is step-by-step utilization. The decommissioned power lithium battery is used as a carrier of electric energy in other fields, so as to give full play to the residual value, mainly by disassembling, screening and reorganizing the battery packs with degraded performance that do not meet the standards of power batteries, and finally integrating the system. Then it is used in some fields that do not require high energy density, mostly in unmanned forklifts and AGVs, low-speed electric vehicles, and user-side energy storage power stations. Companies such as BMW have taken the lead in testing and laying out these ladder utilization scenarios.
