Development analysis of lithium battery copper foil industry

Lithium battery copper foil is the main material of the current collector of the lithium battery negative electrode material, and its function is to collect the current generated by the battery active material in order to output a larger current. The production process, cost and performance of lithium batteries are closely related to the performance of lithium battery copper foils used as current collectors. Lithium battery copper foil has become the first choice for lithium battery negative current collectors due to its good electrical conductivity, soft texture, mature manufacturing technology, and outstanding cost advantages.

1. Lithium battery copper foil is the fastest growing field in electrolytic copper foil

Electrolytic copper foil is an irreplaceable basic material in the modern electronics industry. It is called a neural network for signal and power transmission and communication in electronic products. According to different application fields, electrolytic copper foil can be divided into electronic circuit copper foil applied to printed circuit boards and lithium battery copper foil applied to lithium batteries. According to the thickness of copper foil, it can be divided into ultra-thin copper foil (≤6μm), ultra-thin copper foil (6-12μm), thin copper foil (12-18μm), conventional copper foil (18-70μm) and thick copper foil (>70μm).

According to different surface conditions, it can be divided into double-sided smooth copper foil, double-sided wool copper foil, double-sided treated copper foil, single-sided wool copper foil and low-profile copper foil (RTF copper foil, VLP copper foil, HVLP copper foil), etc. The global total output of electrolytic copper foil, electronic circuit copper foil, and lithium battery copper foil have basically shown a growth trend. Among them, lithium battery copper foil has become the main driving force driving the demand of the copper foil industry. Benefiting from the rapid growth of global new energy vehicle sales, the demand for lithium battery copper foil has increased rapidly.

2. Overview of the global lithium battery copper foil market

In recent years, under the strong support and promotion of the policies of China, the United States, Europe, Japan, South Korea and other countries and regions, the rapid development of the new energy vehicle industry has driven the continuous and rapid growth of the market demand for power lithium batteries. You can learn more about car batteries by reading articles related to car power batteries, such as how many volts is a car battery, car battery recycling, car battery industry, etc.

At the same time, the continuous and steady growth of the 3C digital field and the initial development of the trillion-scale energy storage market have promoted the rapid development of the global lithium battery market. With the stable development of the global digital product market, lithium batteries are widely used in energy storage, superimposing the overall positive trend of the global electric vehicle market, and the global lithium battery market will still maintain a medium-to-high growth trend in the next few years.

It is estimated that global lithium battery shipments are expected to reach 1523 GWh by 2025. Lithium battery copper foil is an important component of lithium battery. Driven by the rapid growth of the global lithium battery market, the demand for lithium battery copper foil also maintains a steady growth trend. According to statistics, the global lithium battery copper foil shipments reached 170,000 tons in 2019, a year-on-year increase of 16.4%, which is comparable to the global lithium battery shipment growth rate in the same period.

In 2020, although the copper foil industry was affected by the new crown pneumonia epidemic, with the gradual control of the epidemic and the rapid development of the global new energy vehicle market, the shipment of lithium battery copper foil increased by 32.4% year-on-year to 225,000 tons. It is estimated that in the next five years, driven by the growth of the global lithium battery market, the global lithium battery copper foil market is expected to continue the high growth trend in the previous period. By 2025, the shipment of lithium battery copper foil will reach 970,000 tons.

3. Overview of China's lithium battery copper foil market

The lithium battery industry is the intersection of the three major industries of new energy, electric vehicles, and new materials. It is one of the strategic emerging industries that China is developing at this stage. A number of Chinese policies have been introduced to encourage the development of lithium batteries and their key materials industries. Driven by policy guidance and market demand, China's lithium battery industry developed rapidly from 2015 to 2018, and the growth rate of market shipments was above 25%.

In 2018, China's lithium battery shipments reached 102.0GWh, accounting for 52.3% of the global market. China has become the country with the largest lithium battery shipments in the world. In 2020, with the introduction of a number of support and incentive policies, China's lithium battery shipments increased accordingly, reaching 143GWh, a year-on-year increase of 21.2%.

In the next few years, benefiting from the policy requirements for the proportion of new energy vehicle sales, the expansion of the digital lithium battery market and the energy storage and small power battery markets, the overall market situation will improve, and the overall market growth rate will reach 37.3% in the next five years. It is expected that China's lithium battery shipments will reach 698GWh by 2025.

With the rapid development of China's lithium batteries, especially power batteries, China's lithium battery copper foil industry continued to develop rapidly at an annual growth rate of more than 25% from 2015 to 2018. In the first half of 2021, the monthly shipments of lithium battery copper foil continued the growth trend in the fourth quarter of 2020. In the future, driven by the rapid growth of the lithium battery market, China's lithium battery copper foil companies will maintain a rapid growth trend. It is expected that China's lithium battery copper foil shipments will reach 630,000 tons by 2025.

From the perspective of subdivided application fields, the power battery market is still the main driving factor for the high growth of China's lithium battery copper foil market. In 2020, the shipment of lithium battery copper foil for power batteries will be 74,000 tons. It accounts for more than 50% of China's lithium battery copper foil. It is estimated that by 2025, China's power battery shipments will exceed 545GWh, and the demand for lithium battery copper foil for power batteries will exceed 512,000 tons, becoming the main growth point of China's lithium battery copper foil market.

4. Technical specifications of lithium battery copper foil

With the development of miniaturization and cutting-edge electronic products, and new energy vehicles put forward higher requirements for power endurance and safety performance. The lithium-ion battery products are also developing towards high capacity, high density and high speed, and the requirements for battery materials are also increasing. High-performance lithium battery copper foil is on the horizon, and the overall technical performance is improved, including but not limited to copper foil apparent quality, physical properties, stability and uniformity, which are closely related to battery performance.

• Thickness: affects battery energy density. The thinner the thickness, the higher the energy density.
• Tensile strength and elongation: affect the yield, battery capacity, internal resistance and cycle life of anode production.
• Surface roughness (profile): affects battery internal resistance and cycle life, etc.
• Thickness uniformity: affects battery consistency, stability and capacity.
• Surface quality of copper foil: If there are defects on the surface of copper foil, the adhesion of the anode material on the copper foil will decrease.
• Oxidation resistance and corrosion resistance: affect conductivity, etc.
• Porosity: affects the adhesion of the negative electrode active material on the surface of the copper foil.

5. Lithium battery copper foil industry chain and market pattern

● Upstream end of the industrial chain

Copper is the most important raw material of lithium battery copper foil, and the price change of raw material copper directly affects the price trend of lithium battery copper foil. The raw materials of copper foil are mainly copper wire and a small amount of sulfuric acid, gelatin and BTA, and the direct copper material accounts for 79% of the product cost. Therefore, the current high price of bulk copper has directly led to a significant increase in the price of copper foil.

● Midstream end of the industrial chain

Copper foil manufacturers all adopt the pricing model of "copper price + processing fee", and manufacturers who take the lead in realizing ultra-thin copper foil production enjoy the technical premium of processing fees.

● Downstream of the industrial chain

Downstream participants are lithium battery companies in the world, such as CATL, GOTION Hi-Tech, and CALB. According to the use, lithium batteries can be divided into power batteries, 3C consumer batteries and energy storage lithium batteries.

6. Lithium battery copper foil industry development trend

● 6μm and below lithium battery copper foil has become the focus of mainstream companies layout

High-energy density lithium batteries have become the focus of the layout of lithium battery manufacturers. These companies can improve the energy density of lithium batteries by replacing conventional battery materials with new lithium battery materials such as high nickel ternary materials, silicon-based anode materials, ultra-thin lithium battery copper foil, carbon nanotubes and other new conductive agents. At present, China's lithium battery copper foil is mainly 6-8μm, and China's mainstream battery factories are also actively introducing 6μm lithium battery copper foil.

In 2020, the domestic penetration rate of ultra-thin copper foil will reach 50.4%, an increase of 11.85 percentage points from 2019. On the premise of ensuring the safe use of batteries, in order to further improve the energy density of lithium batteries, thinner 4.5μm copper foil has become the focus of the layout of China's mainstream lithium battery copper foil manufacturers. With the gradual maturity of the industrialization technology of 4.5μm copper foil and the gradual improvement of the application technology of battery enterprises, the application of 4.5μm lithium battery copper foil will gradually increase.

● China extends new energy vehicle support policy, industry growth is expected to remain

With the development of the industry and economic situation, China has increased its support for the new energy vehicle industry in 2020, and the downstream market is expected to develop steadily. By extending the subsidy period, slowing down the intensity and pace of the subsidy decline, and increasing the government's purchase of new energy vehicles, the period of China's preferential policies for the new energy vehicle industry has been extended. At the same time, the ban on the sale of fuel vehicles in some European countries has also laid a good foundation for the development of new energy vehicles.

In addition, it is expected that in the coming years, the new energy vehicle market will gradually change from policy-driven to market-driven, and the cost of power battery companies needs to be further reduced. It is necessary to expand the scale of production capacity, improve the scale effect, reduce product costs, and improve the market competitiveness of enterprises. Benefiting from the growth in demand for new energy vehicles and the expansion of production capacity, the production and sales volume of the lithium battery copper foil industry is expected to maintain a steady growth trend.

7. Conclusion

Lithium battery copper foil is a very important link in the upstream materials of the electric vehicle industry chain. Benefiting from the rapid growth of the electric vehicle industry, lithium battery copper foil has also ushered in an industry outbreak. In the global production capacity of lithium battery copper foil, Chinese companies account for more than half of the market share, and a large number of them are supplied to leading global power battery companies such as CATL, LG, SK, and BYD.

With the development of extremely thin lithium battery copper foil, the gross profit margin of leading copper foil companies with leading technological strength has been improved, which will inevitably increase their industry competitiveness and premium rate in the capital market.

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