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Analysis by Taipei-based intelligence provider TrendForce concludes that the average price of lithium iron phosphate (LFP) energy storage system cells continued to decline in August, to 0.35 yuan/Wh ($0.049/Wh). Meanwhile, demand for large-capacity cells continued to grow at a steady pace.
As raw material prices continue to fall, battery cell costs face downward pressure.
Following a drop in the price of battery-grade lithium carbonate to below 90,000 yuan/tonne ($12,654/tonne) in July, August marked a new record low by falling further below 80,000 yuan/tonne, according to market analyst TrendForce.
The continued decline in cobalt and nickel salts also led to declines in prices for cathodes, electrolytes and other battery components.
Meanwhile, demand for grid-scale energy storage system batteries continued to improve in August, driving sustained order growth for 314 Ah. Analysts noted that the trend toward higher-capacity batteries continues and prices continue to decline. The average selling price (ASP) of lithium iron phosphate (LFP) batteries fell to 0.35 yuan/Wh in August, down 6% month-on-month.
EV battery prices decreased by 4% month-on-month, with the average price of LFP square batteries falling below 0.4 yuan/Wh, while that of ternary square and bagged ternary EV batteries were 0.46 yuan/Wh and 0.48 yuan/Wh, respectively.
Although the lithium oversupply is unlikely to reverse, and the long-term trend in lithium carbonate prices will remain downward, a modest, short-term rebound in lithium salt prices can be expected in the coming period with the arrival of the traditional peak season (September-October). This is expected to trigger increased stockpiling activity following a period of destocking across the supply chain.
According to TrendForce, cathode and battery cell manufacturers are revising their production plans upwards as midstream demand shows signs of recovery.
However, uncertainty remains in the Chinese NEV sector, which faces trade risks from tariffs in overseas markets such as the US, Canada and Europe. The US was initially planning to impose a 100% tariff on EVs made in China from 1 August, but this move has been postponed. Canada plans to follow suit with a similar 100% tariff on EVs made in China, which will take effect on 1 October.
TrendForce believes that given these uncertainties surrounding international tariff policies, battery manufacturers may start stocking up as lithium prices approach their lows. |
