NCM cathode material market has huge market space but faces greater competitive pressure

Cathode materials account for the highest cost in lithium-ion batteries, reaching about 40%, and the performance of cathode materials directly affects the energy density, cycle life and safety of lithium-ion batteries and plays an important role. Compared with other cathode materials, ternary cathode materials have obvious advantages in specific energy and specific power, and have become a mainstream product type. Among the ternary cathode materials, my country mainly uses NCM. The NCM cathode material is composed of three materials: nickel (Ni), cobalt (Co), and manganese (Mn) in a certain proportion.

According to the “China NCM Cathode Material Industry Market Supply and Demand Research Consultation Report 2021-2025” released by the Industrial Research Center, in NCM cathode Among materials, nickel has a great impact on the energy density of the battery, cobalt has a great impact on the cycle performance of the battery, and manganese has a great impact on the safety of the battery. New energy vehicles have become an important trend in the development of the automobile industry. The scale of electric vehicle production continues to expand. In order to improve the endurance of power batteries, the market’s energy density requirements for cathode materials continue to increase. Therefore, the demand for high-nickel NCM cathode materials is rising rapidly. At the same time, the demand for cobalt in high-nickel NCM cathode materials has declined. Against the backdrop of global cobalt prices continuing to rise in 2021, the cost advantage of high-nickel NCM cathode materials has become increasingly prominent.

Divided according to the different proportions of nickel, cobalt and manganese, NCM cathode materials mainly include NCM523, NCM622, NCM811 and other product types. NCM811, which contains 80%, 10% and 10% nickel, cobalt and manganese respectively, is a high-nickel NCM cathode material. It has become an important development direction of power battery cathode materials and has attracted the attention of many companies in my country. In addition, in order to further improve the battery energy density, in August 2020, South Korea’s SKI commercialized the world’s first NCM battery with a nickel content of 90%.

my country is the world’s largest producer of ternary cathode materials. In 2019, its output exceeded 190,000 tons, accounting for more than 55% of the global total output. From January to September 2021, my country’s power battery installed capacity exceeded 82GWh, of which ternary battery installed capacity accounted for 58%. From this point of view, my country’s NCM cathode materials have a broad market space. However, when NCM cathode materials are highly nickel-based, their safety has declined. Due to its cost and safety advantages, my country’s lithium iron phosphate battery demand will grow more strongly in 2021. Benefiting from the energy density advantage, the demand for NCM cathode materials is also growing rapidly, but it is slower than lithium iron phosphate cathode materials.

In addition to NCM, ternary cathode materials also include NCA. Compared with NCM, NCA has a shorter cycle life, but its life is not easy to decay when left for a long time, and its energy density is higher. Some Tesla models use NCA batteries. Generally speaking, NCM cathode materials have a broad market space in the future, but they also face competition from lithium iron phosphate cathode materials and NCA cathode materials. Improving energy density, safety, and lifespan are still the focus of industry development. Industry analysts said that in the Chinese market, the main NCM cathode material manufacturers include Shanshan Co., Ltd., Dangsheng Technology, and Xiamen Tungsten Industry, Sinochem International, Rongbai Technology, Tianyuan Group, Fengyuan Holdings, etc.