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China'sShanshan to build Li-ion battery anode plant

Published date: 04 August2021

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Chinese lithium-ion battery material manufacturer ShanghaiShanshan, a subsidiary of domestic diversified new energy firm Ningbo Shanshan,is on track to build a production facility for anode material in Meishan cityin southwest China's Sichuan province.

The 8bn yuan ($1.2bn) project has a designed capacity of200,000 t/yr for anode material used in lithium-ion batteries. It will bedeveloped in two phases, each with 100,000 t/yr of capacity. Site constructionwill take 16 months for each phase, although it is unclear when it will begin.

Sichuan is a major production area for lithium-ion batteriesand so is a hub for downstream consumers of anode material. The province isrich in hydropower resources and provides preferential electricity prices toproducers. The new plant will take advantage of Sichuan's position as a keystarting station of the China-Europe freight railway to ship to Europeanbuyers.

Shanshan began building the second phase of itsInner-Mongolia production plant, with a designed capacity of 60,000 t/yr foranode material and 52,000 t/yr for graphite processing, in April. Constructionis expected to be completed within 15 months. The first production phase of60,000 t/yr for graphite negative material and 40,000 t/yr for carbon-coatedgraphite negative materials was launched in August 2019.

Shanshan produced 61,399t of anode material last year, up by 31.34pc from 2019, with sales rising by 24.5pc to 58,977t.

Domestic prices for 94pc grade graphite flake, a mainfeedstock for anode material, were assessed at Yn3,100-4,100/t ex-worksyesterday in line with firm demand from the downstream lithium-ion battery andsteel industries.

Demand for lithium-ion batteries and its feedstock isexpected to remain robust in response to sustained growth from the new energyvehicle (NEV) and energy storage sectors.

China has been accelerating development of NEVs to achieveits carbon-neutral targets by 2060. Beijing has extended government subsidieson NEVs for two years to the end of 2022 and exempted the purchase tax on NEVsfor 2021 and 2022. The country's production and sales of power batteries andNEVs both hit new highs during January-June, supported by government stimuluspolicies.

Total output of power batteries rose to 74.7GWh duringJanuary-June, up by 217.5pc from a year earlier, with installed volumesincreasing by 200.3pc to 52.5GWh over the same period, according to data fromthe China Automotive Manufacturers Association (CAAM).

China's NEV output rose to 1.215mn in the first half of2021, up by 200.6pc from the previous year. Sales increased by 201.5pc to1.206mn units, the same level as for all of 2019, according to the CAAM data.