Power Batteries Will Contribute To The Main Incremental Demand For Cobalt In The Future

- Mar 08, 2017 -

High energy density battery application trend. From the domestic point of view, in December 30, 2016, the Ministry of industry and other four ministries jointly issued on the promotion of new energy vehicles to promote the application of financial subsidies notice. In the new version of the subsidy notification, various models of the subsidy policy will be used as an important reference index of energy density of batteries, the future of the vehicle battery energy density must reach a certain threshold requirements, and encourage high density battery applications, resolutely eliminate low-end batteries. From abroad situation, the proportion of three yuan battery application is higher, Tesla, TOYOTA, Ford, Volkswagen, Daimler and other mainstream manufacturers have used a $three battery.          

Currently on the market most of the lithium iron phosphate battery system energy density level of about 70-90Wh/kg, the future can be achieved through the improvement of the material threshold requirements of 90Wh/kg, but there are still some difficulties to exceed 120Wh/kg. The three yuan battery energy density has reached more than 90Wh/kg, high density of three yuan battery can reach more than 120Wh/kg (such as the use of nickel cobalt aluminum battery Tesla ModelS, its energy density of 170Wh/kg). Under the guidance of the policy, the future high-density three yuan battery nickel cobalt manganese and nickel cobalt aluminum will become the mainstream.          

In January 2017 23 the Ministry announced in 2017 the first batch of "recommended the promotion and application of new energy vehicle models directory", the statement in 2016 for the first batch of recommended models directory of all the void 1-5. The first installment of the new directory of the application of a total of three yuan battery electric car models, accounting for the proportion of the total proportion of pure electric vehicles up to 50%. Sub models, pure electric passenger cars, special vehicles in the application of three yuan battery models were 66% and 61%, respectively, pure electric buses have not been used in the battery of $three.          

The new national standard and the first batch of catalog models reflect the important position of three yuan battery in the field of power batteries, the next volume can be expected. We think that the new national standard to launch up starting from the supply side, in order to enhance the threshold of technology to promote the development of the industry, the future high energy density batteries will be the mainstream application, compared with the lithium iron phosphate battery, three yuan obvious advantage in this respect. After the introduction of the country's first batch of recommended catalog models, three yuan battery reflects the current industrial chain with the technology and peatlands basis, as well as the positive response of downstream manufacturers. We judge in the field of passenger cars and special vehicles, three yuan battery will be expected to fast peatlands.          

Expected in 2017 -2020, China and foreign three material cobalt demand will be an average annual growth rate of 70%, 50% compound. From the domestic point of view, we expect 2017 domestic production and sales of new energy vehicles will reach 700 thousand, of which passenger cars for the 500 thousand, dedicated vehicles and buses are all in the year of 2020, will reach 2 million in. In the rapid development of the industry trend, the upper reaches of the industry chain will also be fast peatlands, three yuan battery will not only enjoy the high growth of the industry, will also increase the proportion of the application of the excess growth rate. According to our estimates, in 2017 -2020 years, the domestic demand for cobalt battery three yuan of material will be an average annual growth rate of compound growth of 70%. From abroad, we expect 2017 -2020 new energy vehicle production and sales will be 33% annual compound growth rate, the average annual compound growth rate of $three material cobalt demand will reach 50%.