Ganfeng Lithium and SVOLT, a power battery manufacturer, announced on Wednesday that they have signed a strategic cooperation framework agreement to carry out in-depth collaboration involving lithium resources, lithium salt supply and sales, battery recycling and industrial park construction.
According to the agreement, both parties will plan a lithium battery full-chain eco-industrial park project in Shangrao, Jiangxi Province, led by SVOLT with additional participation from Ganfeng Lithium. Correspondingly, SVOLT has reached a framework agreement with the Shangrao Municipal Government to position the industrial park, which will be laid out from the energy side, covering new energy enterprises from the upstream mine side, to lithium batteries, and then to energy storage and other market applications. Previously, SVOLT planned to build intelligent manufacturing industrial parks and zero-carbon industrial parks in Changzhou, Jiangsu Province and Dazhou, Sichuan Province respectively.
Since last year, the price of upstream lithium salt products such as lithium carbonate has risen sharply due to a shortage of supply, which once exceeded 500,000 yuan/ton ($74,685/ton) in Q1 of this year. Under these cost pressures, the profits of enterprises in middle and lower reaches represented by power batteries are under pressure, which has triggered a heated discussion in the industry on the ecology of the lithium battery supply chain.
Ganfeng Lithium, as a major global supplier of lithium salt, has customers such as Tesla, LG Chem, BMW, Umicore, and more. The designed production capacity is 43,000 tons/year for lithium carbonate, 81,000 tons/year for lithium hydroxide, and 2,150 tons/year for lithium metal. At present, it has production capacity layout in Xinyu, Ningdu and Shangrao.
Developed from the Battery Unit of Great Wall Motors, SVOLT has set a global capacity target of 600 GWh in 2025, with a market share target of 25%. In Q1 of this year, the installed capacity was 1.3 GWh, a year-on-year increase of 137.5%, with a global market share of 1.3%.
In addition to the supply and sales of lithium resources, the strategic cooperation between the two parties also extends to the field of power battery recycling. In Ganfeng Lithium’s view, recycling lithium is profitable and can be developed in the long run, and the company is also accelerating its layout in recycling network and business segments.