The production data of the lithium battery industry in October once again exceeded expectations, continuing to rise on the basis of the high base in September, and the supply and demand turning point is established under the resonance of the peak season and energy storage outbreak.

The industrial logic is shifting from passive clearing of production capacity to active replenishment of inventory and competition for high-quality production capacity. The operation of the industry is driving lithium batteries to enter a rhythmic upward trend.

Based on comprehensive data from multiple sources, battery production rose at a high level in October, with a 10% increase compared to the high level in September. The battery production of the top 20 battery factories has increased by over 20% month on month, with energy storage cells accounting for more than 40%.

The industry average operating rate is close to 90%, with top manufacturers operating at full capacity, and the utilization rate of second tier factories rapidly recovering.

Looking at each stage, the positive electrode has a month on month increase of 0.7%; Negative electrode month on month+5.8%; Diaphragm month on month+4.3%; The electrolyte has a month on month increase of 4.2%.

Energy storage has become the variable with the strongest marginal pull.

As of January to August, the scale of domestic energy storage bidding has exceeded 270GWh, nearly doubling year-on-year. Most of them will be implemented by the end of 2024 to the beginning of 2025, and the October bidding and delivery of projects will significantly increase the demand for production scheduling.

The overseas market also performed well. The United States added 27.65 GWh of energy storage capacity from January to August, doubling year-on-year; Starting to replenish orders after experiencing destocking in Europe; Blooming in multiple locations in the Middle East, Latin America, and Southeast Asia.

Meanwhile, the sales of new energy heavy-duty trucks in China exceeded 100000 units from January to August, a year-on-year increase of over 180%. The strong growth rate has driven up the charged capacity of bicycles, becoming another growth pole for driving the installation of power batteries.

With the continuous tightening of battery cell production capacity catalyzed by the two major demands of power and energy storage, the bargaining power and production capacity discourse power of top enterprises will be enhanced.

On the supply side, energy storage battery cells are in high demand. CCTV Finance reported that with the combination of domestic and international demand, the new energy storage market is "hard to find a single chip", and many leading battery factories have stated that their production lines are at full capacity.

The top battery cell factories are at full capacity, and there are also overtime and OEM expansion in the second and third lines. If new production capacity cannot be quickly implemented, the tense situation may continue until mid-2026.

In the lithium battery material sector, lithium hexafluorophosphate drives a chain reaction of price increase. At present, the price of lithium hexafluorophosphate has exceeded the 60000 yuan/ton mark, and the electrolyte has been driven by 6F to rise comprehensively. Most enterprises are close to full production, and the price difference between individual and long-term orders has increased.

In September, Ruipu Lanjun purchased a total of no less than 800000 tons of electrolyte products from Jiujiang Tianci, with the agreement taking effect until 2030. In July of this year, Chu Neng New Energy also signed an agreement with Tianci Materials, with a total volume of no less than 550000 tons from the signing of the agreement until 2030.

In terms of iron and lithium, the shortage of supply has led to battery companies locking in orders by 2026, and there are signs of "pressure relief" from customers paying to expand production and improve payment methods.

However, another viewpoint suggests that the supply-demand gap for iron and lithium has narrowed from 20% to around 10%. Leading enterprises still have strong bargaining power based on new products and high-pressure specifications, but the overall price level is difficult to see a general increase.

The diaphragm section exhibits structural differences. Top enterprises have already raised their prices for energy storage specifications and coating products by about 10%, but due to overcapacity in the second and third tiers, the conditions for a general price increase across the industry are not met.

The negative electrode and copper foil as a whole are still under production capacity pressure, but the supply and demand of high-end segmented products such as ultra-thin copper foil and silicon carbon negative electrode are improving, and there is also some room for processing costs to increase.

After the cost pressure of material price increases is transmitted to the battery cells, there is a differentiation in the transaction prices of downstream energy storage products.

The price of household energy storage has risen the most significantly, with an average increase of about 0.44 yuan per watt hour; The increase in bulk storage orders is controlled at 0.02 yuan per watt hour; The negotiation adjustment for long-term contracts is relatively mild, about 0.01 yuan per watt hour.

In the short term, the industry is expected to maintain high prosperity from November to December, and the "off-season" is expected to continue in the first quarter of next year, with limited month on month decline in production scheduling.

The industry is entering a new proactive upward cycle. The market is revising up its expectations for the growth rate of the lithium battery industry chain in 2026, especially the energy storage sector, which is expected to continue to exceed expectations and experience explosive growth.

On the demand side, the traditional peak season and energy storage outbreak form a synergy; On the supply side, the top factories are operating at full capacity and some materials are experiencing shortages, driving price recovery.

Overall, the industry has moved from the destocking stage to the active replenishment stage, and the focus of competition is gradually shifting towards the competition for high-quality production capacity and key resources. For industrial chain enterprises, energy storage specification battery cells, as well as materials such as lithium hexafluorophosphate, electrolytes, and energy storage separators, are becoming new high points of value.