If you are bitten by a K battery, be sure to hold on until ‘this time’.
The current cathode material price rose from $49.6 per kg in the third quarter of 2022 to $50.3 per kg in the second quarter of 2023, and then fell to $42.8 in the third quarter of 2023. This will recover as lithium prices rise.
The decline in mineral prices continues for part of the fourth quarter, so the third and fourth quarters are bad, but they will explode next year. So, it would be a good idea to use now as an opportunity to buy. However, as there is a sense of uncertainty due to war, etc., we recommend purchasing in installments.
56.89 million electric vehicles will be sold
Depending on the forecast for electric vehicle sales in 2030, the forecast size of the battery and cathode materials market will vary. Samsung Securities estimated sales of electric vehicles, including hybrid vehicles, to be 39.9 million units in 2030.
'Wang Qing China State Council Development Research Center Market Economy Research Institute' predicted that the global electric vehicle market in 2030 would be about 56.89 million units. At this time, it was assumed that 24.8 million units would be sold outside of China.
Oversupply of cathode materials is just noise
The combined cathode material capacity of Ecopro BM, POSCO FutureM, LNF, Cosmo Advanced Materials, LG Chem, and STM is expected to increase to 1.54 million tons in 2025 and 3.15 million tons in 2030.
The battery capacity that can be made with 10,000 tons of high nickel cathode material is 6.9GWh, and Hanwha Investment predicts that battery demand will be 3,811GWh assuming 51.03 million electric vehicle sales in 2030.
*CAPA (capacity): Production capacity
At this time, the required cathode material capacity is about 5.52 million tons, and excluding the 1,234 GWh to be sent to China, there is a demand of 2,577 GWh. At this time, the required cathode material capacity is 3.73 million tons, which is a shortfall of about 580,000 tons.
Moreover, the above assumption does not take into account the growth in various areas other than electric vehicles, such as robots, home appliances, and aviation. Therefore, you do not need to worry about the story that there is an oversupply of cathode materials.
Just hold on until ‘this time’
The capacity of domestic companies will be completed in 2025, and their performance will begin to grow rapidly in earnest in 2026. At this time, stock prices are pre-reflected and will rise in 2025. Therefore, investments must be maintained until at least 2025 to experience rapid growth in the performance of K-battery and material companies.
Starting in September, it was a period of adjustment for the entire market, not just for secondary batteries. So, I advise you not to be impatient and take a long-term view and either hold on or buy.