Since Q3 this year, the booming energy storage market has driven rapid growth in demand for lithium battery materials, with prices of key materials such as lithium hexafluorophosphate, lithium iron phosphate, and lithium carbonate soaring. The lithium battery materials sector has become a top performer in the A-share market recently.
A representative from a lithium carbonate producer in Sichuan revealed that demand is currently robust, with full production capacity still unable to meet customer needs. Some long-term contract clients have even booked hotels near the factory to secure shipments, stating that "every ton produced is immediately shipped out."
From a technical perspective, lithium iron phosphate (LFP) batteries dominate the new energy storage sector, accounting for over 97% of installations. Industry experts believe energy storage is emerging as a new growth driver for lithium battery demand, and this "feast" may just be beginning.
At the "10th International Power Battery Application Summit," Li Liangbin, Chairman of GANFENGLITHIUM (01772), projected global lithium carbonate demand at 1.45 million tons in 2025. However, due to stronger demand in H2, the full-year estimate was revised upward to 1.55 million tons. Supply capacity stands at over 1.7 million tons, resulting in a surplus of around 200,000 tons, which has kept prices subdued this year.
Looking ahead to 2026, Li expects lithium carbonate demand to grow by 30%, reaching 1.9 million tons, while supply is projected to increase by approximately 250,000 tons, achieving a balanced market. This could create upward price momentum. If demand growth exceeds 30%—potentially hitting 40%—short-term supply imbalances may push prices beyond RMB 150,000/ton or even RMB 200,000/ton.
Last week, Hypontech signed a three-year, 200GWh mega-order with CATL, confirming tight supply in the energy storage battery sector. The excess profits from downstream energy storage investment and operations are expected to flow upstream to materials, batteries, and integration segments through price hikes, presenting volume and margin expansion opportunities across the chain.
Analysts remain bullish on materials—particularly lithium hexafluorophosphate (6F), LFP, anodes, separators—and battery segments. Key factors to monitor include: 1. Tight supply and rising prices for materials and energy storage batteries during peak production seasons. 2. Clearer 2026 demand visibility following October/November procurement and long-term contract guidance. 3. Evolving pricing models.
**Relevant Hong Kong-listed stocks in lithium battery + energy storage:** - **Lithium Battery Materials:** GANFENGLITHIUM (01772), TIANQI LITHIUM (09696), CNGR (02579), LOPAL TECH (02465) - **Energy Storage:** BYD (01211), CALB (03931), REPT BATTERO (00666)
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