Lithium battery will be ten times as bullish in the future, lithium ferrous phosphate?

Since the third quarter, the parity of technology-driven new energy vehicles in lithium ferrous phosphate has been verified by data, and the revaluation of the whole industrial chain of phosphate rock, phosphorus chemical industry, precursors and lithium ferrous phosphate materials reflects the first round of rising waves. After Tesla, BYD, domestic new forces and other companies completely switch iron-lithium models, the market will increase by more than 60% in 2022. With international brands such as Volkswagen, Renault, BMW, Daimler, Ford, Tata, etc. defining the fixed point of iron and lithium, the overseas penetration rate will gradually converge to China from 2023. In the next stage, the expected difference will gradually change from domestic+overseas, power+energy storage beta opportunities to alpha opportunities brought about by technology dividends and supply chain advantages.

At present, the market expects that the pattern of lithium ferrous phosphate is chaotic, involving phosphate rock (Hubei Yihua, Yuntianhua), phosphorus chemical industry (Chuanfa Longman, Chuanheng), iron phosphate (Zonghe Technology, Annanda), lithium ferrous phosphate (Longpan Technology, Fengyuan) and other enterprises with different backgrounds. The organization believes that the competitiveness of technology dividend and supply chain advantage will be reflected in the core link of the predecessor, thus reflecting the difference in pattern gradient and valuation:

1) Fulin Seiko exclusively develops ferrous oxalate process, focusing on high-voltage and high-density high-end power, including passenger cars with a class of over 300,000 and German long-term nano-focusing high-end energy storage and long-term barriers. Iron nitrate process lies in the recovery of nitrogen oxides, and ferrous oxalate process lies in the control of ball milling media. At the same time, Fulin Seiko can use lithium phosphate-lithium dihydrogen phosphate as the only source, opening up the space for cost reduction.

2) Cost-oriented utilization of the lowest-cost phosphorus source (monoammonium phosphate/crude phosphoric acid), the lowest-cost iron source (iron oxide) and the lowest-cost acid (waste sulfuric acid), such as Tianci Materials and Hunan Yuneng, and development of rotary kiln to reduce unit power consumption.

3) Develop materials close to major customers, such as Contemporary Amp Technology Co., Ltd. and BYD, to ensure the safety of the supply chain, such as Longpan Technology and Fengyuan.

4) Grasp the strategic resources of phosphate rock. For example, Hubei Yihua has a joint venture with Guangdong Bangpu, a subsidiary of contemporary Amperex Technology Co, Ltd., and uses nickel-iron ore of CBL to extract iron source and phosphate rock for recycling production, so as to make long-term reserves for converted iron and lithium. As a ternary material enterprise, the transformation of iron and lithium mostly adopts similar methods, such as Zhongwei and Huayou Cobalt.

The organization believes that the gradient of lithium ferrous phosphate pattern will be reflected as follows: (1) the precursor of technological advantage; Cost-oriented precursor >: lithium ferrous phosphate material > mineralization integration.

The views in this paper do not represent specific investment operation opinions.