Analysis of the Ministry of Finances Support for the Industrialization Plan of Battery Separators

On the 31st, the list of new material research and industrialization projects to be supported in 2013 was announced, including three companies' battery separator projects. The gross profit margin of battery separators is relatively high, and currently most of the separators used in China are imported. Some A-share listed companies have seized this opportunity to enter the market and layout.

Promotion of industrialization of battery separators

On the 31st, the website of the Ministry of Finance announced the list of new material research and industrialization projects to be supported in 2013. The projects related to batteries are all membrane projects, including the high safety and heat-resistant membrane project for power batteries of Hebei Jinli New Energy Materials Technology Co., Ltd., the high-performance lithium-ion battery membrane research and industrialization and demonstration application project in power batteries of China LeKai Group Co., Ltd., and the 40 million square meter high performance lithium-ion battery wet PE film project of Qingdao Haiba Energy Group Co., Ltd.

Public information shows that Jinli New Energy's overall plan includes an annual production of 270 million square meters of ultra-high molecular weight PE wet single-layer and coated separators for high-end lithium-ion batteries. The first phase of the company's project has been completed and put into mass production in September 2012, with an annual production capacity of 20 million square meters for high-end wet process separators for lithium-ion batteries. The technical indicators of the full battery prepared using the company's products have been tested and certified by the China Automotive Research and Technology Center, a national authoritative institution, and have reached the international advanced and domestic leading level.

It is understood that the battery separator is a crucial part of the battery, separating the positive and negative electrodes of the battery and playing an important role in battery safety. The cost of separators accounts for about 20-30% of the total cost of lithium batteries, with a gross profit margin of over 60%, which is the highest among the four major lithium battery materials. At present, domestic diaphragms are mainly imported from Japan, and the production cost of domestic diaphragms is about half of that in Japan. In the future, with the commissioning of diaphragm projects by domestic enterprises, there is huge room for import substitution.

Listed companies actively layout

The high gross profit margin of the diaphragm industry has also attracted many listed companies to enter and lay out.

In 2011, Da Southeast raised 366 million yuan through a non-public offering of shares to invest in a lithium battery ion isolation membrane project with an annual output of 60 million square meters. The company recently announced that the lithium battery separator production line is currently in the debugging stage.

The Cangzhou Mingzhu lithium battery separator project started trial mass production in October 2011, and a new line with a production capacity of 20 million square meters was put into operation in May this year. Combined with the existing production capacity of 6 million square meters for lithium battery separators, it is expected that the production of lithium battery separators in Cangzhou Mingzhu will reach 13-14 million square meters this year.

Jiujiu Jiu plans to invest in a 13.2 million square meter lithium battery separator project with an annual output in Rudong Coastal Economic Development Zone, Jiangsu Province. Among them, the designed production capacity of the first production line is 6.6 million square meters, which has been tested but is still in the trial period of sample delivery. It is expected to gradually contribute to the company's performance from 2014 onwards.

Other listed companies involved in the diaphragm industry include Fosu Technology, Yuntianhua, Shenzhen Huicheng, Nanyang Technology, and Duofuduo.

It should be pointed out that the influx of numerous enterprises into the diaphragm industry has also brought many problems: on the one hand, the total planned production capacity has exceeded the actual shipment volume; On the other hand, the proportion of actual shipments that can be accepted by the market is not high.

Industry insiders pointed out that the technical barriers for power cathode materials and separators are relatively high, and the overall level in China is relatively backward. It is difficult to meet the technical requirements of power grade batteries in the short term and enter the main supply chain. According to the research report by Guotai Junan, the market share of diaphragm enterprises in China is only 6%, making it difficult for domestic products to be used for power batteries. At present, the quality positioning of domestic diaphragms is still focused on the mid to low end, and there are not many high-quality diaphragms that meet market demand. Enterprises should value reliable technology.