Waste Lithium Battery Recycling Getting Striking



Waste Lithium Battery Recycling Getting Striking

In late September, FangYuan Environmental Protection (FangYuan EP) released its H1 financial report which shows that the Company reached a YOY revenue increase of 343% in the first six months and net profit attributed to shareholders of listed company enjoyed YOY increase by over 55 times.

Driven by prosperous momentum in NEV market, Cobalt companies presented marvelous performance in the first six months. But a 55-time net profit increase has put the Company in the spotlight. FangYuan EP told us that the big progress in performance mainly resulted from the ever-standing-out scale economies led by production system entering mass production stage and capacity fully being put into use after fundamental completion of large-scale project construction of Gujing Plant; in the meantime, driven by significant deterministic growth of NEV production and sales, domestic and overseas ternary positive precursor market is making breakthrough to some extent and sales enjoys rather fast YOY increase.

Rapid development of global NEV industry is also promoting the jump of power battery. People are expecting better energy density of power battery so ternary material is getting popular. According to related data, in 2018, over 80% power-battery-industry players who were major in lithium-iron battery have made future plans for ternary battery, such as BYD, CATL, Guo Xuan, OptimumNano, NEVS and so on.

The first batch of NEV that hit domestic market is going to be old and waste soon. According to GGII’s report, our power battery scrapped in 2016 was about 12000 tons and the number is going to be 70000 tons in 2018 and is likely to surge to 248000 tons by 2020. Different from lead-acid battery that contains heavy metal and poisonous materials, waste power battery used in NEV is more friendly to environment. Copper, cobalt and lithium in this kind of battery is of significant economic value and waste power battery ever won the appraisal of “lithium battery is too valuable for anyone to miss.”

By taking advantage of great demand for ternary materials as well as a load of present valuable wastes, FangYuan EP used waste resources that contain nickel and cobalt as raw materials for positive materials of nickel battery and lithium battery. FangYuan’s main products are battery grade nickel sulfate, positive materials of nickel battery, sphere nickel hydroxide collection, lithium battery ternary positive materials NCA and NCM precursor collection.

Speaking of turning waste to wealth, we can’t miss out GEM, the “Urban Mines”, whose operating income in H1 is RMB 7.026 billion and whose comprehensive utilization of waste resources accounts for 42.46%.

At present, GEM is constructing new energy full-life-circle value chain featuring “battery recycling-raw material rebuilding-material rebuilding-battery pack rebuilding-NEV service”, with “1＋N” waste battery recycling network being built. GEM has signed the agreement with over 80 auto companies and battery companies related to auto power battery recycling disposal. It is one of the 5 enterprises that were firstly included into “Industrial Norms and Conditions in Comprehensive Utility of Waste Resource of NEV Waste Power Battery” released by MIIT. According to GEM 2017 annual report, the Company has been making progress in the sales volume and production of comprehensive utilization of waste resources.

Nowadays, driven by related policies, more enterprises are getting to prepare themselves for power battery recycling market, which not only works as the last chain in process of battery production to sales, and scrapping to regeneration, but also the supply to scarce metals such as cobalt and nickel.

But be warned, power battery recycling of NEV is just in its early stage, with improved recycling system to be well completed. Raw material recycling channels, supply chain and recycling system are still to be well explored and constructed.

On 27th, September, Tus-Sound announced that in order to seize the opportunity in the construction of waste lithium battery comprehensive utilization project with annual output of 20000 tons in Xiaochang County, Hubei Province. The project will be practically taken care of by its indirect wholly-owned subsidiary, Hubei Bo Cheng Environmental Protection Co., Ltd. (“Bo Cheng EP” hereinafter).

In order to well implement this project, the Group decided to arrange for its wholly-owned subsidiary, Sound (Tianjin) Renewable Resource Investment Holdings Ltd. (“Sound Renewable” hereinafter), to increase capital to Bo Cheng EP so the registered capital would rise from RMB 5 million to RMB 50 million, of which the newly added capital of RMB 45 million will be contributed by Sound Renewable. After this capital increase, the registered capital of Bo Cheng EP will be RMB 50 million. Sound Renewable will allocate another RMB 50 million for Bo Cheng’s 100% share.

According to Tus-Sound, the Company will make the utmost of long-standing partnership with hundreds of domestic renewable resource recyclers, while combining layout advantages of new energy battery industry, to establish favorable cooperation with NEV manufacturers and NEV battery manufacturers, through which, the Company can participate to construct and improve recycling channels of lithium battery. In this way, stable and reliable raw material resources can be ensured and raw material risks can be reduced. Furthermore, the Company plans to use new technologies and process to improve project benefits. By combining experiences, introducing technical teams, giving full play to talent strengths and co-working with domestic outstanding related colleges and professional institutions, the Company will make full examination and verification and constant process improvements to reduce operational technical risks and enhance productivity and investment income.

As what industrial analysis tells, Sound Group and Tus-Sound are two major shareholders of famous domestic power battery enterprise, Soundon New Energy, and the two shareholder companies have made profound arrangements in upstream and downstream areas of the whole industry chain. Today’s Soundon has covered many fields such as lithium battery positive material, precursor, and battery cell production; BMS, PACK and battery cloud platform R&D; Internet + waste battery recycling, battery gradient utilization and battery regeneration techniques. The aforesaid forms a complete lithium battery ecological chain. Tus-Sound made this investment to further improve its arrangement in lithium industry chain, which will surely return to boost the development of its various projects.