CATL(SZ:300750) Zheng Quan Shi Bao·2025-10-30 06:40Core Viewpoint - The lithium iron phosphate (LFP) industry is experiencing a new round of capacity expansion driven by strong downstream demand, with a focus on high-end products and overseas markets, transitioning from price and scale competition to value and technology competition [1][10]. Group 1: Market Demand and Supply Dynamics - Leading LFP manufacturers are currently operating at full capacity, with second and third-tier manufacturers also increasing their utilization rates [2]. - There is a notable shift in manufacturer attitudes, with some companies beginning to selectively choose customers and testing price increases for smaller clients [2]. - In September, CATL signed a prepayment agreement with Jiangxi Shenghua, committing to pay 1.5 billion yuan to secure LFP supply, with a minimum annual procurement of 80% of Shenghua's promised capacity from 2025 to 2029 [2][3]. Group 2: Capacity Expansion Plans - Jiangxi Shenghua plans to invest 4 billion yuan to build a new LFP project with an annual capacity of 350,000 tons [9]. - Longpan Technology announced a fundraising plan of up to 2 billion yuan for multiple LFP projects, including an 110,000-ton project in Shandong and an 85,000-ton project in Hubei [9]. - The overall industry operating rate has exceeded 60% this year, with expectations of over 70% next year, indicating a balanced effective capacity by next year and potential shortages in the following year [8]. Group 3: Competitive Landscape and Industry Trends - The LFP industry is witnessing a dual scenario of expansion and contraction, with leading companies experiencing full orders while smaller firms face potential exit or upgrade challenges [12]. - The industry is shifting towards high-quality competition, focusing on technology, market presence, and cost efficiency rather than low-price competition [12]. - Technological advancements are being prioritized, with a focus on high-pressure density, fast charging, and long cycle life products [13]. Group 4: Global Market and Integration Strategies - Companies are increasingly focusing on overseas markets, with the ability to quickly release effective capacity abroad becoming a competitive advantage [14]. - The LFP industry is currently in a marginal profit state, leading to a trend towards integrated operations, with companies like Hunan Youneng achieving full self-supply of LFP resources [14]. - The overall market for LFP batteries in China saw a significant increase, with a 62.7% year-on-year growth in installed capacity for the first three quarters of the year [5].