Shang Hai Zheng Quan Bao·2025-12-02 05:08Core Viewpoint - Recent price increase requests have been made by several leading lithium iron phosphate (LFP) companies, driven by supply-demand imbalances and rising raw material costs [1][3][12] Price Adjustments - One leading LFP company announced a price increase of 3000 yuan (excluding tax) per ton for all its LFP products starting January 1, 2026 [1] - Another company has already implemented a price increase of 3000 yuan per ton effective November 1, 2025, while existing contracts will maintain original pricing [3][12] Supply and Demand Dynamics - The LFP market is currently experiencing tight supply, with effective production capacity utilization exceeding 95%, and some leading companies operating at over 100% capacity [3][12] - Despite high demand from the electric vehicle and energy storage sectors, companies face significant challenges in expanding production due to financial pressures, with an average industry debt ratio of 67% [3][12] Industry Response to Competition - The LFP industry is responding to government and industry calls to avoid "involution" and harmful price competition, with initiatives to establish pricing based on cost indices [3][12][13] - The China Chemical and Physical Power Industry Association has urged LFP companies to avoid price dumping and adhere to cost guidelines to improve overall industry profitability [4][13] Market Position and Trends - LFP batteries accounted for 81.5% of the electric vehicle battery installation volume in the first three quarters of this year, marking a 62.7% year-on-year increase [5][14] - In the energy storage sector, LFP batteries hold a 99.9% market share, highlighting their dominance in key applications [5][14] Price Trends - As of December 1, 2023, the average spot price for power-type LFP reached 39,950 yuan per ton, with a price range of 38,400 to 41,500 yuan per ton [6][15] - The average spot price for energy storage-type LFP also increased to 36,950 yuan per ton, with a range of 35,300 to 38,600 yuan per ton [6][15] Company Developments - Longpan Technology announced a significant increase in its LFP supply from 150,000 tons to 1.3 million tons, with an estimated total sales value exceeding 45 billion yuan [8][17] - Hunan Youneng reported a price increase based on strong market demand and ongoing negotiations with clients, while also planning to cautiously manage production capacity based on market conditions [8][17][18]