Core Viewpoint - The lithium battery industry, particularly the lithium iron phosphate (LFP) sector, is experiencing a significant "game" between upstream manufacturers and downstream battery producers, with intense price negotiations and potential supply chain disruptions [2][3]. Group 1: Market Dynamics - Upstream LFP manufacturers have faced nearly three years of losses and are eager to raise prices, while downstream battery manufacturers are seeing prices decline [2]. - A procurement agreement between Rongbai Technology and CATL worth over 120 billion yuan has sparked market discussions, potentially marking the largest order in the LFP industry [2][5]. - The Shanghai Stock Exchange has requested a comprehensive self-examination from Rongbai Technology regarding the procurement agreement, focusing on its ability to fulfill the contract [2][6]. Group 2: Production and Supply Challenges - Major LFP manufacturers, including Hunan Youneng and Wanrun New Energy, have announced production halts for maintenance, which is seen as a collective effort to pressure battery manufacturers for higher processing fees [4]. - In early 2026, it was reported that most clients accepted a processing fee increase of 1,000 yuan per ton, indicating some success in the manufacturers' strategy [4]. - Rongbai Technology is expected to supply 3.05 million tons of LFP materials to CATL over six years, averaging over 500,000 tons annually, despite currently having only 60,000 tons of production capacity [5][7]. Group 3: Technological Developments - Rongbai Technology claims its LFP products utilize a revolutionary process that reduces production steps from 15 to 6, lowering investment costs by approximately 40% and energy consumption by about 30% [8]. - The new "RB one-step process" developed by Rongbai Technology is based on first principles and aims to simplify production, although it is currently only at the pilot stage [9]. - Other companies, such as GCL-Poly, are also exploring one-step production methods, which are reported to have lower investment costs compared to traditional methods [10]. Group 4: Industry Concerns - There are concerns regarding Rongbai Technology's ability to meet the supply commitments outlined in the agreement with CATL, as their current production capacity is significantly lower than required [6][8]. - Industry experts have expressed skepticism about the feasibility of Rongbai Technology's new production technology, citing challenges in impurity removal and the potential for aggregation issues [11].