China Securities Co., Ltd.: The expected price increase of lithium carbonate after 26 years will be realized, and the economic advantages of sodium batteries will gradually become evident.

China Securities Co., Ltd. released a research report stating that by the end of 2026, large sodium battery manufacturers are expected to achieve lithium-sodium price parity, and in 2027, the sodium battery industry will enter a phase of mass production at parity. Large-scale energy storage is the main battlefield for the commercialization of sodium batteries, with overseas owners willing to pay a safety premium, and overseas energy storage stations will be the first to see mass production. In the medium term, sodium batteries are expected to gain a foothold in the power sector due to their advantages in low temperature performance and safety. The company predicts that the market demand for sodium batteries in 2030 is expected to reach 500GWh. In 2027, sodium batteries will enter a phase of mass production at parity, and the expected rise in lithium carbonate prices will accelerate the process of sodium battery mass production. It is important to pay attention to the opportunities for industrialization and mass production of sodium batteries and prioritize the layout of the battery and aluminum foil segments. China Securities Co., Ltd.'s main points are as follows: The expected rise in lithium carbonate prices combined with cost reduction in sodium batteries will result in mass production at parity for sodium batteries in 2027. At the current stage, the cost of lithium iron phosphate battery cells is about 0.38 yuan/Wh. If by the end of 2026 lithium carbonate prices rise to 200,000 yuan/ton and copper prices rise to 110,000 yuan/ton, then the complete cost of lithium iron phosphate battery cells will reach 0.42 yuan/Wh. Currently, the cost of sodium battery cells for leading manufacturers is about 0.47 yuan/Wh. The company predicts that leading manufacturers' sodium ion battery cells will have a cost advantage over lithium ion batteries by the end of 2026 due to factors such as cost reduction resulting from large-scale production of materials, improved yields, and increased utilization rates. Even considering that the packaging process may be more expensive by 1-2 cents/Wh, the company predicts that by the end of 2026, the cost of sodium battery cells from leading manufacturers will be on par with lithium-ion batteries, and in 2027, a phase of mass production at parity will begin. In the short term, large-scale energy storage will be the primary battleground, with penetration into the power sector in the medium term. Overseas energy storage station owners have relatively low price sensitivity and are willing to pay a safety premium, making them likely to see mass production first. In the medium term, sodium batteries are expected to gain a share of the power market due to their cost, low temperature performance, and safety advantages. Sodium ion batteries have significant advantages in low temperature performance, safety, and charge-discharge rate, making them suitable for high-altitude energy storage, winter electric vehicles, and other scenarios. The use of sodium batteries relies on abundant crustal reserves of sodium salts in China, completely avoiding the geopolitical dependence and price volatility risks associated with lithium resources mainly concentrated in South America and Australia, achieving independent and controllable supply chains. The company predicts that by 2030, the market size of sodium batteries is expected to reach close to 500GWh, with 323GWh for energy storage demand, 152GWh for power demand, and 16GWh for other markets such as start-stop batteries and electric bicycles. The structure of sodium batteries is similar to that of lithium batteries, with most materials compatible with lithium batteries, but significant changes in the positive/negative/aluminum foil segments. Compared to lithium batteries, the current cost of sodium batteries in terms of electrode materials, positive electrodes, and aluminum foil has decreased, but the cost of negative electrodes and electrolyte segments has increased. Positive electrodes for sodium batteries are mainly composed of layered oxides and poly-anion routes, with the layered oxide route having high energy density suitable for power scenarios, and the poly-anion route having high cycle life suitable for energy storage scenarios. Negative electrodes primarily use biomass-based hard carbon, with raw materials including coconut shells, starch, straw, etc., offering advantages such as mature technology and low cost, but with challenges related to material consistency and impurity control leading to inadequate product batch stability. The electrolyte used in sodium batteries is sodium hexafluorophosphate, with a solute/additive system compatible with lithium batteries. The separator is compatible with the lithium battery system. The current flow of sodium batteries can use aluminum foil for both positive and negative electrodes, significantly increasing the amount of aluminum foil used. Looking at the production progress of sodium battery manufacturers, the layered oxide route of sodium batteries from Contemporary Amperex Technology and BYD Company Limited is more advanced, while among manufacturers of poly-anion sodium batteries, Veken Technology is more advanced. Risk factors 1. Risks related to technological route iteration; 2. Risks related to fluctuations in lithium carbonate prices; 3. Risks related to the immature supporting industry chain; 4. Risks related to increased industry competition and overcapacity; 5. Risks related to policy and standard uncertainties.