According to an official ** report on Monday, the chairman of Zhejiang Huayou Cobalt proposed before the National People's Congress that China should take measures to solve the problem of overcapacity in the lithium battery materials industry.
Chen Xuehua, a deputy to China's National People's Congress, said that overinvestment last year led to "serious overcapacity". The National People's Congress convened in Beijing on Tuesday.
Chen noted that industrial capacity utilization has "declined significantly".
According to the Shanghai ** Daily, Chen said: "Some companies are facing great difficulties in their operations, with production stoppages, idle equipment and layoffs. ”
Citing industry data, he added that China's lithium iron phosphate production capacity will reach 5.75 million tonnes by 2025, while global demand for cathode materials, which are widely used in batteries, will reach around 2.67 million tonnes in 2025.
Chen's company, a major producer of nickel and cobalt for battery materials, recommends timely industry information, early warning systems for mismatches in resources, capacity and demand, and guidance for investment and development.
Regulations in Europe and the United States have made it more difficult to source used batteries and raw materials, which challenges China's leadership in the lithium battery chain, Chen said. His company's ** used batteries.
He said China should encourage more imports of used battery materials, especially hydroxide intermediates made from spent lithium batteries, including lower tariffs.
China bans the import of used lithium batteries and black blocks, which are fragments from used batteries, including lithium, cobalt and nickel. These metals can be extracted and used to make new batteries.