Financial News Agency, November 23 (Reporters Li Zijian and Zeng Chuchu) - Composite copper foil factories keep a secret of key indicators and order conditions for their products, causing the secondary market to be in turmoil from time to time due to “small essays.” Meanwhile, at the 2023 High-Tech Lithium Battery Annual Conference, Dr. Sun Yaoming, director of the Jinmei New Materials Application Center, predicted that the cost of composite copper foil in the fourth quarter of next year will be the same as that of electrolytic copper foil.

In addition to this, according to an offline exchange between a reporter from the Financial News Agency and people in the composite copper foil factory, upstream equipment factory, and related industry chain people, it was learned that most of the technical routes of composite copper foil factories have switched from PET or are developing PP routes at the same time. However, according to sources related to composite copper foil to the Finance Association, the PP route is probably 2-3 times more difficult to develop than PET.

Next year's Q4 cost may remain the same as traditional copper foil

Jinmei New Materials is a core manufacturer of composite fluid collectors in China. It has attracted attention from the capital market due to its rapid progress in the PP route and its close relationship with the Ningde Era (300750.SZ). Dr. Sun Yaoming, director of its application center, shared at the 2023 Hi-Tech Lithium Battery Annual Conference that product development and mass production stages are generally divided into ABCDs.

The first stage is the conceptual design stage. It mainly considers what kind of product is needed and whether the development and verification process is feasible. This process generally produces type B, and model A-B is the product development stage, which is stage 0-1.

It further stated that during the project development stage, the company will have batch products, stable processes, and finally produce C samples, that is, it reaches the product stage. Later, when it was expanded, there are already stable product parameters that have been verified by customers, including production processes and equipment. At this time, the company will pay more attention to the commercialization stage in terms of consistency, production capacity, efficiency, and cost. At this time, a D pattern will occur. The process from sample C to sample D is 1-100.

According to Dr. Sun Yaoming, in 2015, the company was in the A phase, 2018 was the B phase, 2022 was the C phase, and in 2023, the company's expansion and reproduction was in the D phase. Since 2020, the MC (composite copper foil) design process has been fixed, from sample conversion to product stage, and production capacity has been climbing.

According to public information, Jinmei New Materials can currently achieve a production capacity of about 100 million square meters per year at its demonstration base in Qijiang, Chongqing. In May of this year, Jinmei New Materials' new multi-function composite fluid collection expansion base project was officially signed and settled in Nanxi District, Yibin City, Sichuan Province. The base has a total investment of 5.5 billion yuan and a planned production capacity of 1.2 billion square meters. It will be carried out in stages.

In terms of cost, Dr. Sun Yaoming said that commercialization focuses most on the cost aspect. The company has adopted the best cost performance process. The next stage is expected to be basically the same as that of electrolytic copper foil, and the next stage is expected to be in the fourth quarter of next year.

As far as the situation is concerned, the Finance Association reporter had offline exchanges with relevant people at the two composite copper foil factories and learned that the sales price of composite copper foil is probably 10% to 20% higher than that of traditional lithium battery copper foil. One of the industry insiders said that costs will inevitably drop in the future. Currently, the company mainly guarantees quantity, and the company also needs continuous improvement, not paying much attention to profit.

Another industry insider told the Finance Association reporter that the yield of composite copper foil reaches 80% or more, and the cost is the same as that of traditional lithium battery copper foil, but after reaching 90% or more, it will be lower than traditional lithium copper foil.

Dr. Sun Yaoming disclosed the latest efficiency data, saying that the company's MC process yield is now greater than 85%, and the roll length has risen to 10,000 meters. Also, according to participants at the composite copper foil factory to a reporter from the Financial Association, the current problem of composite copper foil disconnection is that their peers are basically stuck at 1,000-2,000 meters.

Dr. Sun Yaoming also shared the demand situation for composite aluminum foil (MA). He said that currently in a situation where supply is in short supply, the company will continue to expand production and increase product shipments in the next stage. In the next stage, shipments will increase by 50%, and costs will drop by about 50%.

On the other hand, people in the relevant industry chain have also expressed concern. They believe that composite fluid collectors are still controversial, and they are thinking internally about whether it is a transition product, because after the battery reaches a semi-solid/all-solid state product, the safety issues will basically be solved. However, if a composite collector is used, both the equipment factory and the battery factory require process coordination, and will the capital expenditure be economical?

The PP route may prevail

Composite fluid collector is a new type of fluid collector material with a sandwich structure of “metal conductive layer - polymer material support layer - metal conductive layer”. Theoretically speaking, composite copper foil has the advantages of high safety, low cost, and high energy density compared to traditional copper foil. Currently, the main technical routes are PP base film and PET base film.

Yu Can, a copper strip foil analyst at the Shanghai Steel Union Copper Division, told the Financial Association reporter earlier that PET copper foil has cyclic diving problems, low melting point of PP base film, poor tensile strength, and current lack of targeted development. The technical bottleneck of PP copper foil is very high, mainly reflected in the adhesion problems between PP and the copper layer, tensile strength, and heat resistance.

A financial news agency reporter noticed that in the early stages of domestic A-share composite copper foil manufacturers such as Baoming Technology (002992.SZ), British Union (002846.SZ), and Putailai (603659.SH), mainly used the PET route in the development of composite copper foil, but then they all switched to or developed the PP route at the same time.

A person from a PP route composite copper foil manufacturer told the Financial Association reporter that the PET diving problem is quite serious. There is actually nothing that can be discussed among the various performance parameters of PET and PP, because the most important thing about composite collecting fluid is to solve safety, but after using PET composite collecting fluid for a few years, the risk is even greater, and it is clearly unusable.

The explanation is that their peers chose the PET route early on because PET is very easy to do. Not only is PET very adhesive, it is superior to PP, including high temperature resistance and stretching. This is also the reason why manufacturers that have just entered the market prefer PET. It is easy to use and suitable for newcomers to get started.

The person mentioned above also said that the transition from PET to PP is not that simple; the PP process is much more difficult than PET, about 2-3 times more difficult. According to a reporter from the Financial Association, this person's composite copper foil factory had a dual PET and PP layout in the early stages, but currently the PET route has basically been abandoned.

The industry thinks it's a circular diving problem. A relevant person from the composite copper foil equipment factory revealed to the Financial Association Reporter that there were many customers who asked about PET production lines before, but now there are almost none; they have all switched to the PP route.

While attending the conference, a reporter from the Financial Services Association spoke with people who set up the PET composite copper foil sample booth. They admitted that PET has diving problems, but believes that PET composite copper foil still has advantages in the consumer and motorcycle markets. At the same time, he also said that the company will launch new PP products in the near future.

However, Wang Rongfu, chairman of Hanyi New Materials, a composite copper foil factory, “stood up” for the PET route at the 2023 Gaogong Lithium Battery Annual Conference. Regarding the situation where PET materials are heated and soaked in electrolyte and cycle tests, Wang Rongfu believes, “Through modification, electrolyte resistance can be achieved, and at least the number of cycles can be increased.”

Wang Rongfu also believes that it is still necessary to move towards PET modification at present, because PP is hard to buy materials; second, the process is really difficult. It said that even if PP improvements solve the problem of lack of focus, this cost will not come down.