Caixin Media, October 17th (Reporter: Liang Xiangcai) Vanadium prices are falling, Pangang Group Vanadium & Titanium Resources (000629.SZ) is under pressure, with a year-on-year decline of nearly 80% in net income in the first three quarters; recently, the downstream major customer of the company's star product, vanadium electrolyte, Dalian Rongke, has taken new actions.

Tonight, Pangang Group Vanadium & Titanium Resources released its third-quarter report. The company achieved a total revenue of 10.474 billion yuan, a year-on-year decrease of 6.12%; net income was 0.183 billion yuan, a year-on-year decrease of 78.92%; continuing the downturn of nearly 80% year-on-year net income decline in the first half of the year.

Regarding the reasons for the decline in performance, Pangang Group Vanadium & Titanium Resources mentioned in the third-quarter report that it was mainly due to the price decline of vanadium products from January to September this year.

According to Choice data, the average price of domestic vanadium (≥99.5%) from January to September 2024 was 1243 yuan/kg, a decrease of about 22.31% from the price of 1600 yuan/kg in the same period last year.

Of note is the vanadium battery-related business involving Pangang Group Vanadium & Titanium Resources, which has attracted significant attention from investors. The vanadium electrolyte produced by the company is mainly supplied to Dalian Rongke.

Recently, Pangang Group Vanadium & Titanium Resources stated on the investor interaction platform that the 2,000 cubic meter vanadium electrolyte production line planned by the holding subsidiary, Vanadium Rong Energy, with Dalian Rongke, has achieved production and effectiveness. The company will continue to invest jointly with Dalian Rongke to build a 60,000 cubic meter/year vanadium electrolyte production line according to the joint venture agreement signed between the two parties. Tianyancha shows that Vanadium Rong Energy is located in Panzhihua Vanadium and Titanium Industrial Park, Renhe District, Panzhihua City.

On October 15th, according to the Panzhihua Municipal Government's government open information, the Panzhihua Vanadium and Titanium High-tech Zone Management Committee and Dalian Rongke's Dalian Hengrong officially signed an investment contract for the Panzhihua All-Vanadium Liquid Flow Battery Energy Storage Equipment Intelligent Manufacturing Base project, to build a highly intelligent, highly flexible, and highly modular all-vanadium liquid flow battery energy storage equipment manufacturing line. The person in charge of Rongke Energy said that the goal is to complete the first phase of the all-vanadium liquid flow battery energy storage equipment intelligent manufacturing base project by March next year.

It is reported that Dalian Rongke is a leading domestic industry company specializing in vanadium battery energy storage technology development, equipment manufacturing, and industrialization. It is the only service provider in the world with independent intellectual property rights for vanadium batteries, complete industry chain development, and manufacturing capabilities, as well as having the world's largest-scale vanadium battery energy storage equipment and vanadium electrolyte production base.

Some institutions have indicated that the domestic vanadium battery industry chain has basically taken shape, and the market demand urgently needs to be released. With the innovation of commercial models in the electrolyte and battery stack segments, as well as the acceleration of domestic substitution, initial investment and LCOE are expected to further decrease. The average annual quote for vanadium battery energy storage systems in 2023 is 2.778 yuan/Wh.

Pangang Group Vanadium & Titanium Resources' main products include vanadium oxide, ferrovanadium, vanadium nitride alloy, vanadium aluminum alloy, vanadium electrolyte, titanium dioxide, titanium slag, etc. Among them, vanadium products are mainly used in the steel industry for vanadium pentoxide, ferrovanadium, vanadium nitride alloy, and in all-vanadium liquid flow batteries for vanadium electrolyte.