I bought and EV about a year ago, so I have a special interest in what’s happening in the lithium and lithium battery markets. A guy who comes to our community fitness center almost as often as I do has written a book on lithium. More on that later.
Let’s combine an interest in lithium battery technology and manufacturing with a market analysis by the research firm I’ve found to have the best methodology, Interact Analysis. Research Associate Renee Ju has written about her latest report, “Li-ion Battery and Manufacturing Equipment”, that provides a deep analysis of the current battery recycling market.
Interact Analysis’ upcoming report “Li-ion Battery and Manufacturing Equipment” , and this insight explores some of the key themes in the report.
Manufacturers that establish recycling businesses come from across the battery industry chain, including upstream raw mineral and material suppliers, midstream battery manufacturers, vehicle OEMs and businesses specializing in battery recycling. In China, there are fewer large-scale companies that specialize in lithium battery recycling and currently companies with battery recycling plants tend to be manufacturers from elsewhere in the lithium battery industry chain. In contrast, in other major country markets the li-ion battery recycling market is dominated by large-scale recycling manufacturers that specialize in recycling businesses, such as Li-cycle. Other companies in the lithium battery industry chain predominantly participate in the battery recycling market through collaboration with recycling companies.
Aside from signing cooperative research agreements, cooperation on battery recycling among companies in the lithium battery industry chain usually takes the form of signing supply agreements. These can be divided into directional supply and establishing a closed-loop recycling ecosystem. Directional supply involves OEMs and battery manufacturers supplying scrap batteries or scrap materials to recycling companies, and recycling companies supplying recycled materials obtained from processing scrap batteries to raw material manufacturers.
In contrast, some companies collaborate with the aim of establishing a closed-loop recycling ecosystem. If we take the collaboration announced by GEM in February 2023 with Mercedes-Benz China, CATL, and Brunp as an example: Mercedes-Benz China’s retired waste batteries will be processed by GEM and Brunp, with the recycled key raw materials such as nickel, cobalt, manganese, and lithium supplied to CATL’s supply chain and used to produce new batteries for Mercedes-Benz. The cooperation in battery recycling between upstream and downstream companies in the lithium battery industry chain not only meets environmental protection requirements but also maximizes battery value and reduces battery production costs.
Some companies whose main operations are not directly related to batteries are also exploring the market for battery recycling, such as sanitation companies and other recycling enterprises (including those specializing in metal recycling and solid waste recycling). Typically, these companies run the battery recycling businesses through collaboration with lithium battery-related companies, with the recycling business supplying the products of their recycling plants to raw material manufacturers for further application in the lithium battery industry and for use in other industries. For example, the recycled nickel, cobalt, and tungsten powders can be utilized in the production of hard alloys, rather than being directly used in the production of lithium battery-related products.
With the rapid expansion of lithium battery capacity and the imminent wave of retired power batteries, recycling has become a safe, environmentally friendly, and economical way to dispose of scrap batteries and raw materials. As relevant policies and regulations are continuously improved and implemented by different countries, the battery recycling market is entering a new stage of professionalization and scale, with market opportunities continuously emerging. As a restructuring of the industry ecosystem takes place, optimizing resource allocation, strengthening technological research and development, accelerating upstream and downstream collaboration, and promoting the integration of the industrial chain may become the keys to success.
