January 17, 2019: Three lead acid battery manufacturers in China have been officially certified as having met industrial requirements to operate, the Ministry of Industry and Information said on December 24. It is the sixth batch of certifications being granted in recent months.
Anhui Uplus Energy Technology, Anhui Leoch Battery Technology and Zhaoqing Leoch Battery Technology bring the total number of qualified lead battery makers to 147, added to an estimated 50 non-certified firms that are either in the process of being granted certification or being closed down, according to Eve Yeo, editor at the Shanghai Metals Market.
“Current policy raises the requirement for industry access and gives the government greater control over industry access. To the best of our knowledge, there are no caps (on the number of new facilities),” she said.
The certifications fly in the face of Chinese government policy to lean towards lithium batteries and away from lead batteries as it encourages the EV market, says Neil Hawkes, principal consultant at business intelligence company CRU.
“Broadly speaking, Chinese lead demand — which is dominated by lead batteries — has been slowing through last year and the omens are not good for this year either as the government stimuli announcements keep coming,” he said.
“Slower broader economic growth in China is being compounded by weaker vehicle sales (falling last year for the first time in many years), which hits OEM automotive lead-acid battery sales/demand. Structural policy has shifted away from LABs to LIBs in telecoms, and the boom in e-bikes is already long gone and on the way down.
“So the prospects for lead demand in China are not great — we have it growing at no better than around 1% per year over the next few years, which is far removed from the days of double-digit growth in the 2010s. Beyond that it will do well to stay in positive territory, assuming EVs continue to take off through the 2020s.
“Which does make it somewhat surprising to hear of more LAB plants being built, though part of it is probably the government realization that LABs will still be needed for a while yet, so as part of the cleaner skies push it makes sense to make them at shiny new big plants rather than the older smaller ones that have been shut.”
Almost 90% of China’s lead-acid battery makers were closed after a cull was launched in 2010 to either shut the unregulated factories or absorb them into larger ones. In total, 1,744 lead storage battery makers were inspected and just 229 left open, deputy secretary general of the China Battery Industry Association Cao Guoqing was quoted by news sources as saying in November 2011.
In 2012, the MIIT announced its ‘Lead-Acid Battery Industry Access Conditions’, which went into effect in July that year. Under the conditions, new, reorganized and expanded lead battery factories had to have battery capacity of no less than 500,000 kVA, and existing plants had to be 200,000 kVA or more.
Any reorganization or outsourcing of plates or plate-assembled batteries was banned, and production equipment and technology had to be updated.
