The overseas demand for lithium iron phosphate has exploded

On January 4th, Lithium Source Technology's Indonesian production base successfully shipped lithium iron phosphate products, becoming the first Chinese iron lithium factory to start mass production overseas. It is reported that the total planned production capacity of Lithium Source Technology's Indonesian production base is 120000 tons. The annual production capacity of 30000 tons in the first phase has been completed, and the construction of a 90000 ton production line in the second phase is also ready to take off. And the company has secured five-year supply agreements with top international battery manufacturers such as LGES and Blue Oval.

In December 2024, Changzhou Lithium Source and Asia Pacific Lithium Source revised the Long Term Supply Agreement signed by both parties in February of that year with LG New Energy (LGES) of South Korea, increasing the sales volume of lithium iron phosphate cathode materials from Lithium Source to LGES from 160000 tons to 260000 tons before 2028.

In January 2025, the holding subsidiary Lithium Source (Asia Pacific) signed an agreement with Blue Oval, a subsidiary of Ford, to supply lithium iron phosphate materials from 2026 to 2030.

On April 2nd, Israeli specialty mineral company ICL announced that its BMIQ lithium iron phosphate (LFP) battery material trial production base located in St. Louis, Missouri, USA, has officially commenced operations. This is the first facility of its kind in the United States, marking a significant advancement in LFP battery material production technology. The center has a total investment of 20 million US dollars, with a pilot manufacturing capacity of 1 ton, and is equipped with a complete process simulation production line. It also has both technical research and practical production functions.

In January of this year, ICL partnered with German Nanotechnology to establish a lithium iron phosphate factory in Spain. According to the agreement, the two parties plan to invest 285 million euros to increase ICLBM's capital, and S.L. (the project company) will use it to build a lithium iron phosphate cathode material production project.

As the saying goes, before the troops move, food and supplies come first. The actual demand situation can be seen from the expansion of enterprises. With the acceleration of the iron lithium conversion of overseas new energy vehicles and the requirement for localized energy storage in some countries, domestic iron lithium factories have gone abroad to build factories. As of now, companies that have announced the expansion of lithium iron phosphate factories overseas include Hunan Yuneng, Hubei Wanrun, Rongtong High tech, Guoxuan High tech, Zhongwei Co., Ltd., Qingshan Holdings, BYD, Huayou Cobalt, Tianci Materials, etc.

With the addition of a 125% equivalent tariff imposed by the United States on domestic energy storage manufacturers, the cumulative tariff on energy storage has reached 173.4%, leading to an urgent need for overseas iron lithium materials and batteries in the US energy storage market. Overseas manufacturers with iron lithium production capacity have become a "hot commodity" in the market.