Figure 1: Panoramic Overview – The Pyramid from "Resources" to "Applications"

Upstream: Resource Foundation

Lithium battery production begins with the extraction of key mineral resources, including:

Lithium (from brine lakes or hard-rock mines)

Nickel

Cobalt

Graphite

China currently holds about 85% of the world's lithium carbonate processing capacity.

The Chinese lithium battery market size reached approximately RMB 1.75 trillion in 2024.

Midstream: Manufacturing Core

The midstream sector focuses on battery material production and cell manufacturing.

Four Key Materials

Cathode material: ~40% of battery cost

Anode material: ~10–15%

Electrolyte: ~10–15%

Separator: ~8–12%

Manufacturing Process

Material preparation
→ Cell manufacturing (winding or stacking, electrolyte filling)
→ Battery pack assembly (PACK, including BMS)

The midstream manufacturing segment accounts for about 70% of the total battery cost.

Downstream: Application Market

1. Power Batteries (Largest Growth Driver)

Approximately 62% of the market

2. Energy Storage Batteries (Second Growth Curve)

Rapidly growing to around 25%

3. Consumer Batteries

Used in portable electronics and consumer devices.

Figure 2: Core Manufacturing – The "Four Key Materials" and the Birth of a Battery Cell

1. Cathode Materials (Source of Energy)

Lithium salts (lithium carbonate / lithium hydroxide)
→ Synthesis process
→ Cathode materials such as:

High-nickel ternary materials (NCM811)

Lithium iron phosphate (LFP)

Current technology trends are moving toward higher nickel content for higher energy density.

2. Anode Materials (Lithium Storage Host)

Natural graphite

Artificial graphite

Future evolution trend:

Silicon-carbon composite materials

3. Separator (Safety Barrier)

Two main types:

Wet process separators (thinner, better performance)

Dry process separators (lower cost)

4. Electrolyte (Ion Transport Medium)

Electrolytes are formed by mixing:

Solvents

Lithium salts

Additives

5. Cell Manufacturing Process

Key steps include:

Mixing
→ Coating
→ Calendering
→ Stacking or winding
→ Electrolyte filling
→ Sealing and packaging

This provides the medium for lithium-ion transport between electrodes.

Figure 3: Application Drivers and Green Closed-Loop System

Application Market Drivers

Application Market Drivers

Electric Vehicles (Power Batteries)

Lithium battery demand is strongly driven by the new energy vehicle industry.

Battery types include:

High-end vehicles: Ternary lithium batteries

Entry-level vehicles: Lithium iron phosphate batteries

Energy Storage Systems

Major categories include:

Utility-scale storage (power generation side)

Commercial & industrial energy storage

Residential energy storage

Consumer Electronics and Emerging Fields

Applications include:

3C electronics products

Drones

Low-altitude economy industries

Circular Recycling Industry Chain

Retired batteries enter the recycling chain:

Used batteries
→ Second-life applications (energy storage, low-speed electric vehicles, etc.)
→ Material recycling

Recycling processes include:

Dismantling

Hydrometallurgy / Pyrometallurgy / Mechanical processes

These processes recover valuable metals such as:

Lithium

Nickel

Cobalt

Recovered materials are then reused to produce cathode materials, forming a closed-loop cycle:

Resources → Products → Recycling → Regenerated Resources

This establishes a sustainable circular ecosystem for the lithium battery industry. 🔋🌱