Altech Chemicals Ltd (ASX:ATC) is an emerging high purity alumina (HPA) producer, with HPA demand for lithium-ion battery manufacture forecast to increase at 30% per year to 2025.
Therefore with demand forecast to increase from ~1,000tpa in 2016 to ~15,000tpa in 2025, this gives Altech a unique opportunity.
To supply another metric, this demand for 2025 is equivalent to four of Altech’s proposed HPA plants.
Iggy Tan, managing director, commented:
“HPA demand growth in the LED sector has long been acknowledged and understood; this growth is however now complemented by HPA demand growth in the lithium-ion battery industry, specifically from battery separator sheet manufacturers.
“The timing for construction of Altech’s proposed HPA plant in Malaysia appears perfect, with two parallel streams of near-term HPA demand growth now apparent.
"The important point is that we are entering a market showing high demand growth, Altech’s proposed production capacity should be easily absorbed without the need to fight for market share.”
The HPA demand forecast has been calculated based on lithium-ion battery manufacturing data recently published by Deutsche Bank.
The data predicts annual global demand for lithium-ion batteries will rise from 70 gigawatt-hours (GWh) per year in 2015 to 535GWh per year by 2025.
The company has applied reported HPA usage per kilowatt-hour in lithium-ion battery separators (a vital battery component) to calculate forecast global HPA demand for the lithium-ion battery manufacturing sector.
HPA and lithium-ion batteries
The major application of HPA in lithium-ion batteries is as a coating on the ceramic separator sheet that divides the cathode and anode electrodes within the battery.
HPA-coated separators withstand unusually high temperature incursions, increase battery separator shrinkage temperatures and reduce flammability during thermal runaways, and thus make lithium-ion batteries much safer.
HPA-coated battery separators also increase a battery’s discharge rate; lower self-discharge; and lengthen battery life cycles.
Electric vehicle manufacturers are increasingly demanding lithium-ion batteries with 99.99% (4N) HPA-coated separators.
American automotive company Tesla recently announced the 2018 launch of its lithium-ion battery manufacturing facility called “Gigafactory” in the U.S.
The name Gigafactory comes from the factory’s planned annual battery pack output capacity of 50GWh.
In co-operation with Panasonic and other strategic partners, the Gigafactory will reportedly produce batteries for significantly less cost using economies of scale, innovative manufacturing, reduction of waste, and the simple optimisation of locating most manufacturing processes under one roof.
Tesla expects to drive down the per kilowatt hour (kWh) cost of the battery pack by more than 30%.
By 2020, the Gigafactory will reportedly reach full capacity and produce more lithium-ion batteries annually than were produced worldwide in 2013.
Altech estimates that at its full production rate the Tesla Gigafactory will require around 2,020tpa of HPA for separator coatings, which is equivalent to half the output of the company’s proposed Malaysian HPA plant.
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