‘Lithium ion battery’ to boost export… Import increase rate to go up due to cost competition
Park Jung Il | comja77@ | 2018-03-21 11:28:50
The import of lithium-ion rechargeable batteries, which are emerging as future exporters, has increased more than 70% for the second consecutive year.
Korea is at the top level in the world, but the cost competitiveness such as labor costs can push China to increase battery imports in terms of technology competitiveness.
According to the Korea Trade-Investment Promotion Agency (KITA)`s total imports and exports on 20th of this month, the cumulative lithium ion battery (HS code 850760) exports amounted to 655.59 million dollars (about KRW 700 billion), compared with the same period last year, exports increased by 25.7% and imports increased by 74.2%.
On the other hand, the rate of increase in imports is higher than the rate of increase in exports from last year. Last year, exports of lithium-ion batteries reached USD 3,517.63 million, an increase of 51.1% from the previous year, and imports of USD 671.5 million, up 70.1%. Exports have increased every year except for 2015, and imports have been decreasing since 2013.
The reason for the surge in battery imports is that the increase in demand for ESS (power storage devices) in Korea has led to an increase in domestic imports of batteries from Samsung SDI and LG Chem.
In this regard, market researcher SNE Research estimates that the domestic ESS market has grown by 388% over the previous year to 1.3GWh, and the Ministry of Industry also expects the domestic ESS market to reach KRW 500 billion by 2020.
The government revised the Notification of RPS (Mandatory New and Renewable Energy) system to encourage the spread of PV + ESS linkage solutions by granting a REC weight of 5.0 for electricity produced by installing ESS in PV power plants in September 2016. As the sales volume of electric cars is steadily increasing, the domestic battery market is continuing to grow, centering on mid- and large-sized batteries.
However, the possibility of re-importing batteries made by domestic companies is likely to continue as domestic battery makers are planning to expand their production facilities mainly in overseas factories.
Samsung SDI and LG Chem have no plan to expand their battery production facilities beyond the expansion of cathode materials production facilities, which are battery materials at domestic plants. Instead, Samsung SDI plans to start a battery plant in Hungary for the first half of the year, and LG Chem is also scheduled to start expanding its battery plant in Michigan,
In the industry, domestic battery makers cited cost competitiveness, low incentives, and market uncertainty as reasons for the domestic capacity expansion.
An industry expert said, "The common strategy of domestic battery manufacturers is to develop new products and mass production only in Korea, and most of the general-purpose products are mainly produced in China and Europe. "It is true that there is no attractive factor to expand in Korea, although it is possible to receive incentive benefits from the local government."
By Park Jung Il comja77@
[ copyright ⓒ The Digitaltimes ]
Korea is at the top level in the world, but the cost competitiveness such as labor costs can push China to increase battery imports in terms of technology competitiveness.
According to the Korea Trade-Investment Promotion Agency (KITA)`s total imports and exports on 20th of this month, the cumulative lithium ion battery (HS code 850760) exports amounted to 655.59 million dollars (about KRW 700 billion), compared with the same period last year, exports increased by 25.7% and imports increased by 74.2%.
On the other hand, the rate of increase in imports is higher than the rate of increase in exports from last year. Last year, exports of lithium-ion batteries reached USD 3,517.63 million, an increase of 51.1% from the previous year, and imports of USD 671.5 million, up 70.1%. Exports have increased every year except for 2015, and imports have been decreasing since 2013.
The reason for the surge in battery imports is that the increase in demand for ESS (power storage devices) in Korea has led to an increase in domestic imports of batteries from Samsung SDI and LG Chem.
In this regard, market researcher SNE Research estimates that the domestic ESS market has grown by 388% over the previous year to 1.3GWh, and the Ministry of Industry also expects the domestic ESS market to reach KRW 500 billion by 2020.
The government revised the Notification of RPS (Mandatory New and Renewable Energy) system to encourage the spread of PV + ESS linkage solutions by granting a REC weight of 5.0 for electricity produced by installing ESS in PV power plants in September 2016. As the sales volume of electric cars is steadily increasing, the domestic battery market is continuing to grow, centering on mid- and large-sized batteries.
However, the possibility of re-importing batteries made by domestic companies is likely to continue as domestic battery makers are planning to expand their production facilities mainly in overseas factories.
Samsung SDI and LG Chem have no plan to expand their battery production facilities beyond the expansion of cathode materials production facilities, which are battery materials at domestic plants. Instead, Samsung SDI plans to start a battery plant in Hungary for the first half of the year, and LG Chem is also scheduled to start expanding its battery plant in Michigan,
In the industry, domestic battery makers cited cost competitiveness, low incentives, and market uncertainty as reasons for the domestic capacity expansion.
An industry expert said, "The common strategy of domestic battery manufacturers is to develop new products and mass production only in Korea, and most of the general-purpose products are mainly produced in China and Europe. "It is true that there is no attractive factor to expand in Korea, although it is possible to receive incentive benefits from the local government."
By Park Jung Il comja77@