Due to Increasing ESS Demands

The import of lithium-ion secondary batteries emerging as a future major export item for Korea increased more than 70% for the second consecutive year. It is pointed out that in terms of battery technology competitiveness, Korea is at the top level in the
The import of lithium-ion secondary batteries emerging as a future major export item for Korea increased more than 70% for the second consecutive year. It is pointed out that in terms of battery technology competitiveness, Korea is at the top level in the

 

The import of lithium-ion secondary batteries emerging as a future major export item for Korea increased more than 70% for the second consecutive year. It is pointed out that in terms of battery technology competitiveness, Korea is at the top level in the world but cost competitiveness such as labor cost enables China to outclass Korea, giving rise to an increase in Korea’s battery imports.

According to the Korea International Trade Association (KITA)'s total imports and exports of major items on March 20, Korea’s cumulative lithium ion battery exports and imports amounted to 657.59 million and 158.53 million US dollars, respectively. Compared with the same period of last year, exports spiked 25.7% and imports 74.2%, respectively.

The growth of lithium ion battery imports has outweighed the growth of exports since last year. In 2017, exports of lithium-ion batteries reached US$ 3,517.63 million, an increase of 51.1% from the previous year, and imports of them US$ 671.05 million, up 70.1%. Exports have increased every year except for 2015, and imports have soared since 2017 after falling since 2013.

The battery industry attributed the big spike in battery imports to the fact that imports of batteries from Chinese factories of Samsung SDI and LG Chem inflated thanks to a rise in demand for energy storage systems (ESSs) in Korea.

In this regard, market researcher SNE Research estimated that the Korean ESS market grew 388% over the previous year to 1.3GWh. The Ministry of Trade, Industry and Energy also expected that the Korean ESS market would reach 500 billion won by 2020.

The government is encouraging the spread of PV + ESS linkage solutions such as granting a REC weight of 5.0 for electricity produced by installing ESSs in solar power plants by revising the Notification of RPS (Mandatory New and Renewable Energy) system in September 2016. Moreover, as sales of electric cars have been on a steady rise, the Korean battery market is continuing to grow with mid- to large-sized batteries taking the lead.

However, as Korean battery makers are planning to expand their production facilities mainly in overseas factories, there is a big possibility that Korea will continue to import batteries made overseas by Korean companies.

Samsung SDI and LG Chem have no plan to expand their battery production facilities except for the expansion of production facilities for cathodes which are battery materials at domestic plants. Instead, Samsung SDI plans to start a battery plant in Hungary for the first half of this year, and LG Chem is also scheduled to start expanding its battery plant in Michigan of the US.

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