Industry Value Chain

Profitability Has Been Redistributed Across The Value Chain NONINTEGRATED MIDSTREAM PRODUCERS FACE PROFITABILITY CHALLENGES Gross profit margin in 2024 Q2 and y/y change, %

Upstream miner and refinersʼ margins show significant divergence in 2024 as prices hit the cost levels of marginal producers. Battery producers continue to reap the benefits of falling raw material prices. While vertically integrated midstream producers can leverage profits from mining and refining to reduce p/CAM prices, non-integrated producers are suffering from the slowdown in demand for NMC and export customers, and are losing market share. They are increasingly reduced to a tolling role, with margins set by battery makers. LFP producers, especially non-integrated ones, are suffering higher losses due to the intense competition and strong bargaining power of battery producers. Chinese p/CAM and battery producers generally have higher margins than ex. China companies due to their cost competitiveness.

Source: Content & analysis provided courtesy of CRU Group Distinguished Partner). Profit margin data from CRUʼs compilation of company reports.

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