(Yicai Global) Dec. 8 -- Sunwoda Electronic, a Chinese supplier of lithium-ion battery cells and modules, said it will invest at least CNY16.5 billion (USD2.4 billion) in several lithium material projects in China’s Yichun, known as ‘Asia’s lithium capital,’ to ensure the supply of upstream lithium resources and cut the cost of raw materials.

Sunwoda signed a deal with the Yichun government to set up a joint venture company, in which the Shenzhen-based firm will own 65 percent, that will build and operate an industrial chain for the full life cycle of lithium battery raw materials, it said in a statement late yesterday.

The projects will include a battery-grade lithium carbonate plant with an annual capacity of 50,000 tons, a lithium battery cathode material facility with a 300,000 ton annual output, and a comprehensive recycling plant with a processing scale of 50 gigawatt-hours of waste batteries per year, Sunwoda said. It did not provide a construction schedule.

To ensure the supply of raw materials for the project, Sunwoda also plans to establish a JV with Yichun Mining, a local state-owned company with mining resources, to co-develop lithium mine projects.

Yichun, in China’s eastern Jiangxi province, has the world’s largest lithium mica mine. Its lithium oxide resources account for 31 percent of the country’s total and 12 percent of the global total. Before Sunwoda, Chinese lithium battery giants Contemporary Amperex Technology, BYD, and Volkswagen-backed Gotion Hi-Tech, as well as lithium battery materials supplier Ganfeng Lithium, have already announced huge investment plans in the city.

Some 133 lithium battery industry chain projects covering mine development, lithium salt and lithium material production, and battery production and recycling, are under construction in Yichun, with a total investment of CNY135.6 billion (USD19.5 billion), according to a press conference held by the local government in October. Fifty-one new projects were announced this year alone. Their total investment exceeds CNY160.7 billion.

Sunwoda’s stock [SHE: 300207] fell 0.5 percent today to close at CNY24.55 (USD3.52).

Editor: Futura Costaglione