Executive Interviews

Asian Metal: Welcome, Mr. Yan, and thank you for accepting Asian Metal’s exclusive interview. Please briefly introduce the basic situation of your company.

Mr. Yan: Hunan Keyking Recycling Technology Co., Ltd. was established in May 2016. We specialize in the disposal and recycling of waste lithium-ion batteries, power batteries, lithium-containing waste materials, and nickel-cobalt waste materials. We are a National High-Tech Enterprise and a National Specialized, Sophisticated, Distinctive, and Innovative (SSDI) “Little Giant” Enterprise. The company currently operates two production bases in Leiyang and Changsha. The Leiyang base has a planned investment of 3 billion yuan, while the Changsha base has a planned investment of 5 billion yuan. Their planned annual production capacities are 25,700t and 30,000t of lithium carbonate, respectively, along with by-products such as lithium iron phosphate, nickel sulfate, cobalt sulfate, and manganese sulfate. The company holds 76 authorized patents, with an annual increase of about 15 patents. In 2021, the company was included in the Ministry of Industry and Information Technology’s White List of enterprises meeting the Industry Standard Conditions for the Comprehensive Utilization of Waste Power Batteries from New Energy Vehicles.

Asian Metal: What are the main raw materials for your company’s nickel sulfate production? Facing high cost pressure this year, how do the quality and cost compare between products produced from MHP and those purified from waste materials?

Mr. Yan: Most of our nickel sulfate products come from the recycling and extraction of ternary (NCM/NCA) waste materials. This ensures that the company does not rely entirely on imported ore resources, achieving true green recycling. Compared with MHP, products purified from waste materials have an “inherent consistency advantage.” Since waste batteries themselves are manufactured to high standards, their metal composition is relatively pure. Through our advanced multi-stage purification process, the resulting battery-grade nickel sulfate demonstrates superior impurity control—especially for trace magnetic substances—compared with conventional ore-based processing. In terms of cost, the current purchase coefficient for MHP remains around 0.88, while that for waste materials is only about 0.80. Using waste materials can save approximately RMB11,000/t in production costs. By “substituting waste for ore,” the company is able to maintain a higher gross profit margin.

Asian Metal: It is reported that your company’s ternary extraction workshop has achieved a highly automated “silent production” model. What specific cost and quality advantages does this intelligent manufacturing and process innovation bring?

Mr. Yan: The “silent production” and intelligent manufacturing model in the ternary extraction workshop essentially transform production from a “craft” reliant on individual experience into a “precision science” driven by data and models. The advantage it brings is not limited to a single reduction in cost or improvement in quality. Instead, it establishes a manufacturing system characterized by high stability, high efficiency, high flexibility, traceability, and continuous optimization. This enables the company to attract high-end customers in the competitive power battery materials market with lower costs and superior, more stable quality, forming a strong technological and process barrier.

Asian Metal: What is the current supply situation for waste batteries? Is the supply stable and sufficient, and what are your company’s subsequent plans in this regard?

Mr. Yan: Our current raw material supply is relatively stable. We have established a dual-driven supply system. First, we have long-term and stable supply agreements with partner traders. Second, we provide toll processing services for leading domestic battery manufacturers, which not only secures a stable source of waste materials but also deeply integrates us into the core power battery supply chain. In the future, we will further develop the “closed-loop recycling” model by establishing strategic partnerships with more vehicle manufacturers and battery companies to build an internal industrial cycle covering “scrapping – recycling – remanufacturing.”

Asian Metal: Since Q4 2025, nickel sulfate prices have fallen and then rebounded strongly. What do you think are the main reasons? What is the key factor determining future price trends, and what is your forecast for Q1 2026 prices?

Mr. Yan: We believe the recent rebound in nickel prices is mainly driven by adjustments and tightening expectations regarding Indonesia’s RKAB (Mining Business License) quota policy for nickel ore. This affects the global nickel balance at the source, leading to a strong underlying increase in nickel sulfate raw material costs in Q4. The key factor determining future price trends lies in the sustainability of Indonesia’s policy direction and the pace at which global refined nickel inventories are absorbed. We expect prices in Q1 2026 to fluctuate at relatively high levels or operate with a firm bias. I anticipate that nickel sulfate prices will remain within the range of RMB30,800-35,000/t. Expectations of quota reductions in Indonesia will continue to provide fundamental support for prices.

Asian Metal: Under the continuous impact of LFP batteries, what is the current market status and market share of ternary batteries? Do you think they will be replaced?

Mr. Yan: Currently, the market share of ternary batteries and LFP batteries is roughly 30% to 70%. However, we do not believe ternary batteries will be replaced. While LFP batteries dominate the mid-to-low-end and energy storage markets, ternary batteries have irreplaceable advantages in mid-to-high-end new energy vehicles, ultra-long-range applications, and cold regions due to their higher energy density. In the future, ternary batteries are accelerating their evolution toward higher nickel content, semi-solid-state, and even all-solid-state technologies. These advanced technology routes will not reduce demand for nickel sulfate; on the contrary, they require even higher purity and consistency. With the development of solid-state batteries, the market share of ternary batteries may further increase and could potentially become dominant.

Asian Metal: What was the national production of battery-grade nickel sulfate in 2025 relative to industry demand? Was there a supply gap, and what is the future growth rate?

Mr. Yan: Although China’s battery-grade nickel sulfate production remained high in 2025, the market was in a state of temporary tight balance due to disruptions on the raw material side, such as Indonesian intermediates being diverted to nickel cathode production. With the increasing penetration of high-nickel battery models, we expect demand for nickel sulfate to maintain a steady annual growth rate of over 20%.

Asian Metal: In your view, what will be the biggest challenge and the biggest opportunity facing China’s power battery recycling and nickel sulfate industry over the next two to three years, and how will your company respond?

Mr. Yan: In the past, the industry suffered from a phenomenon of “bad money driving out good,” where informal channels, due to the absence of environmental and compliance costs, could often offer higher prices to seize raw materials. With the recent release of the Interim Measures for the Administration of Recycling and Comprehensive Utilization of Waste Power Batteries from New Energy Vehicles, which mandate the establishment of a “digital ID card” for power batteries and a full lifecycle traceability platform, enterprises will face increased investment in digital management and carbon footprint accounting. At the same time, price volatility in bulk commodities such as nickel and lithium places extremely high demands on inventory management and market strategy judgment. The concept of “vehicle-and-battery integrated scrappage” will effectively close previous leakage loopholes. The new regulations clearly stipulate that scrapped new energy vehicles must be scrapped together with their power batteries, strictly prohibiting batteries from being separated and flowing into illegal dismantling channels. This will accelerate the concentration of retired batteries toward qualified and compliant enterprises, fundamentally resolving past pain points such as material shortages and sourcing difficulties. Meanwhile, the new regulations strengthen the extended producer responsibility of vehicle manufacturers. As a company with core technologies and White List qualifications, we will become a preferred partner for vehicle manufacturers to fulfill their responsibilities and achieve carbon neutrality goals. Moreover, the period from 2026 to 2028 will coincide with the first wave of large-scale power battery retirement in China, with an estimated annual volume exceeding 400,000t, indicating enormous incremental growth potential for the industry.

Asian Metal: Your company has recently announced expansion plans in both Leiyang and Wangcheng. Could you elaborate on the strategic considerations behind increasing nickel sulfate production capacity?

Mr. Yan: Following the expansion and renovation of the Leiyang base, the annual production capacity of battery-grade nickel sulfate, cobalt sulfate, and manganese sulfate will increase to 68,000t, enabling cost reductions through economies of scale. The Wangcheng base is more focused on cutting-edge technology transformation and high-end product matching, leveraging the advantages of the Changsha new energy materials industry cluster to achieve close synergy between R&D and production.

Asian Metal: What are the company’s development plans in 2026?

Mr. Yan: In 2026, the capacity utilization rate of the two new production lines—ternary and LFP—is expected to reach 70%–80%. After full ramp-up, they are projected to generate an annual output value of approximately 4 billion yuan. This will effectively optimize the company’s product structure and significantly enhance its resilience to market fluctuations and operational risks.

Asian Metal: Thank you, Mr. Yan, for accepting this interview. We wish your company continued success in the coming year.

Mr. Yan: Thank you, Asian Metal.