Price Surge! Wet Membrane May Accelerate Industry Mergers & Acquisitions (M&A)

The price increase wave in the lithium battery industry chain continues to spread. Lithium carbonate prices are rising, lithium hexafluorophosphate prices are rising, and separators are also increasing in price!At the beginning of December, a leading domestic diaphragm company issued a price adjustment notice, stating, "Recently, due to the rise in upstream raw material costs for battery diaphragms and changes in the market supply and demand structure, our company is facing significant cost pressure," and announced that it would...The selling price of wet process separator products has been increased by 30%.

Another leading diaphragm manufacturer also stated that the price of the company's diaphragm products is determined by supply and demand as well as the performance of the products themselves. The company, under conditions of high capacity utilization, will...According to market conditions, appropriately communicate with downstream customers regarding products with significant price reductions in the previous period.At the same time, strive to ensure the demand and stable supply of high-quality diaphragms for downstream customers.

On December 15, industry data showed that the price of wet process base film (7μm) was 0.74-0.85 yuan/square meter, with an average price of 0.8 yuan/square meter; the price of wet process base film (5μm) was 1.22-1.52 yuan/square meter, with an average price of 1.37 yuan/square meter.Wet coating (5μm+2μm) is quoted at 1.52-1.83 RMB/square meter, with an average price of 1.68 RMB/square meter.The price of dry process base film (12μm) is quoted at 0.41-0.49 yuan/square meter, with an average price of 0.45 yuan/square meter; the price of dry process coating (12μm+4μm) is quoted at 0.75-0.84 yuan/square meter, with an average price of 0.8 yuan/square meter.

The supply-demand mismatch in the separator sector has improved to some extent. According to domestic separator manufacturers, the overall industry demand, particularly for energy storage, has been relatively strong this year, leading to a high overall capacity utilization rate in the industry. The current supply-demand situation in the industry helps separator companies optimize their customer structure and enhance their own profits.

As the price of membranes starts to rise, industry analysts believe that the sector is likely to reverse the widespread losses previously caused by price wars, gradually shifting towards pursuing reasonable profitability.The wet-process separator sector is currently experiencing a new wave of mergers and acquisitions, with leading companies integrating resources and optimizing capacity layouts.The acceleration in market concentration is being driven, leaving small and medium-sized manufacturers facing the pressure of being eliminated or merged. This market adjustment may propel the industry towards a "the strong get stronger" pattern.

Price recovery is healthy.

In the past two years, due to the mismatch of market supply and demand and price competition, the performance of diaphragm manufacturers has generally been under pressure.As of the first three quarters of 2025, many diaphragm manufacturers are still experiencing revenue growth without profit growth.According to the data, Enjie Co., Ltd. reported operating revenue of 9.543 billion yuan, a year-on-year increase of 27.85%; the net profit attributable to shareholders was -863.23 million yuan, a year-on-year decrease of 119.46%. Xingyuan Material reported operating revenue of 2.958 billion yuan, a year-on-year increase of 13.53%; the net profit attributable to shareholders was 114 million yuan, a year-on-year decrease of 67.25%.

Under unfavorable circumstances, the expansion efforts of companies in the industry have also noticeably weakened. In August of this year, Changyang Technology announced that the company...The "Annual production of 650 million square meters of lithium battery separators for energy storage and power batteries project" will be changed to the "Annual production of 350 million square meters project."The "annual production of 400 million square meters of lithium battery separators for energy storage and electric vehicles project" will be changed to "annual production of 200 million square meters project."

"In the process of advancing the aforementioned projects, the price of lithium battery separators continued to decline. The lithium-ion battery separator projects that the company has completed construction on have experienced significant losses in 2024, with gross profit margins not meeting expectations, thus prompting the aforementioned adjustments," Changyang Technology candidly stated.

For diaphragm manufacturers, price increases are the key to achieving a performance turnaround. In fact, prior to the recent price hike of wet-process diaphragms, price increases for dry-process diaphragms were already in the making. Xingyuan Materials mentioned that by the end of 2024, companies in the industry had organized a meeting to counteract the internal competition in the dry-process diaphragm sector, and a price increase of nearly 30% was achieved in the first half of 2025. By August 2025,The dry separator industry companies are once again discussing anti-involution, and it is expected that the prices of dry separators will likely rise further in the future.

"Price increases are expected to help companies turn losses into profits, improve cash flow pressures, and reflect an enhancement in their pricing power." Industry analysts believe that the prices of diaphragm products are likely to gradually recover to a healthier level in the future. On one hand, this is due to the cautious expansion of the industry, and on the other hand, as downstream demand continues to increase, the industry's capacity utilization rate is steadily improving. Against the backdrop of an improved supply-demand structure, product prices and profitability will also steadily return to a more reasonable level in the manufacturing sector.

Further enhancement of concentration.

The demand for downstream new energy vehicles and energy storage is strong.In the first three quarters of 2025, the domestic diaphragm shipment volume reached 22 billion square meters, a year-on-year increase of over 40%.Compared to dry-process membranes, wet-process membranes have advantages such as uniform pore distribution, better wettability with electrolytes, lightweight, and resistance to tearing. Industry institutions predict that by 2025, the total demand for membranes in the battery market will reach 30-32.5 billion square meters.The wet-process separator will reach 24-26 billion square meters, with a market share as high as 80%.

Nowadays, wet process separator manufacturers are operating at full capacity. According to industry statistics, the capacity utilization rate of leading wet process separator manufacturers has already been maintained at full production levels.The overall capacity utilization rate of the wet diaphragm industry has reached over 90%.Meilian New Materials disclosed that as of September this year, the sales volume of wet-process separators by its holding subsidiary, Anhui Meixin, had increased fourfold year-on-year.

As the largest wet diaphragm manufacturer in the industry, Enjie Co., Ltd. has revealed that the company currently has a substantial backlog of orders and a high capacity utilization rate. At the same time, the demand and orders from the company's downstream customers have shown a stable growth trend. Based on the strong demand for energy storage in the downstream market, it is expected that the company's shipment volume will further increase by 2025.

Various manufacturers are actively increasing their investment in the layout of wet process separators, and industry mergers and acquisitions continue to take place.

This November,Enjie Co., Ltd. announced that it plans to acquire 100% equity of Zhongke Hualian through the issuance of shares.Zhongke Hualian's main business includes wet-process PE diaphragms, BOPET, PI diaphragms, proton exchange membranes, and complete production equipment for new materials. If this acquisition proceeds smoothly, it will enhance Enjie Technology's synergistic capabilities in the wet-process diaphragm industry chain.

This December,Foshan Plastics Group Co., Ltd. announced that it plans to acquire 100% equity of Jinli Co., Ltd. for a total consideration of 5.08 billion yuan.Jinli Co., Ltd. specializes in wet process base membranes and coated separators, capable of stable mass production of ultra-thin high-strength separators of 5μm and below. In 2024, it will...The market share of the domestic wet diaphragm market has reached 18%, ranking second in the industry.

Currently, the diaphragm industry has entered a new stage of market competition. Industry analysis suggests that due to the lack of expansion confidence and capability among small and medium-sized enterprises, future supply-side increments will mainly concentrate on leading companies, and the industry's concentration is expected to further increase. At the same time, the trend of price increases will accelerate the exit of backward production capacity within the industry. Against this backdrop, technological barriers and economies of scale will become the core elements of competition.