From December 25 to 26, Hunan Yuneng, WANRUN NEW ENERGY, Dynanonic, and Anda Technology successively disclosed maintenance and production reduction plans for their lithium iron phosphate enterprises. The maintenance and production reduction period is concentrated in January 2026, lasting for one month.
According to Shanghai Securities Journal, the four companies cover approximately 50% of the lithium iron phosphate market share, with three of them disclosing production reduction amounts corresponding to a reduction of about 35% to 50% in January. Their collective production cuts are expected to have a significant impact on the supply and demand pattern in January.
Lithium iron phosphate enterprises are at a critical point in negotiating price increases with downstream battery manufacturers. An industry insider close to one of the aforementioned listed companies told Shanghai Securities Journal that feedback from downstream has not yet been received regarding the production reduction plan, &#34;However, it may be difficult for battery companies to accept a corresponding production reduction of 50%.&#34;
<h2>Four Production Reduction Enterprises Control Nearly Half of the Market Share</h2>
On the evening of December 25, Hunan Yuneng announced that its capacity utilization rate has exceeded 100% since the beginning of the year. To maintain normal equipment operation and ensure safe and stable production, as well as to guarantee product quality, the company plans to conduct maintenance on some production lines starting from January 1, 2026, for an estimated duration of one month. This maintenance is expected to reduce the company's phosphate cathode material product output by 15,000 to 35,000 tons, and is not expected to have a significant impact on the company's operating performance in 2026.
On the same evening, WANRUN NEW ENERGY announced that starting from December 28, 2025, the company will conduct production reduction maintenance on some production lines according to the planned schedule, with an estimated maintenance duration of one month. This partial production line maintenance is to ensure the continuous and stable operation of the lithium iron phosphate production line, and it is expected to reduce the company's lithium iron phosphate output by 5,000 to 20,000 tons, with no significant impact on the company's production and operations expected.
Before the market opened on December 26, Dynanonic announced that it would conduct maintenance on some production lines according to the established plan and carry out technical upgrades on some equipment to achieve optimal operating levels. The maintenance period will start from January 1, 2026, and is expected to last for one month. It is not expected to have a significant impact on the company's operating performance in 2026.
Affected by the production reduction news from the three companies, the lithium iron phosphate sector surged on the 26th, with WANRUN NEW ENERGY rising by 7.56%, Hunan Yuneng by 6.49%, Dynanonic by 3.91%, Anda Technology by 3.38%, Longpan Technology by 2.14%, and Fulian Precision by 1.57%.
On the evening of December 26, Anda Technology also disclosed an announcement regarding maintenance on some production lines. The company stated that since the fourth quarter of 2025, the lithium iron phosphate production line has been operating at full capacity. To ensure the safe, stable, and efficient operation of the lithium iron phosphate production line, starting from January 1, 2026, the company will conduct maintenance on some production lines according to the planned schedule, with an estimated maintenance duration of one month. The maintenance is expected to reduce the company's lithium iron phosphate output by 3,000 to 5,000 tons, with no significant impact on the company's production and operations expected.
Gaogong Lithium Battery Analysis stated that Hunan Yuneng, Dynanonic, and WANRUN NEW ENERGY together occupy nearly half of the lithium iron phosphate industry's market share, and this short-term production reduction will change the current supply and demand pattern in the industry
According to the November market share statistics for lithium iron phosphate companies released by Zeyan Consulting, the three companies mentioned, along with Andar Technology, account for nearly half of the market share.
<img src="https://imageproxy.pbkrs.com/https://mmbiz-qpic.wscn.net/sz_mmbiz_png/xbUOr6jbzYJLPopD9icY9EQQlPtiad4xsPw1UnVAP2yVVRhQiaBcb63FPLudVh93HicRQnGnojoyALyp6LibFtyvHjA/640/query-ZnJvbT1hcHBtc2cmd3hfZm10PXBuZw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://mmbiz-qpic.wscn.net/sz_mmbiz_png/xbUOr6jbzYJLPopD9icY9EQQlPtiad4xsPw1UnVAP2yVVRhQiaBcb63FPLudVh93HicRQnGnojoyALyp6LibFtyvHjA/640/query-ZnJvbT1hcHBtc2cmd3hfZm10PXBuZw"/>
The aforementioned lithium iron phosphate industry insiders told Shanghai Securities Journal that some non-listed lithium iron phosphate companies have also joined the production reduction plan.
It is estimated that this round of production reduction covers about half of the market, or perhaps more.
In terms of the reduction scale, the three listed companies that disclosed their production reduction amounts are expected to reduce production by approximately 35% to 50% in January. A brokerage analyst tracking the situation stated that Hunan Yuneng's production reduction plan is expected to decrease the company's lithium iron phosphate output by 15,000 to 35,000 tons, accounting for up to 35% of its capacity; WANRUN NEW ENERGY's production reduction plan is expected to decrease the company's lithium iron phosphate output by 5,000 to 20,000 tons, accounting for up to 50% of its capacity.
<h2>Rising Raw Material Prices Intensify Losses, Strong Willingness to Raise Prices Among Lithium Iron Phosphate Companies</h2>
The timing of this industry-wide concentrated maintenance and production reduction coincides with a critical period for lithium iron phosphate companies negotiating price increases with downstream battery manufacturers, reflecting the strong motivation of lithium iron phosphate companies to maintain prices.
Regarding the reasons for the production reduction, the aforementioned lithium iron phosphate industry insiders told Shanghai Securities Journal: &#34;Currently, the lithium iron phosphate industry is still in negotiations with major downstream battery customers. There are two main reasons for the production reduction: first, the skyrocketing price of lithium carbonate has put significant pressure on operations; second, the base price continues to incur losses, with upstream phosphate prices and iron source prices continuously soaring, and customers are unwilling to accept price increases, making operations unsustainable.&#34;
As for the effectiveness of the production reduction in maintaining prices, the insider stated that they have not yet received feedback from downstream, &#34;However, battery companies may find it difficult to accept a corresponding production reduction of 50%.&#34;
The aforementioned brokerage analyst believes that production stoppages serve as leverage for maintaining prices, and price maintenance is an inevitable trend. From a supply and demand perspective, leading lithium iron phosphate companies are operating at full capacity, and most second-tier companies are also at full capacity, but second-tier companies are still generally operating at a loss. On the cost side, prices for lithium carbonate, phosphate, monoammonium phosphate, and ferrous sulfate have all increased in the fourth quarter, intensifying operational pressure. In terms of pricing, the bidding and negotiation rhythm of some major customers has a significant lag. Against the backdrop of high operating rates (an indicator measuring the efficiency of equipment in creating value during available time), the joint production reduction by lithium iron phosphate companies demonstrates a united stance, making price maintenance an inevitable trend.
Data shows that although market demand has significantly improved and companies' operating rates have returned to prosperous levels, most lithium iron phosphate companies are still producing at a loss.
According to data from the China Chemical and Physical Power Industry Association, the average market price of lithium iron phosphate in November was 14,704.8 yuan/ton, while industry costs ranged from 16,798.2 yuan/ton to 17,216.3 yuan/ton
<img src="https://imageproxy.pbkrs.com/https://mmbiz-qpic.wscn.net/sz_mmbiz_png/xbUOr6jbzYJLPopD9icY9EQQlPtiad4xsPgWSw0NwHg9sgwQdaczeFFoQDsnBepymyDq0tlMA2c17SvTIxXA22Pg/640/query-ZnJvbT1hcHBtc2cmd3hfZm10PXBuZw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://mmbiz-qpic.wscn.net/sz_mmbiz_png/xbUOr6jbzYJLPopD9icY9EQQlPtiad4xsPgWSw0NwHg9sgwQdaczeFFoQDsnBepymyDq0tlMA2c17SvTIxXA22Pg/640/query-ZnJvbT1hcHBtc2cmd3hfZm10PXBuZw"/>
Source: China Chemical and Physical Power Industry Association
Data from the China Chemical and Physical Power Industry Association also indicates that the gap between selling prices and costs in November further widened compared to October.
<img src="https://imageproxy.pbkrs.com/https://mmbiz-qpic.wscn.net/sz_mmbiz_png/xbUOr6jbzYJLPopD9icY9EQQlPtiad4xsPyJ8icYxS5iaYnMEQYgRaGON4TQxD4mlxqiciaKQvyOF8JdegTT8ub7S7Jg/640/query-ZnJvbT1hcHBtc2cmd3hfZm10PXBuZw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://mmbiz-qpic.wscn.net/sz_mmbiz_png/xbUOr6jbzYJLPopD9icY9EQQlPtiad4xsPyJ8icYxS5iaYnMEQYgRaGON4TQxD4mlxqiciaKQvyOF8JdegTT8ub7S7Jg/640/query-ZnJvbT1hcHBtc2cmd3hfZm10PXBuZw"/>
Source: China Chemical and Physical Power Industry Association
The third quarter financial reports show that most lithium iron phosphate companies are in a state of loss.
<img src="https://imageproxy.pbkrs.com/https://mmbiz-qpic.wscn.net/sz_mmbiz_png/xbUOr6jbzYJLPopD9icY9EQQlPtiad4xsPvtSRU2nhtSWOF1rOmwNybnkicX50AVHGs3ibO6Npt8hY6LVoUicFoLhxg/640/query-ZnJvbT1hcHBtc2cmd3hfZm10PXBuZw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://mmbiz-qpic.wscn.net/sz_mmbiz_png/xbUOr6jbzYJLPopD9icY9EQQlPtiad4xsPvtSRU2nhtSWOF1rOmwNybnkicX50AVHGs3ibO6Npt8hY6LVoUicFoLhxg/640/query-ZnJvbT1hcHBtc2cmd3hfZm10PXBuZw"/>
Data Source: Choice
This article is sourced from: Shanghai Securities Journal
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Yuneng New Energy, WANRUN NEW ENERGY, Dynanonic, and Anda Technology, four lithium iron phosphate companies, plan to conduct a month-long maintenance and production reduction starting in January 2026, affecting approximately 50% of the market share. The reduction is expected to be between 35% and 50%, which may impact the supply and demand dynamics in January. This move comes at a critical moment for negotiations with downstream battery manufacturers regarding price increases. As a result of the production reduction news, the stock prices of the related companies have risen

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