The rise in copper foil prices reflects industry shifts: AI and new energy are reshaping demand markets, with technological innovation becoming the key to success.

Ask AI · Why does the copper foil price increase only benefit technologically advanced companies?

On an ordinary workday in March, a piece of news from the lithium battery copper foil industry spread across the market: DeFu Technology confirmed that it will raise processing fees for some battery customers. This means the industry has shifted from the price slump of the past two years toward value recovery.

“This is a crucial turning point from expectation to execution,” a market analyst noted. “It means that bargaining power along the industry chain is starting to move upstream toward material suppliers, and the recovery of processing fees will become the core driver of leading companies’ performance improvement this year.”

However, this is not a universal industry-wide recovery, but a structural divergence in the sector. After researching, the author found that this round of price recovery shows distinct structural characteristics and is deeply intertwined with the wave of global technological change. Against this backdrop, the author visited Gansu Hailiang New Materials, a controlling subsidiary under Hailiang Co., Ltd. (002203), to explore how—amid industry differentiation—companies can seize development opportunities by relying on their technological strength.

Demand Differentiation and Supply Constraints

“This price increase covers all series of lithium battery copper foil, and the company has already raised the prices of electronic circuit copper foil,” DeFu Technology’s description reveals two major drivers behind the price increase: new energy and AI computing power.

In the new energy sector, the “ultra-thinning” trend for power batteries is clear. Industry data shows that 6μm products have become a standard entry-level offering, while demand for ultra-thin copper foil in the 4.5μm–5μm range is growing rapidly. On the other hand, the adoption of energy storage batteries is driving market demand for long-life, high-cycle differentiated products.

Even more explosive is the new demand brought by AI. As the number of layers in AI server PCB boards increases significantly, demand for high-performance copper foil surges. A person in charge of related procurement admitted, “This is completely a technology-driven new market, and there are only a limited number of companies in China that can supply stably.”

On the supply side, there are rigid constraints. The copper foil industry requires large investments and long construction cycles, and customer certifications take time—leading companies to expand capacity cautiously. Although the industry’s overall capacity utilization rate is expected to improve this year, there is still a gap in high-end capacity.

“Value differentiation is being brought about by technological stratification,” industry experts pointed out. “The price-increase dividend is first captured by companies that have the mass production capability for high-end products.”

Forward-Looking Deployment and Manufacturing Upgrades

Amid the structural differentiation of the industry, the growth path of Hailiang New Materials is quite representative. The company has not fallen into low-end competition; instead, it has focused resources on the technological high ground.

First, it targets the next-generation battery technology. At the R&D center, technical staff presented solutions to bottlenecks in solid-state batteries. “Sulfide electrolytes will corrode copper foil, which is a tough industry problem. We form a protective layer on the surface of the copper foil by using special high-corrosion-resistant coating/coating technologies, effectively improving the stability of the interface.” said Dr. Luo Chong, General Manager of the Hailiang Copper Foil business unit. At present, the related products have entered the R&D systems of leading battery companies.

Second, it builds extreme manufacturing capability. Hailiang New Materials has creatively designed an industry-leading digital intelligent workshop, introducing advanced software and hardware platforms into core processes such as copper melting, liquid preparation, foil rolling, aging, slitting, and packaging and putting into storage. This effectively enhances consistency across production processes. One roll of copper foil is 54,000 meters long; to achieve zero-defect deliveries, it is necessary to rely on end-to-end digital management. This process stability is the foundation for earning the trust of high-end customers.

“We are currently in the deep waters of the transformation of new energy materials. From the surface, copper foil products are being differentiated, but the underlying logic is actually a game of transformation in downstream battery technology—pushing copper foil from the past ‘general commodity products’ toward ‘functional customization,’” Dr. Luo Chong said. Specifically, the core logic behind technological iteration in Hailiang copper foil is to closely follow downstream technology routes, match the needs of battery manufacturers, and design high-performance products with targeted specifications according to demand.

From Price Recovery to Value Growth

Although the signals of price increases are clear, the industry still keeps watching whether the trend is sustainable. Analysts believe that the current recovery is still structural, and a comprehensive improvement requires continued validation of downstream demand.

The real challenge for the industry lies in how to convert the short-term “price recovery” into long-term “value growth.” This requires companies to have continuous innovation capabilities and a global operational perspective.

In terms of technological innovation, Hailiang New Materials’ plans have been extended to 2028–2030, targeting the commercialization window for all-solid-state batteries. In its manufacturing layout, the company leverages the advantages of green electricity in Gansu, and at the same time deploys overseas bases to meet international market requirements. This enables the company to ensure stable production in extreme scenarios and also to respond to trade barriers such as the EU’s carbon tariffs, adding an additional layer of safety buffer for the industry chain.

“The competitive logic in the industry is changing,” an investment professional said. “In the past, people focused on capacity and cost; now we need to look more at technological reserves, customer relationships, and global deployment. Companies like Hailiang that have forward-looking layouts in key materials are gaining a new valuation logic.”

The author’s observation:

The increase in lithium battery copper foil processing fees has opened the prelude to a new stage in the industry. This is no longer a story of homogeneous expansion, but a deeper competition centered on technological stratification, customer binding, and global operations.

In this process, the key to winning is not simply the size; it is whether a company can find the right positioning amid technological change, and whether it has the ability to transform innovation into high-quality products.

The practice of Gansu Hailiang New Materials shows that China’s materials companies are undergoing a role transition from “catching up” to “running in parallel,” and even to “leading.” When the tide of industry adjustments finally recedes, the companies that will be able to grow sustainably will inevitably be those that deeply embed technology into the future of the industry. This competition centered on technological strength has only just begun. (Information)

Editor: Kong Dexuan