(Yicai Global) May 28 -- Shares of Tinci Materials Technology and Contemporary Amperex Technology rallied after the two Chinese companies deepened their cooperation with another large battery raw materials contract.

Tinci's stock price [SHE: 002709] surged as much as 10 percent to CNY88 (USD13.80), an all-time high.

CATL's shares [SHE: 300750] jumped 9.8 percent to CNY421.50 (USD66.10). Last January, the equity price soared to a historic high of CNY424.99.

Tinci's unit Kaixin Battery Material will provide CATL with electrolytes materials used in electric vehicle batteries, including 15,000 tons of lithium hexafluorophosphate, by June 2022, the Guangzhou-based supplier said in a statement yesterday. Prices are determined based on a benchmark. The battery maker will pay an advance of CNY675 million (USD106 million) to Kaixin. 

The two firms are familiar with each other. Last year, CATL bought CNY997 million worth of electrolytes from Tinci with increasingly big orders over the year. 

Lithium hexafluorophosphate is currently priced at between CNY270,000 and CNY310,000 (up to USD48,676) per ton, according to commodity information supplier Baiinfo. The prices have been surging more than 60 perfect since early March.

Kaixin is expanding production. Last July, the firm started building a plant in Ningde, CATL's home town, to produce 100,000 tons of electrolytes per year. The project should be ready after 12 months of construction.

Tinci, which counts Swedish battery maker Northvolt and BMW as some of its clients, is currently more than tripling its output to 456,000 tons of electrolytes. It held a 32 percent market share in China by December 2020, and a fifth of the global market share.

Editor: Emmi Laine, Xiao Yi