by The battery materials market is witnessing increased adoption of sustainable materials and processes in lithium-ion battery production to meet the rising demand for energy-efficient batteries from the consumer electronics and automotive industries. Battery materials such as cathode materials, anode materials, electrolytes, and separators are critical components that influence the performance, life cycle, and safety of lithium-ion batteries. Cathode materials, in particular, account for over 35% of the total battery cost.
The Global Battery Materials Market is estimated to be valued at US$ 50.6 Bn in 2024 and is expected to exhibit a CAGR of 6.0% over the forecast period 2023 to 2030.
Lithium-ion batteries have emerged as the preferred power source for a variety of portable electronic devices and electric vehicles due to their high energy densities and longer lifespan compared to traditional battery chemistries. This growing adoption is propelling the demand for battery materials such as lithium, graphite, cobalt, and nickel. Manufacturers are continuously investing in R&D to develop more sustainable and cost-effective battery materials to meet the massive andcomplex global demand. For instance, natural graphite is increasingly being replaced by synthetic graphite anodes owing to their superior performance attributes. Similarly, alternatives to costly cobalt are gaining attention with lithium iron phosphate emerging as a viable cathode candidate.
Key Takeaways
Key players operating in the Battery Materials market are Albemarle, China Molybdenum Co. Ltd., Gan feng Lithium Co., Ltd., Glencore PLC, Livent Corporation, Norlisk Nickel, Sheritt International Corporation, SQM S.A., Targray Technology International Inc., Teck Resources, Tianqi Lithium, and Vale S.A. The battery materials industry is witnessing rapid consolidation as large players acquire smaller firms to gain critical expertise and expand globally. For instance, in 2021, Tianqi Lithium acquired a controlling stake in Albemarle’s lithium operations.
The strong demand for various types of batteries from consumer electronics and electric vehicles is propelling the need for battery materials. In particular, the accelerating sales of plug-in electric vehicles worldwide are creating a massive uptick in lithium-ion battery demand. It is estimated that an average EV requires 6 times as much lithium and graphite as a smartphone to power its batteries.
Battery material manufacturers are investing significantly in scaling up existing facilities and building new plants globally to meet this ballooning demand. For example, Albemarle and Livent have announced ambitious capacity expansion plans across Europe, Australia, and Chile to add over 100,000 tons per year of lithium carbonate and lithium hydroxide by 2025.
Market Key Trends
One of the primary trends in the battery materials industry is the increased focus on developing sustainable and ethically-sourced materials. This includes using more traceable and responsibly-mined resources, leveraging recycling to create circular supply chains, and innovating new chemistries that eliminate dependency on conflict minerals. For instance, Tesla inked a multi-year deal with Piedmont Lithium for sustainable spodumene concentrate to be used in battery cathodes. Similarly, cathode material startups such as Sila Nanotechnologies and Cape Town-based Q Silicon are engineering alternatives to graphite anodes using novel silicon-based structures. As the battery industry broadens its focus on environmental stewardship, more sustainable offerings are expected to gain notable traction among OEMs and consumers over the coming years.
Porter’s Analysis
Threat of new entrants: Low barrier for new small players to enter but high capital requirements to compete with top players globally.
Bargaining power of buyers: Buyers have moderate bargaining power as the market has few large buyers and substitutes are available.
Bargaining power of suppliers: suppliers have moderate bargaining power as raw materials have few substitutes and supply market is consolidated.
Threat of new substitutes: Threat of new substitutes is moderate as R&D brings new battery chemistries but commercialization takes time.
Competitive rivalry: Intense competition exists among top players to gain market share and compete on pricing, product innovation and supply contracts.
Geographical regions of concentration
The Asia Pacific region accounts for more than 50% of the global battery materials market value led by China, Japan, South Korea. This is due to strong manufacturing base of batteries and electric vehicles in these countries. China dominates cathode active material production as it hosts facilities of all major battery material producers.
Fastest growing region
Europe is witnessing the fastest growth in the battery materials market driven by electric vehicles adoption and energy storage policies of European governments. The region’s market is expected to grow at over 8% annually during 2023-2030 timeframe led by countries like Germany, France and United Kingdom. Investments are increasing in lithium mining and battery material production facilities to meet the growing regional demand.
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1.Source: Coherent Market Insights, Public sources, Desk research
2.We have leveraged AI tools to mine information and compile it
