Global Battery Grade Lithium Compounds Market - 2024-2031

Global Battery Grade Lithium Compounds Market - 2024-2031

Global Battery Grade Lithium Compounds Market reached US$ 5.6 billion in 2023 and is expected to reach US$ 28.6 billion by 2031, growing with a CAGR of 22.7% during the forecast period 2024-2031.

The demand for battery-grade lithium compounds is rising strongly due to the widespread use of portable electronics such as laptops, smartphones and wearable technologies. Advanced lithium-ion batteries with greater energy density and greater lifespans continue to be required as consumer devices become more complex and energy-intensive. The trend is particularly crucial as it results in the creation of more potent and smaller electronic gadgets due to technical improvements

Energy storage systems (ESS) are becoming more and more expensive as a result of the world's move to renewable energy sources to control the intermittent nature of solar and wind power. The state-of-the-art in energy storage is provided by lithium-ion batteries, which are dependent on premium lithium compounds. The demand for battery-grade lithium compounds is being driven by the expansion of decentralized energy systems and grid-scale energy storage projects, which are facilitating the integration of renewable energy sources into the power grid.

Asia-Pacific is among the growing regions in the global battery grade lithium compounds market covering more than 1/3rd of the market. Battery-grade lithium compounds are in high demand due in large part to the Asia-Pacific's electric car market's explosive expansion. Government incentives, environmental legislation and a growing consciousness of sustainable mobility are driving the adoption of electric vehicles (EVs) in countries like China, Japan and South Korea.

Dynamics

Increasing Energy Storage and Renewable Energy Solutions

The demand for battery-grade lithium compounds is being driven by the global push towards renewable energy sources and the integration of energy storage systems (ESS). To help to establish a more dependable and sustainable energy infrastructure, lithium-ion batteries are essential for storing energy produced from renewable sources like solar and wind power.

Additionally, the demand for high-quality lithium compounds develops in tandem with the deployment of energy storage solutions, such as large-scale battery storage projects, to address the intermittent nature of renewable energy sources. The global dedication to reaching clean energy targets, which underlines the significance of lithium compounds in providing effective energy storage solutions and supporting the shift to a more sustainable and decentralized energy setting, further drives this engine.

Increasing Demand for Electric Vehicles

The market for battery-grade lithium compounds is expanding due in large part to the growing demand for electric vehicles globally. The use of electric vehicles has risen significantly as governments all through the world concentrate on lowering carbon emissions while supporting green transportation. The main energy storage technology for EVs is lithium-ion batteries, which use battery-grade lithium compounds such as lithium carbonate and lithium hydroxide in their cathode designs.

For Instance, in 2023, Cornish Lithium invested US$57.9 million to enhance UK's production of battery-grade lithium, crucial for electric vehicles (EVs) and renewable energy storage. The funding will expedite the development of a domestic supply chain, supporting the scaling up of battery production for EVs and renewable energy solutions. The investment is a significant step towards meeting the rising demand for lithium and advancing sustainable mining practices in UK.

Geopolitical Risks and Supply Chain Sensitivity

The market for lithium compounds suitable for batteries is severely limited by supply chain vulnerabilities and geopolitical threats. Australia, China, Chile, Argentina and other countries contain the majority of the world's lithium deposits. Because of this concentration, trade disputes, regulatory changes in these important producing regions and geopolitical conflicts can all disrupt the supply chain.

The dependence of the lithium supply chain on particular extraction techniques, such as hard rock mining or brine extraction, also presents a danger. Restrictions on operations and regulations may result from the ecological effects of mining, water scarcity and environmental concerns. Any adverse situations, such as trade disputes, political unrest or modifications to mining laws, may result in a scarcity of lithium, which would impact the industry's capacity to produce battery-grade lithium compounds.

Expensive Production Costs and Limited Processing Facilities

The high cost of manufacturing lithium through extraction, processing and purification is a major restriction to the global market for battery-grade lithium compounds. Whether lithium is extracted from hard rock or brine sources, it requires sophisticated and energy-intensive techniques.

The overall cost of creating battery-grade lithium compounds is influenced by the expenses related to these procedures as well as the difficulties involved in transporting lithium compounds to production plants. Furthermore, to fulfill the rising demand for lithium-ion batteries, more processing infrastructure would be needed. However, creating such infrastructure would cost a lot of money and time, which might cause supply chain bottlenecks.

Segment Analysis

The global battery grade lithium compounds market is segmented based on type, battery technology, application, end-user and region.

Increasing Expansion of Cathode Materials in Energy Storage Systems

The cathode material segment is among the growing regions in the global battery grade lithium compounds market covering more than 1/3rd of the market. The global market for lithium compounds that can be used in batteries is mostly driven by the expansion of cathode materials. Lithode materials, which include lithium iron phosphate (LiFePO4), lithium manganese oxide (LiMn2O4) and lithium cobalt oxide (LiCoO2), are essential to the functioning, energy density and general efficiency of lithium-ion batteries.

The growing demand for energy storage systems and electric vehicles (EVs) has led to a greater demand for improved cathode materials. The growing fields of electric mobility and renewable energy depend heavily on lithium compounds, such as lithium hydroxide and carbonate, which are vital precursors for cathode materials.

Geographical Penetration

Rising Demand Lithium Compounds in the Pharmaceutical Industry in Asia-Pacific

Asia-Pacific has been a dominant force in the global battery grade lithium compounds market. The demand for lithium compounds is being driven by the fast population growth in nations like China and India as well as their strong reliance on end-use industries like the building and construction, automotive and medical sectors. Lithium compounds are used in many applications within these end-use industries.

For example, the India Brand Equity Foundation (IBEF) estimates that by the end of 2021, the country's pharmaceutical market will be valued at around US$ 41 billion. Additionally, in 2020, India's pharmaceutical business obtained investments of US$ 17.5 billion. In February 2021, the Indian government launched an incentive program aimed at luring US$ 2.07 billion into the industry.

It will have an important influence on the region's market for lithium compounds. Additionally, the International Trade Administration reports that Japan's pharmaceutical business produced US$ 84.6 million in 2019 compared with US$ 62.57 million in 2018, a 35.2% rise. The is propelling the lithium compound market in the Asia-Pacific.

COVID-19 Impact Analysis

The global demand for battery-grade lithium compounds has been impacted by the COVID-19 epidemic in some ways. During the early stages of the pandemic, several lockdowns and production and supply chain interruptions had a substantial impact on a number of industries, including consumer electronics and electric vehicle production.

The in turn affected the market for lithium compounds suitable for batteries. The demand for lithium-ion batteries suddenly declined as a result of the manufacturing halt and lower consumer spending during lockdowns, which had an impact on the market for lithium compounds as a whole. The market for lithium was affected by a number of patterns that surfaced as people adjusted to the new normal.

The pandemic encouraged the shift to electric cars and renewable energy sources by underlining the vitality of clean energy and sustainable technology. All over the world, green projects have been given top priority by governments and businesses, which has raised demand for lithium-ion batteries for energy storage systems, electric cars and other uses. The change in emphasis spurred growth and recovery in the market for battery-grade lithium compounds.

The need for robust and varied supply chains was further highlighted during the pandemic. The imperative of ensuring a steady supply of essential minerals has come to light as a result of supply chain interruptions, especially in areas that produce lithium. In the market for battery-grade lithium compounds, initiatives to boost domestic production and lessen reliance on specific sectors gained traction and helped to shape future plans for risk management.

Russia-Ukraine War Impact Analysis

Global sectors, especially products pricing and supply networks, are exposed to major effects from geopolitical tensions and wars. Increased volatility and uncertainty may result from supply chain interruptions brought on by geopolitical events in the market for battery-grade lithium compounds. The manufacture of lithium-ion batteries, which in return affects businesses dependent on these batteries, such as electric cars and energy storage systems, may be affected by supply shortages or interruptions in significant facilities that produce lithium.

The investors and industry professionals keep a careful eye on geopolitical developments in order to assess any potential effects on the commodities markets. The occurrences have the potential to alter supply chain disruptions and price changes by influencing market dynamics. The design is essential to consult recent research and analyses from professionals in the field to comprehend the immediate effects of geopolitical events on the market for battery-grade lithium compounds.

The supply chain for lithium is global, with multiple countries participating at different phases of the production process. Russia is a major participant in the mining and manufacture of many minerals, for example. The availability of raw materials required for the production of lithium compounds suitable for batteries may be impacted if the war causes disruptions in the trade routes or supply chain.

By Type
• Lithium Carbonate
• Lithium Hydroxide
• Lithium Concentrate
• Lithium Metal
• Butyl Lithium
• Lithium Chloride
• Lithium Bromide
• Lithium Iodide
• Lithium Oxide
• Others Nitride
• Others

By Battery Technology
• Cathode Material
• Anode Material
• Electrolyte

By Application
• Li-ion Batteries
• Cement & Concrete
• Metallurgy
• Lubricants
• Glass & Ceramics
• Polymers
• Specialty Inorganics
• Medicines
• Others

By End-User
• Aerospace and Defense
• Automotive
• Oil and Gas
• Energy
• Building
• Chemical Processing
• Others

By Region
• North America
U.S.
Canada
Mexico
• Europe
Germany
UK
France
Italy
Russia
Rest of Europe
• South America
Brazil
Argentina
Rest of South America
• Asia-Pacific
China
India
Japan
Australia
Rest of Asia-Pacific
• Middle East and Africa

Key Developments
• On November 13, 2023, The Exxon Mobil Corporation plans to establish itself as a major manufacturer of lithium, an essential part of batteries for electric vehicles (EVs). The company's first phase of lithium production in North America is starting in southwest Arkansas, an area recognized to contain substantial lithium reserves. The product line will be marketed under the Mobil Lithium brand, expanding Mobil's longstanding technological collaboration with the automotive industry.

Competitive Landscape

The major global players in the market include Albemarle Corporation, SQM, Ganfeng Lithium Group Co., Ltd, Tianqi Lithium Industry Co., Ltd, Livent Corporation orocobre Limited, Piedmont Lithium Inc., Neometals Ltd, Neo Lithium Corporation and Yibin Tianyi Lithium Industry Co., Ltd.

Why Purchase the Report?
• To visualize the global battery grade lithium compounds market segmentation based on type, battery technology, application, end-user and region and understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of battery grade lithium compounds market-level with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as Excel consisting of key products of all the major players.

The global battery grade lithium compounds market report would provide approximately 70 tables, 79 figures and 198 Pages.

Target Audience 2024
• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies