The battery materials market is seeing rising trends towards sustainable energy storage driven by clean energy policies and regulations. Battery materials such as lithium-ion, lead-acid, and nickel-based batteries play a critical role in powering electrical vehicles, stationary energy storage, and electronics devices. These materials facilitate electrochemical oxidation-reduction reactions that enable the efficient storage and release of electrical energy.
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.
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. Battery materials manufacturers are focusing on expanding lithium-ion battery production capacities to cater to the growing demand from electric vehicles and energy storage applications. The global electric vehicle stock exceeded 10 million in 2021 and is expected to grow at a CAGR of 29% over the next decade. This rising adoption of electric vehicles is expected to drive the demand for
lithium, cobalt, graphite, and nickel used in lithium-ion battery cathodes and anodes.
The increasing deployment of renewable energy is also augmenting the need for large-scale energy storage systems. Countries and regions are formulating policies and targets to increase the percentage of clean energy sources. This is propelling the demand for battery storage technologies that use materials such as lithium, lead, nickel, and vanadium. Battery materials companies are investing heavily in mining and manufacturing facilities across regions to ensure security of supply and gain access to key resources.
Market Key Trends
One of the key trends in the battery materials market is the shift towards sustainable and ethically-sourced materials. With increasing scrutiny on artisanal mining practices and child labor in countries like Congo and China, battery material manufacturers are focusing on developing partnerships for responsible sourcing of critical materials like cobalt, lithium, and graphite. Companies are also investing in recycling technologies to recover these materials from spent batteries and create a circular economy. The adoption of blockchain for tracing material production stages is another emergent trend that will enhance supply chain transparency for battery materials in the coming years.
Porter's Analysis
Threat of new entrants: The battery materials market requires high capital investments to build manufacturing infrastructure. Furthermore, there are economies of scale enjoyed by already established players. These factors deter new players from easily entering the market.
Bargaining power of buyers: Due to the presence of many suppliers of battery materials, buyers have reasonable bargaining power to negotiate on price and quality. They can source materials from multiple suppliers.
Bargaining power of suppliers: Key raw materials suppliers like lithium producers enjoy pricing power due to constrained global supply of lithium. Input material producers can influence prices.
Threat of new substitutes: With continuous RD in battery technology, new battery chemistries are emerging which can substitute traditional lithium-ion batteries. This poses a medium threat of substitution.
Competitive rivalry: The battery materials market has moderate competition due to presence of large global players. Players compete on pricing, product quality, and securing raw material supplies.
China accounts for over 50% of the global battery materials market value owing to its dominance in battery and electric vehicle production. It is home to various raw material reserves and battery materials manufacturers.
Europe's battery materials market is growing fastest at around 8% CAGR driven by the region's focus on e-mobility and energy storage for renewable integration. Countries like Germany, Sweden and Norway are spearheading the transition and spurring battery materials demand.
Geographical Regions
China accounts for the largest share of the global battery materials market in terms of value owing to its dominance in battery and electric vehicle production. It is home to various raw material reserves and battery materials manufacturers. The country accounts for over 50% of the total market value currently.
Europe's battery materials market is growing the fastest at around 8% CAGR driven by the region's strategic focus on e-mobility and energy storage for renewable energy integration in the power sector. Major countries spearheading this transition include Germany, Sweden and Norway where electric vehicles sales are rising rapidly. This is driving the demand for battery materials in Europe.