by The Lithium Compound market is integral to increasing demand for electric vehicles globally. Lithium compounds like lithium carbonate and lithium hydroxide are used in manufacturing batteries that power electric vehicles. The global lithium compound market is estimated to be valued at US$ 18.64 Bn in 2024 and is expected to exhibit a CAGR of 13% over the forecast period 2024 to 2031.
Lithium compounds are key raw materials used in lithium-ion batteries. Lithium carbonate and lithium hydroxide are the major lithium compounds used in battery cathodes and electrolytes. Increasing demand for portable consumer electronics and electric vehicles is a major factor driving the need for lithium-ion batteries. Lithium carbonate is commonly used in batteries for consumer electronics such as smartphones, laptops, power tools etc. whereas lithium hydroxide finds increased usage in lithium-ion batteries for electric vehicles. The environmental benefits and lower operating costs of electric vehicles compared to gasoline vehicles have ignited demand in the automobile industry especially in Europe and China. This increasing demand for electric vehicles is estimated to drive the lithium compound market.
Key Takeaways
The electric vehicle market is witnessing exponential growth especially in China, Europe and North America creating Lithium Compound Market Demand for batteries used in EVs. Moreover, increasing demand for consumer electronics is also creating opportunities for lithium compound manufacturers.
Key players operating in the Lithium Compound market are Lithium Americas Corp, Albemarle Corporation, Neometals Ltd, FMC Corporation, Sociedad Química y Minera de Chile, Livent Corporation, Tianqi Lithium Industries Inc., Nemaska Lithium Inc., Neo Lithium Corporation, Millennial Lithium Corporation, Galaxy Resources Limited, PACIFIC ORGANICS PVT LTD. , Satyam Pharma-Chem Pvt. Ltd. , Otto Chemie Pvt. Ltd., Sontara Organo Industries, Mody Chemi Pharma Ltd, Vizag chemical, Ennore India Chemicals, and Zama chemical.
Key players are investing heavily in capacity expansion plans to cater to the rising global demand. For instance, Albemarle Corporation is expanding its lithium hydroxide production capacity in China and Chile. Major players are also focusing on sustainable extraction methods and long term lithium supply agreements. The global lithium compound market offers opportunities for backward integration and acquisition of lithium brine reserves and hard rock deposits.
Market Drivers
Growing electric vehicle fleet – Strict emission norms and incentivization of electric vehicles by governments globally are driving electric vehicle sales. As lithium-ion batteries are the preferred technology for electric vehicles, growing EV fleet directly increases lithium compound demand.
Increasing demand for consumer electronics – Consumer electronics have become an integral part of daily lives. Growing usage of smartphones, tablets, power tools and laptops is increasing demand for lithium-ion batteries and associated lithium raw materials.
PEST Analysis
Political: The government regulations regarding lithium mining and environment protection are likely to impact the industry’s growth. Legislations related to carbon emissions and alternative energy vehicles can influence the market significantly.
Economic: Growing demand for lithium-ion batteries from automotive and energy storage applications is a major driver for the market. Investments in grid-scale storage and electric vehicle infrastructure expansion will propel future growth.
Social: Increasing public awareness about climate change and environmental protection is generating demand for clean energy solutions and electric vehicles. The social acceptability of lithium mining can impact its supply.
Technological: Continuous battery performance improvements, declining costs, and development of high-nickel cathode technologies are expanding the applications of lithium compounds. Advances in extraction and refinement processes help boost supply.
The lithium compound market in terms of value is currently concentrated in Asia Pacific, led by strong demand from China. In addition to extensive lithium reserves, Chinese companies dominate global lithium production capacity.
North America is the fastest growing regional market and is expected to witness a high CAGR during the forecast period. Investments in the electric vehicle and renewable energy sectors in the US and Canada are driving regional demand. Government support for energy storage projects and EV adoption programs are also fueling market growth in North America.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it.
About Author - Ravina Pandya
Ravina Pandya,a content writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemicals and materials, etc. With an MBA in E-commerce, she has expertise in SEO-optimized content that resonates with industry professionals. LinkedIn Profile
