Battery materials are the chemical ingredients that make up batteries. The major battery materials include cathode materials, anode materials, electrolytes, separators, current collectors, and foils. Cathode materials such as lithium cobalt oxide and lithium nickel manganese cobalt oxide play a vital role in determining battery capacity and energy density. Anode materials mostly consist of graphite or lithium-titanate, which serve as the storage site for lithium ions. Electrolytes allow ions to flow between the anode and cathode during charging and discharging.
Market key trends:
One of the key trends driving the battery materials market is increasing adoption of electric vehicles. According to the International Energy Agency, electric car sales have increased by 41% worldwide to reach 6.1 million in 2021. Governments across countries are coming up with policies like tax exemptions and subsidies to promote electric mobility. For example, the UK has proposed a ban on sales of new petrol and diesel cars by 2030. Growing electric vehicle sales will significantly boost the demand for battery materials like lithium, graphite, and cobalt over the coming years. Lithium, in particular, plays an important role in determining the range of electric vehicles, thereby witnessing increased consumption with the rapid adoption of EVs.
Porter’s Analysis
Threat of new entrants: Battery material industry requires high capital investments for R&D and production facilities which pose high entry barriers for new companies.
Bargaining power of buyers: Large battery and automotive manufacturers have significant bargaining power over battery material suppliers due to standardized products and focus on price negotiation.
Bargaining power of suppliers: Key material suppliers such as lithium, cobalt and graphite producers have moderate bargaining power due to increasing collaboration between battery and automobile manufacturers to secure raw material supply.
Threat of new substitutes: Continuous R&D in battery chemistry and alternative materials may lead to new and improved substitutes posing threat to existing battery materials.
Competitive rivalry: Intense competition exists among major battery material suppliers due to their focus on new product development, cost leadership and vertical integration.
SWOT Analysis
Strength: Large global presence and integration across supply chain provides opportunity to battery materials major players to fulfill growing demand.
Weakness: Volatility in raw material prices and supply chain disruptions can impact profitability of battery material producers. Dependency on few end-use industries also poses business risks.
Opportunity: Rising demand for lithium-ion batteries from electric vehicles and energy storage domains along with regulatory push for clean mobility presents significant market opportunity.
Threats: Stringent environmental norms regarding mining activities and toxicity of few materials along with geo-political issues are major threats for battery materials industry.
Key Takeaways
The Global Battery Materials Market Size is expected to witness high growth, exhibiting CAGR of 6.0% over the forecast period, due to increasing adoption of electric vehicles. Asia Pacific dominates the global market with over 50% share owing to presence of large automotive and battery manufacturers in China, South Korea and Japan. 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.
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