Cathode Materials Market

Updated on : March 19, 2024

Cathode Materials Market

The global cathode materials market was valued at USD 25.9 billion in 2022 and is projected to reach USD 52.6 billion by 2027, growing at 15.2% cagr from 2022 to 2027. Increased usage of batteries in key industries such as electric vehicles and consumer electronics, along with the growing usage in energy storage devices, is expected to drive the market during the forecast period.

Global Cathode Materials Market Trends

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Cathode Materials Market Dynamics

Driver:Increasing Demand for HEVs, PHEVs, and EVs

There has been tremendous growth in the demand for EVs in recent years. According to EV-Sales Volumes data, global volume sales of battery EVs and plug-in hybrid electric vehicles (PHEVs) increased extensively in 2021. This rise in demand can be attributed to several reasons, such as monetary and non-monetary incentives to EV manufacturers by governments and increasing awareness about the rising greenhouse gas emissions. Thus, growth in demand for HEVs, PHEVs, and EVs is expected to boost the demand for cathode materials.

Restraints: Safety issues related to storage and transportation of batterie

Batteries contain hazardous chemicals, including acids and heavy metals, such as mercury and lead. Occupational diseases have increased in several parts of the world among battery workers. The rising demand for batteries, availability of cheap labor, and increasing corporate interests have increased the production of batteries while disregarding the local population's safety. Thus, these safety issues related to batteries are propelling governments to take strict action against manufacturers of these batteries, which will hamper the growth of the cathode materials market.

Opportunity: Use of batteries in energy storage devices

An energy storage device is defined as an apparatus used for storing electric energy. Lead-acid and Li-ion batteries have proven to be suitable for large-capacity energy storage systems. These batteries are designed for superior performance with high power output in various applications. For instance, data centers use UPS, which provides power to a load in emergencies when the main power fails. Thus, the growing usage of batteries in the energy storage system is expected to expand the market for cathode materials.

Challenge: Lack of government subsidies and incentives for lithium-ion battery manufacturers in emerging markets

There is a growing demand for lithium-ion batteries in most countries, such as Germany, China, and the US. These batteries are used in applications such as electric vehicles and renewable energy storage. In order to encourage the renewable form of energy, governments of various countries are focusing on subsidies and incentives to support the production of lithium-ion batteries. But in regions such as Africa, there is not much contribution from the government to enhance the production of lithium-ion batteries. This is hindering the growth of these batteries, which is creating a negative impact on the growth of the cathode materials market

Based on material, lead dioxide cathode materials segment is the largest market during the forecast period

The lead dioxide cathode materials segment accounted for the largest segment in 2021 in terms of value and volume. Lead-acid batteries are used extensively in energy storage, automotive, and telecommunication industries. In the current scenario, the cost or expenditure, be it any business, is a critical component defining the business's success. Although lithium-ion batteries are well poised to become the next big thing in the battery space, the difference in the pricing, leading to a significant overall cost difference, forms a crucial factor for its preference over lithium-ion batteries. Thus, growth in lead acid batteries is expected to enhance the market for the lead dioxide materials segment.

Based on battery type, lithium-ion segment is expected to grow at the fastest rate during the forecast period

The lithium-ion segment accounted for the fastest growing segment, by battery type during the forecast period, in terms of value. The growth of lithium-ion batteries is driven by factors such as the rising demand for LFP and NMC lithium-ion batteries (chemistry type) in plug-in vehicles and the growing adoption of lithium-ion batteries in renewable energy storage. Thus, the growth of lithium-ion batteries will fuel the demand for the li-ion segment during the forecast period.

Based on end-use, automotive segment is the largest market during the forecast period

The automotive sector accounted for the largest market, by end-use during the forecast period, in terms of value. Due to the growing environmental concerns related to the pollution created by internal combustion engines, there is a huge growth in demand for electric vehicles. Electric vehicles use batteries as a source of power, thus, growth in demand for electric vehicles will enhance the market for cathode materials.

Asia Pacific is the largest cathode materials market in terms of value

Asia Pacific accounted for the largest share in terms of value, in 2021. The major economies of the Asia Pacific region contributing significantly to the growth of the cathode materials market are China, Japan, India, Malaysia, Taiwan, and South Korea. The region has emerged as an important consumer of electric vehicles and consumer electronics, aided by a rise in the standard of living of the people and disposable income. This further increases the growth of the cathode materials market in the Asia Pacific.

Source: Secondary Research, Expert Interviews, and MarketsandMarkets Analysis

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Key Market Players

Major companies in the cathode materials market include Umicore (Belgium), Sumitomo Metal Mining Co., Ltd. (Japan), POSCO (South Korea), Zhejiang Huayou Cobalt (China), and Shenzhen Dynanonic Co., Ltd.  (China), among others. A total of 20 major players have been covered. These players have adopted joint ventures, expansions, agreements, partnerships, and contracts as the major strategies to consolidate their position in the market.

Read More: Cathode Materials Companies

Cathode Materials Market Report Scope

This research report categorizes the Cathode materials market based on material, battery type, end-use, and region.

Based on material, the cathode materials market has been segmented as follows:

• LI-ION CATHODE MATERIALS
  • LITHIUM IRON PHOSPHATE (LFP)
  • LITHIUM COBALT OXIDE (LCO)
  • LITHIUM NICKEL MANGANESE COBALT (NMC)
  • LITHIUM NICKEL COBALT ALUMINUM (NCA)
  • LITHIUM MANGANESE OXIDE (LMO)
• LEAD DIOXIDE CATHODE MATERIALS
• OTHER CATHODE MATERIALS

Based on battery type, the cathode materials market has been segmented as follows:

• Lithium-ion
• Lead-acid
• Others

Based on end-use, the cathode materials market has been segmented as follows:

• Automotive
• Consumer electronics
• Industrial
• Others

Based on Region, the cathode materials market has been segmented as follows:

• Asia Pacific
• Europe
• North America
• Rest of World (RoW)

Recent Developments

• In April 2022, POSCO Chemical announced that it had begun constructing a new manufacturing plant capable of producing 30,000 tons of high-purity nickel cathodes. This will help the company to expand its customer base for the cathode materials market.
• In May 2022, Umicore inaugurated its new global R&D center for cathode materials in Cheonan, Korea. It focuses on next-generation battery materials, including very high-nickel NMC, low cobalt NMC, manganese-rich chemistries as well as solid-state battery materials technology.
• In August 2021, Ningbo Shanshan Co., Ltd. formed a joint venture with BASF SE. The newly formed company, BASF Shanshan Battery Materials Co., Ltd., markets precursor cathode active materials, and cathode active materials.

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