The global lithium compounds market size was USD 7 billion in 2022 and is likely to reach USD 26 billion by 2031, expanding at a CAGR of 16% during 2023–2031. Rising applications of lithium compounds among major end-use industries are likely to drive the market during the projection period.
Demand for lithium compounds is growing in various industries owing to their key properties such as high electric and thermal conductivity, less metal density, and high water solubility. These properties are increasing applications of lithium compounds in several industries including electronic device manufacturing, electric vehicle production, and renewable power storage solutions. As these industries are projected to flourish in the coming years owing to an expanding consumer base all over the world, the demand for lithium compounds is expected to grow significantly, thereby, propelling the market during the projection period.
The market report finds that the COVID-19 pandemic impeded the lithium market growth as there were country-wide lockdowns imposed by governments, which disrupted lithium supply chain management. In addition, several automobile, construction, and ceramic manufacturing companies had to postpone their projects and operations, which directly affected the lithium compounds market. However, there was a surge in the demand for lithium compounds in the pharmaceutical industry, for application in manufacturing psychiatric medication, which further helped in the market growth recovery. For instance,
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As per a report by the Royal Society of Chemistry, lithium carbonate is applied in drugs, tablets, and solutions that are used to treat manic-depressive illnesses. It reduces the severity and frequency of manic episodes. Many people suffered from mental illness during the pandemic, thus there was a high demand for lithium compounds such as lithium carbonate in the pharmaceutical sector.
Lithium Compounds Market Dynamics
Major Drivers
Growing demand for lithium compounds in major end-use industry applications such as EVs, electronics, construction, and sustainable energy storage devices is expected to drive the market. These industries have adopted lithium compounds as it is lightweight and offer high electric and thermal conductivity. In addition, properties such as high water solubility at low concentrations are highly preferred by several industries, as it does not harm the environment by wasting a large amount of water. Moreover, growing construction and renovation investments due to rising urbanization across the world boost the demand for lithium compounds, which is likely to further fuel the market.
Existing Restraints
High cost of lithium compounds is likely to restrain the market. Due to high costs, companies with budget limits tend to opt for other substitutes or alternatives, which is further likely to hamper the market growth. Moreover, in medical applications, lithium salts or compounds can affect renal systems and damage internal parts of the kidneys, which is further projected to hamper their demand in the market.
Emerging Opportunities
Surging demand for high-quality batteries is anticipated to create novel growth opportunities in the market. Additionally, increasing demand for lithium compounds in aircraft manufacturing is projected to create new revenue generation opportunities in the market, as it is lightweight and improves the fuel efficiency of the aircraft. Moreover, the rising awareness regarding environmental concerns increases the demand for electric vehicles in numerous countries, which directly fuels the demand for lithium compounds.
Scope of Lithium Compounds Market Report
The report includes an assessment of the trends, segments, and regional markets. Overview and dynamics have also been included in the report.
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Attributes
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Details
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Report Title
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Lithium Compounds Market - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast
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Base Year
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2022
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Historic Data
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2016–2021
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Forecast Period
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2023–2031
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Segmentation
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Derivative (Lithium Carbonate, Lithium Concentrate, Lithium Metal, Lithium Hydroxide, Butyl Lithium, and Lithium Chloride) and Application (Li-ion Batteries, Pharmaceuticals, Aluminum Production, Lubricants, Glass & Ceramics, and Others)
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Regional Scope
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Asia Pacific, North America, Latin America, Europe, and Middle East & Africa
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Report Coverage
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Company Share, Market Analysis and Size, Competitive Landscape, Growth Factors, Market Trends, and Revenue Forecast
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Key Players Covered in the Report
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FMC Corporation; Ganfeng Lithium Group Co.; Lithium Americas Corp.; Albemarle Corporation; Orocobre Limited Pty Ltd; Neometals Ltd; SQM SA; Nemaska Lithium; Livent; and China Lithium Products Technology Co., Ltd.
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Lithium Compounds Market Segment Insights
Derivative Segment Analysis
Based on derivative, the lithium compounds market is divided into lithium carbonate, lithium concentrate, lithium metal, lithium hydroxide, butyl lithium, and lithium chloride. The lithium carbonate segment is expected to expand at a major growth rate during the projection period, owing to its expanding applications in pharmaceuticals, aluminum production, and glass & ceramics industries. Furthermore, the rising utilization of lithium carbonate in Li-ion battery manufacturing is boosting the segment.
The lithium hydroxide segment is anticipated to account for a significant market share during the forecast period, due to its increasing usage in the production of lithium lubricants and greases. Moreover, it is highly applied in air purification systems as it has the capability of binding carbon dioxide, thus, such factors propel the segment.
Application Segment Analysis
On the basis of application, the global market is segregated into Li-ion batteries, pharmaceuticals, aluminum production, lubricants, glass & ceramics, and others. The Li-ion batteries segment is projected to register a considerable CAGR during the forecast period, attributed to the rising demand for electric vehicles (EVs).
Lithium is preferred in manufacturing EV batteries as they store more power per unit weight when compared to nickel-cadmium alternatives. Additionally, Li-ion batteries facilitate advantages such as long durability, high energy density, and an extended lifecycle. These factors accelerate the segment growth. Moreover, the rising favorable policies made by several nations to promote EV adoption are further likely to drive the segment. For instance,
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According to recent findings published by the International Energy Agency (IEA), from 2020 to 2022 sales of electric cars surged by 10%. In 2022 alone, EV sales numbers exceeded the 10 million mark. This demand is likely to continue strongly in 2023 as well, as more than 2.3 million electric cars were bought in the first quarter, which is 25% more than the sales numbers in the first quarter of 2022. IEA has projected the EV sales to reach 14 million by the end of 2023.
The glass & ceramics segment accounts for a significant market share, owing to surging demand for lithium compounds in ceramic and glass manufacturing, as it increases ceramic strength and lifespan. Moreover, lithium compounds offer high surface tension and thermal shock resistance to ceramic products. Thus, such factors propel the segment during the assessment period.
Regional Outlook
In terms of region, the global lithium compounds market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. Asia Pacific is expected to dominate the market during the forecast period, due to rising economic expansion in countries including China, South Korea, and India. In addition, these countries have highly developed electronics, automotive, and ceramics & glass industries, which utilize a major volume of lithium compounds, which is boosting the market in the region.
The market in North America is anticipated to expand at a rapid pace during the forecast period, attributed to the surging development projects in countries such as Canada, Mexico, and the US. Some of the novel development investments undertaken by these governments in these countries include further increasing the manufacturing electric cars. In addition, the rising demand for storage devices propels the use of lithium compounds and further boosts the regional market. Moreover, the increasing number of joint investment partnerships by leading automobile and lithium-producing companies in the US is projected to surge the growth opportunities in the region. For instance,
- On February 16, 2023, Lithium Americas Corp. and General Motors announced a joint investment of USD 650 million for producing lithium from the Nevada-based Thacker Pass mine, which is capable of providing lithium for manufacturing around one million EVs each year. Thacker Pass Mine is the world’s third-largest source of lithium and the major one in the US.
Segments
The lithium compounds market has been segmented on the basis of
Derivative
- Lithium Carbonate
- Lithium Concentrate
- Lithium Metal
- Lithium Hydroxide
- Butyl Lithium
- Lithium Chloride
Application
- Li-ion Batteries
- Pharmaceuticals
- Aluminum Production
- Lubricants
- Glass & Ceramics
- Others
Region
- Asia Pacific
- North America
- Latin America
- Europe
- Middle East & Africa
Key Players
- FMC Corporation
- Ganfeng Lithium Group Co.
- Lithium Americas Corp.
- Albemarle Corporation
- Orocobre Limited Pty Ltd
- Neometals Ltd
- SQM SA
- Nemaska Lithium
- Livent
- China Lithium Products Technology Co., Ltd.
Competitive Landscape
Key players operating in the global lithium compounds market include FMC Corporation; Ganfeng Lithium Group Co.; Lithium Americas Corp.; Albemarle Corporation; Orocobre Limited Pty Ltd; Neometals Ltd; SQM SA; Nemaska Lithium; Livent; and China Lithium Products Technology Co., Ltd.
Major companies are adopting market expansion & growth strategies such as acquisitions, divestitures, partnerships, R&D investments, collaboration, mergers, and product launches to boost their market share. For instance,
- On May 23, 2022, Ganfeng Lithium Group Co. launched a new project that aims to produce 50,000-ton lithium from a total area of about 428 mu and has an investment of 2 billion yuan. The project includes the extraction of lithium using spodumene.
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