Lithium Manganese Oxide (LMO) Market Trends, Industry | 2032

Report Description

Market Outlook:

The global Lithium Manganese Oxide (LMO) market was estimated at USD 643.5 Million in 2023 and is anticipated to reach USD 2,037.8 Million by 2032, expanding at a CAGR of 13.6% during the forecast period.

Lithium manganese oxide (LMO) is one of the key cathode materials used in lithium-ion batteries. The demand for these batteries is rising rapidly owing to their increasing adoption in electric vehicles, consumer electronics and medical devices. Various components such as anode, cathode, and electrolyte are used to make lithium-ion batteries. Materials such as lithium cobalt oxide (LCO), lithium nickel manganese cobalt oxide (NMC), lithium nickel cobalt aluminum oxide (NCA), lithium iron phosphate (LFP), lithium manganese oxide (LMO), and lithium titanate (LTO) are the most used cathode materials.

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Lithium manganese oxide can be prepared by reacting manganese oxide with lithium salts such as lithium hydroxide. Commercial production of LMO depends heavily on the steady supply of lithium. According to World Economic Forum, Australia, Chile, and China are the leading lithium producing countries having cumulative share around 90% in 2021. China in particular has capitalized on the production of lithium compounds including cathode materials used in lithium-ion batteries. Steady supply of lithium raw materials, cheap manufacturing costs, and high local demand have enabled the development of robust manufacturing capacity of LMO in China.

According to the International Energy Agency (IEA), China held over 75% share in the lithium-ion battery production capacity in 2022. As LMO is an important cathode material used in the manufacturing of lithium-ion batteries, the demand for the chemicals is particularly strong in the country.

Macro-economic Factors

Industrialization

Industrialization acts as background force for the development of materials used in lithium-ion batteries. Rising developments in the automotive, chemical, solar, and electronics industries create substantial demand for power sources such as batteries. According to the Netherlands Bureau for Economic Policy Analysis (CPB), global industrial production increased by 3.3% in 2022. This reflects an increase in output as compared to the annual average of 2.8% for the previous ten years. China, the US, Japan, Germany, India, South Korea, Italy, France, the UK, and Indonesia are the top 10 manufacturing nations across the globe. In advanced economies, industrial production exceeded pre-pandemic levels in 2022. Increase in industrial production has direct impact on demand of energy from sources such as batteries. According to the International Energy Agency, automotive lithium-ion (Li-ion) battery demand increased by about 65% to 550 GWh in 2022, from about 330 GWh in 2021, primarily as a result of growth in electric passenger car sales, with new registrations increasing by 55% in 2022 relative to 2021.

Raw Material Prices

Lithium manganese oxide (LMO) is prepared from raw materials such as manganese oxide and lithium salts such as lithium hydroxide. Manganese oxide is a cheaper raw material used in the production of electrode materials. The price fluctuations of lithium metal has substantial impact on the cost of raw materials for LMO thus, impacting the price trend and the profitability. The price of LMO depends on various factors, including supply & demand, market conditions, natural disasters, geopolitical changes, and restrictions imposed by governments.

Market Dynamics

Market Driver- Increasing Electric Vehicles Sales across the Globe

There are several appealing incentives for electric vehicles across the globe. A large number of countries have signed the Paris Climate Policy, which is backed by the car policy and calls for a 40% reduction in greenhouse gas emissions by 2030. Global sales of electric vehicles exceeded 10 million in 2022 and are expected to increase by 35% to 14 million in 2024. According to IEA forecasts, The share of the overall auto industry increased from approximately 4% in 2020 to 14% in 2022 due to the rising sales of electric cars and is expected to increase by 18% in 2024. One of the key reasons behind the development of the automotive industry is the rising acceptance of EVs.

The global automotive industry is undergoing a rapid transition due to the electric cars. China accounts for 60% of global electric car sales in 2022, making it the frontrunner in the automotive industry. More than half of the electric vehicles on roads worldwide are in China. Europe and the US, the second and third major markets, registered rapid growth in 2022, with sales rising by 15% and 55%, respectively.

Cathode materials, such as LMO, are used extensively in the lithium-ion batteries which are an integral part of electric vehicles thus, growing sales of these vehicles in propelling the market.

Market Driver- Increasing Penetration of Lithium Batteries

Lithium-ion batteries have radically altered the way electrical energy is stored. In the effort to reduce carbon footprints, their energy density, lightweight construction, and capacity to provide sustainable power for a variety of applications have revolutionized the field. These batteries have the power to revolutionize several industries, including grid management, renewable energy, and transportation.

The versatility of lithium-ion batteries makes decentralized energy storage systems possible, enabling people and communities to produce and store energy sustainably. Rapid R&D in optimization of lithium-ion batteries is increasing the adoption of lithium-ion batteries, which in turn, is boosting the lithium manganese oxide (LMO) market.

Market Restraint- Capacity limitation of Lithium Manganese Oxide (LMO)

An LMO cathode has inherent limitation on the energy density produced in the lithium-ion batteries. The capacity limitation for the energy density restricts the adoption of the batteries with cathode material LMO in applications, which specifically require high energy density. The use of LMO cathode is restricted especially in heavy electric vehicles owing to its low energy density, which hampers the market.

Market Opportunity- Increasing Inclination Toward Carbon-free Energy

Lithium-ion batteries are crucial in fostering a green future, as the world grapples with the high need to cut carbon emissions and fight climate change. Lithium-ion batteries are cutting-edge energy storage solutions that are essential to shift to a low-carbon economy, as they provide several benefits, in terms of effectiveness, sustainability, and environmental impact.

These batteries assist in balancing the intermittent nature of renewable energy generation, reducing the need for fossil fuel-based power plants by storing excess renewable energy during times of low demand and releasing it during times of peak demand. Various government initiatives have been implemented to curb environmental pollution and carbon emissions. For instance, China’s President Xi Jinping announced at the UN General Assembly in New York that China aims to bring carbon neutrality by 2060. Moreover, South Korea intends to reduce carbon emissions in the projected timeline.

Growing emphasis on lithium-ion batteries, due to rising environmental concerns, is expected to boost the demand for LMO , which is expected to propel the market in the coming years.

Scope of the Report

The report on the global lithium manganese oxide (LMO) market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Segmental Outlook

On the basis of capacity, the lithium manganese oxide (LMO) market is bifurcated into Below 120 mAh/g and 120 mAh/g and above.

120 mAh/g and above segment is expected to hold XX% share of the market by 2032. LMO cathodes are predominantly used in applications such as electric bicycles, large power tools, consumer electronics, and power storage. Batteries with a capacity of 120 mAh/g and above exactly meet the demand for these applications thus increasing their adoption.

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On the basis of end-use, the lithium manganese oxide (LMO) market is divided into power tools, electric vehicles, medical devices, and others.

The electric vehicles segment is expected to hold XX% share of the market by 2032 owing to the increasing demand EVs across the globe. Cathode materials such as LMO play a crucial role in sustainable development and functioning of electric vehicles. Moreover, increasing demand of electric vehicles such as electric bicycles is creating a robust demand of lithium-ion batteries which employs LMO.

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On the basis of distribution channel, the market is segregated into direct sales through manufacturers and sales through distributors.

The direct sales through distributors segment held XX% share of the market in 2023 and is expected to hold XX% in 2032. Lithium manganese oxide production relies on steady and robust supply of lithium metal. China is a key Lithium producer and the country has established strong manufacturing bases for lithium chemicals. China happens to be the largest consumer of the lithium chemicals, as the country holds more than 70% of the global production capacity of the lithium-ion batteries. High quantity of domestic consumptions has fueled direct sales through manufacturers owing to the close proximity of manufacturers and consumers.

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Regional Outlook

On the basis of region, the global lithium manganese oxide (LMO) market is divided into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.

The demand for LMO is directly dependent on the production of lithium-ion batteries, as it is one of the key materials used as a cathode. Asia Pacific holds the largest share of the market, as China is a major producer of lithium-ion batteries. Increasing demand for batteries, cheap labor costs, and steady supply of raw materials are expected to fuel the market in the region during the forecast period.

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Key Benefits for Industry Participants & Stakeholders

• In-depth Analysis of the Global Lithium Manganese Oxide (LMO) Market

• Historical, Current, and Projected Market Size in terms of Value

• Potential & Niche Segments and Regions Exhibiting Promising Growth Covered

• Industry Drivers, Restraints, and Opportunities Covered in the Study

• Recent Industry Trends and Developments

• Competitive Landscape & Strategies of Key Players

• Neutral Perspective on Global Lithium Manganese Oxide (LMO) Market Performance