February 25, 2024

Lithium Hydroxide Market is driven by increasing demand of lithium-ion batteries

Lithium hydroxide is a vital raw material used in the manufacturing of lithium-ion batteries which are extensively deployed in various applications ranging from consumer electronics to electric vehicles. Lithium hydroxide possesses unique chemical and electrochemical properties which make it suitable for their use as cathode materials in lithium-ion batteries. The growing use of lithium-ion batteries in portable electronics and electric vehicles has surged the demand for lithium hydroxide over the years. Lithium-ion batteries deliver higher energy density and require low maintenance, making them a preferred choice for many applications. These batteries can store more power in comparably sized battery packs and require no scheduled replacement or refurbishment over the life of the application.

The global industrial gloves market is estimated to be valued at US$ 8,053 Mn in 2024 and is expected to exhibit a CAGR of 6.9% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

One of the primary trends witnessed in the lithium hydroxide market is increasing demand from the electric vehicle industry. Stringent emission norms and supportive government policies promoting adoption of electric vehicles worldwide have accelerated the demand for lithium-ion batteries. As lithium hydroxide is extensively used in the manufacturing of lithium-ion battery cathodes, higher electric vehicle sales directly translate to greater consumption of lithium hydroxide. Industry experts project electric vehicles to account for over 30% of all new vehicle sales globally by 2030. This rapid proliferation of electric vehicles is likely to significantly augment demand for lithium hydroxide over the next decade. Another major trend is the shifting production landscape, with China dominating global lithium hydroxide production capacity. Driven by robust EV market growth and policy push for localizing supply chains, China now accounts for over 50% of global lithium hydroxide production capacity. Its dominant position is expected to strengthen further as Chinese producers focus on battery materials integration to maximize efficiencies.

Porter’s Analysis

  • Threat of new entrants: The lithium hydroxide market has moderate threat of new entrants due to high capital requirements and economies of scale of existing players.
  • Bargaining power of buyers: Buyers have moderate bargaining power due to the availability of substitutes.
  • Bargaining power of suppliers: Suppliers have high bargaining power due to limited availability of raw materials.
  • Threat of new substitutes: Threat from new substitutes is low as lithium hydroxide has few close substitutes for its applications in batteries.
  • Competitive rivalry: The market has high competitive rivalry due to presence of established players.

Key Takeaways

The global lithium hydroxide market is expected to witness high growth over the forecast period of 2024 to 2031. The global industrial gloves market is estimated to be valued at US$ 8,053 Mn in 2024 and is expected to exhibit a CAGR of 6.9% over the forecast period 2023 to 2030.

Regional analysis: Asia Pacific accounts for more than 60% share of the global lithium hydroxide market led by China. The region is expected to continue its dominance owing to presence of lithium-ion battery manufacturers and electric vehicle market growth. North America and Europe are other major markets for lithium hydroxide.

Key players: Key players operating in the lithium hydroxide market are FMC, SQM, Albemarle, Tianqi Lithium and Livent. FMC is one of the leading producers of lithium and lithium compounds including lithium hydroxide.