Research Report: Brief Review of Global Li-ion Battery Market

1. Global Li-ion Battery Capacity Forecast (Electric Vehicles and Power Systems)

The Global Battery Alliance (GBA) is a public-private partnership within the World Economic Forum. In their Vision Report 2030 on Sustainable Battery Value Chains (Global Battery Alliance, 2019), the GBA discusses lithium-ion battery manufacturing capabilities and forecasts for lithium-ion market demand to 2030.

Their forecasts for 2030 are detailed below.

The information in the table details that China is expected to dominate lithium-ion battery (LiB) production, accounting for 42% of total production. In Europe, the European Union has announced ambitious plans for the development and manufacture of electric vehicles. But it also has to do with coming from large South Korean manufacturing companies looking to gain a foothold in the European market. Analysis suggests that 40-50% of European capacity will be attributed to South Korean chemical engineering giants LG Chem, SK Innovation and Samsung investing in partnerships with European automakers.

The boost to European investment is largely due to the German auto industry. Since the main technological component of electric vehicles is energy storage, more specifically lithium-ion batteries, competition in the electric vehicle industry will require advanced technology in lithium battery manufacturing. Monitoring findings of the German energy storage industry show that European and American technology is lagging behind, so for national security and strategic considerations, European automakers need European lithium battery factories instead of China or South Korea. According to recent announcements, Europe has 38GWh of lithium batteries (manufacturing capacity in 2020), which will increase to 396GWh of capacity by 2025 and 576GWh of capacity (2030). Assuming that each electric vehicle is equipped with a 50kWh battery, this suggests that Europe's current lithium battery capacity can supply about 760,000 electric vehicles, and will be able to supply 8 million (2025) and 11.5 million (2030) in the future.

IEA data research shows that the global lithium-ion battery capacity will increase to 1300GWh in 2030. Existing and planned capacity in China is expected to reach 323GWh in 2023-2024, 65% of which is dominated by Chinese companies. European capacity is expected to reach 242GWh in 2023-2024, with 54% dominated by European companies and 40% dominated by Korean companies. Existing U.S. capacity is primarily Panasonic Tesla's Giga plant in Nevada, while a GM-South Korea joint venture will increase U.S. capacity by 46 percent. In Asia, Panasonic currently has a 20GWh factory in Japan, which is a 30GWh factory jointly built by India and a Korean company, and Thai entrepreneurs plan to build a 50GWh factory in Thailand. Tesla is the only U.S. manufacturer with plans to invest in Germany and China.

2. Lithium-ion battery raw materials and mineral processing supply chain

Lithium battery manufacturing relies on specific raw materials. Those are five minerals that are often identified as the core raw materials required by the industry; namely cobalt, graphite, lithium, nickel and rare earth minerals.

China's dominance in the lithium-ion battery supply chain

From battery extraction to refining and processing, China dominates the global battery mineral supply chain.

Mineral raw materials

China is a major producer of three of the six battery minerals: graphite (70%), rare earths (80%) and vanadium (56%).

Lithium: More than half of global lithium refining (primary lithium converted to carbonate or hydroxide) comes from China, although China produces only 9% of global primary lithium. Lithium comes in the form of salt in Latin America and spodumene, a hard rock ore, in Australia. Australia currently exports all spodumene concentrate lithium hydroxide processing to conversion plants in China. According to reports, China produces 80% of the world's lithium hydroxide.

Cobalt: Most of the world's cobalt is located in the Democratic Republic of Congo (DRC), and China is said to control the seven largest mines in the DRC, which supply China with 80% of the world's high-grade cobalt that can be used in batteries.

Graphite: In 2019, China was the only commercial producer of spherical graphite and negative electrode lithium batteries, controlling nearly 100% of graphite processing.

Nickel: China accounts for 29% of refined nickel.

Rare earths: China owns most of the world's rare earth resources and 85% of the world's rare earth processing capacity.

chemical processing

China produces 56 percent of the world's lithium-derivative chemicals in processing lithium carbonate or lithium hydroxide for use in battery manufacturing.

battery manufacturing

China accounts for 83% of global lithium-ion battery manufacturing, but this reflects China's dominance in lithium-ion battery manufacturing, with 75% of manufacturing used in consumer electronics batteries. China's demand for energy storage batteries is low, accounting for about 26% of global demand. Other large manufacturers or countries that demand lithium-ion batteries for energy storage are the United States (about 30%), the European Union (about 30%) and Japan (5-15%).

(Original from: Policy Futures Center Global Energy Storage Network, Global Lithium Battery Network, New Energy Network Comprehensive)