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Lithium Chloride Market Size, Share & Industry Analysis, By Application (Batteries, Ceramics & Glass, Lubricants, Polymer Production, Air Treatment, and Others) and Regional Forecast, 2024-2032

Last Updated: May 13, 2024 | Format: PDF | Report ID: FBI108063

 

KEY MARKET INSIGHTS

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The global lithium chloride market size was valued at 45.9 million tons in 2023 and is projected to grow from 49.7 million tons in 2024 to 95.7 million tons by 2032, exhibiting a CAGR of 8.5% during the forecast period.


Lithium chloride is a chemical compound, white in color, with the molecular formula LiCl. It is an ionic compound having covalent characteristics. It is hygroscopic in nature and soluble in polar solvents. It is mainly used for producing lithium for lithium-ion batteries. However, it is also used in other applications such as ceramics and glass, lubricants, polymer production, air treatment, and chemical synthesis & medical, among others. This wide range of applications of lithium chloride is responsible for its higher demand from several end-use industries, including automotive, electronics, chemical, and pharmaceutical.


During the COVID-19 pandemic, restrictions on movement and disruptions in supply chains in several countries across the world resulted in decreased product demand. However, lithium, as a drug used with other primary medications for COVID-19 treatment, helped retain minimum market growth during the pandemic.


Lithium Chloride Market Trends


Increasing Demand for Lithium-ion Batteries to Boost the Market Growth


Lithium chloride is a major source of lithium in lithium-ion batteries. Lithium-ion batteries provide several advantages over other types used in automotive, electronics, and renewable energy storage systems. The high energy density of lithium-ion batteries helps reduce the battery's size. This property makes it a best choice for most modern needs such as electric vehicles, mobiles, laptops, and others. Lithium-ion batteries also have low self-discharge. Unlike other batteries, such as nickel-cadmium batteries, lithium-ion batteries have a low maintenance cost.    


Lithium-ion batteries can be manufactured in all sizes and shapes, making them a perfect choice for power needs regardless of the size of the system. Further, lithium-ion batteries offer power solutions across a wide range of applications, from energy storage systems to portable energy solutions.


All these factors have increased the demand for lithium-ion batteries for modern needs, including electric vehicles, laptops, mobiles, and renewable energy storage systems. This increasing demand for lithium–ion batteries is anticipated to play a crucial role in driving the market growth.   


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Lithium Chloride Market Growth Factors


Rapidly Growing Automotive and Electronics Industries to Drive Market Growth


Lithium-ion batteries provide several advantages over other types of batteries, including high energy density at a relatively smaller size and storage of renewable energy coupled with its portability. The size of the battery system plays a vital role in batteries used in automotive and electronics. This factor has led to a tremendous increase in the demand for lithium-ion batteries from the automotive and electronics industries.


In the recent past automotive industry witnessed a noteworthy growth and is anticipated to grow substantially during the forecast period. For instance, global automotive sector accounts for around 3% of the world’s total output contributing substantially to the world’s overall GDP. This rate is higher in developing markets, such as India and China, which account for 7% of GDP. Further, lithium-ion batteries present significant opportunities for the electronic industry by providing high energy density in a relatively smaller size. Hence, the rapidly growing demand for electric vehicles is anticipated to present prominent opportunities for the market. Lithium–ion batteries have enabled the electronic industry to manufacture smart appliances with reduced size by providing high energy density. The increasing digitalization is pushing the demand for smart electronic devices, with reduced size. Therefore, the demand of the product is anticipated to rise continuously for manufacturing of batteries used in smart electronic devices, including laptops, smartphones, and tablets.


Increasing Product Demand in Ceramics & Glass Production and Air Treatment Applications to Drive Market Growth


The growing product demand in ceramics and glass production stems from its role as a flux, lowering the melting point of materials and enhancing their properties. In air treatment, the hygroscopic nature of lithium chloride makes it effective for absorbing moisture, a crucial aspect in applications, such as air conditioning and dehumidification systems. This dual demand will drive the market growth as industries seek efficient solutions for their manufacturing processes and environmental control needs. Additionally, the expanding use of the product in pharmaceuticals, metallurgy, and chemical synthesis will further boost the market progress. As industries continue to prioritize efficiency and sustainability, the versatile applications of the product position it as a key component in various sectors, propelling the market expansion.


RESTRAINING FACTORS


Continuously Rising Prices and Availability of Substitutes to Limit Market Growth


The world has limited lithium chloride resources, mainly concentrated in Argentina, Chile, and Bolivia, and a few sources in China, the U.S., and Australia. However, there is a continuous increase in global demand for the product. The post-pandemic period is further witnessing a drastic increase in product demand across the globe owing to the steadily growing automotive and electronics industries in different parts of the globe. Therefore, the increasing demand–supply gap, coupled with its limited reserves, is causing a continuous increase in the prices of lithium chloride. This continuous price increase is anticipated to negatively affect the market growth rate.


Lithium chloride can be effectively substituted by lithium hydroxide and lithium carbonate for different applications. Also, lithium chloride and lithium carbonate are efficient sources of lithium for different applications, including use in lithium-ion batteries. Therefore, the availability of substitutes is to limit the market growth. However, the relatively higher lithium carbonate and lithium hydroxide prices will present lucrative opportunities for the market.  


Lithium Chloride Market Segmentation Analysis


By Application Analysis


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Batteries Segment to Generate Highest Revenue Due to Increased Demand for Lithium-ion Batteries


Depending on the application, the market is segmented into batteries, ceramics & glass, lubricants, polymer production, air treatment, and others. The batteries segment held the significant share of the market in 2022 and is anticipated to retain its position during the forecast period. Lithium chloride is one of the major sources of lithium used for the production of batteries. Lithium-ion batteries are witnessing a high demand from automotive, electronics, and renewable energy storage systems. Lithium chloride itself is extensively used for the brazing flux for aluminum in automobile parts. Hence, the rapidly growing automotive industry, especially the increasing demand for electric vehicles, is anticipated to drive the lithium chloride market growth.


The recent past witnessed an increase in demand for passenger and luxury vehicles worldwide. Also, there is an increased quest for electric vehicles across the globe to reduce the carbon footprint. Superior characteristics of lithium-ion batteries, specifically the relatively small size with high energy density are pushing their demand from the automotive industry. Recently, there has been significant growth in the demand for cars. According to the European Automobile Manufacturer Association (ACEA), 12.8 million car units were sold in the EU in 2019.


REGIONAL INSIGHTS


Asia Pacific Lithium Chloride Market Size, 2023 (Million Ton)

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The market in Asia Pacific was 15.6 million tons in the year 2023. Rapidly growing industrialization in the developing economies in the region including China and India, is a key factor driving the market in the region. The economic expansion in this region is anticipated to support the growth of the electronics and automotive industries, further driving the demand of the product. The digitalization pushed by COVID-19 is anticipated to have a significant positive impact on the market growth in the region.


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North America held a significant global market share owing to higher product demand propelled by the well-developed automotive and electronics industry. A high standard of living coupled with mature demand for luxurious vehicles is anticipated to drive the growth of the electronic and automotive industry in the region. The measures to protect domestic industries and the different policies launched by the government for the industrial sector to recover from the COVID-19 impact are anticipated to propel market growth further.


Europe holds a considerable share of the market. Automotive and electronics industry in the region is witnessing continuous growth. Well-established electronics and automotive industries in Germany, France, U.K., are playing a key role in driving the market's growth. Many countries in the region, including Poland, Czech Republic, Slovakia, and Hungary, are advancing their value chains. The automotive industry is central to the economy of the region. For instance, in 2020, it contributed over 7% to the GDP of the European Union.


Recently, Latin America witnessed significant investment in the electronics and automotive sectors. For instance, the logistical proximity of Mexico as an exporter to the U.S. and Canada has caused increased investment from the U.S. in the automobile industry in the region. Rising industrialization in the region is anticipated to push the demand for electronic infrastructure, significantly driving the growth of the market in the region.


The Middle East and Africa are anticipated to witness considerable growth in the automotive and electronics sector by the end of the forecast period. GCC countries hold a considerable share of the market owing to the higher demand for automobiles in the region. Rising disposable income in the GCC countries and South Africa is anticipated to propel the growth of the automotive and electronics industry in the region, positively impacting the demand for the product. 


List of Key Companies in Lithium Chloride Market


Prominent Players in the Market are focusing on Acquiring Small Regional Players and Expansion of Production Capacity to Boost Revenues.


In terms of manufacturing, the market is consolidated in Latin America, North America, and Asia Pacific. However, in terms of consumption, Asia Pacific holds the largest share of the global market. Global key players, including Albemarle Corporation, Nippon Chemical Industrial CO., LTD., LEVERTON HELM LTD, and TOKYO CHEMICALS are using different marketing strategies to grow in the market. Major strategies used by the key players include acquisition or partnership with small regional players, expansion of production capacity, and partnership with local distributors of the product.


LIST OF KEY COMPANIES PROFILED:



KEY INDUSTRY DEVELOPMENTS



  • October 2022: Albemarle Lithium U.K. Limited, a subsidiary of Albemarle Corporation, acquired Guangxi Tianyuan New Energy Materials Co., Ltd. The move was anticipated to strengthen the ability of the company to meet the increasing demand for battery-grade lithium across the globe.

  • September 2020: The U.S. Department of Energy signed an agreement with Albemarle Corporation to partner on lithium research projects. The partnership was anticipated to enable efficient utilization of the lithium brine resource available in the Clayton Valley of Nevada.


REPORT COVERAGE


An Infographic Representation of Lithium Chloride Market

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The market research report provides qualitative and quantitative insights on the market share, growth rate, size, and regional analysis by different segments. The report also elaborates on the drivers, restraints, opportunities, and competitive landscape. Key insights such as PEST analysis, recent lithium chloride industry developments, and the regulatory scenario are also covered as part of the scope of the study.


REPORT SCOPE & SEGMENTATION













































ATTRIBUTE



DETAILS



Study Period



2019-2032



Base Year



2023



Estimated Year



2024



Forecast Period



2024-2032



Historical Period



2019-2022



Growth Rate



CAGR of 8.5% from 2024 to 2032



Unit



Volume (Million Ton)



Segmentation 



By Application



  • Batteries

  • Ceramics & Glass

  • Lubricants

  • Polymer Production

  • Air Treatment

  • Others



By Geography



  • North America (By Application, By Country)


    • U.S. (By Application)

    • Canada (By Application)


  • Europe (By Application, By Country)


    • Germany (By Application)

    • U.K. (By Application)

    • France (By Application)

    • Italy (By Application)

    • Rest of Europe (By Application)


  • Asia Pacific (By Application, By Country)


    • China (By Application)

    • India (By Application)

    • Japan (By Application)

    • Australia (By Application)

    • Rest of Asia Pacific (By Application)


  • Latin America (By Application, By Country)


    • Brazil (By Application)

    • Argentina (By Application)

    • Chile (By Application)

    • Rest of Latin America (By Application)


  • Middle East and Africa (By Application, By Country)


    • GCC (By Application)

    • South Africa (By Application)

    • Rest of Middle East & Africa (By Application)







Frequently Asked Questions

Fortune Business Insights says that the market was valued at 45.9 million tons in 2023 and is expected to reach 95.7 million tons by 2032.

Growing at a CAGR of 8.5%, the market will exhibit considerable growth over the forecast period.

The batteries segment is the leading application in the market.

Rapidly growing automotive and electronics industries are anticipated to drive market growth.

Asia Pacific currently holds the highest share in this market.

The increasing demand for lithium-ion batteries is the key trend in the market.

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