Costs, Chemistries, and Demand of Critical Battery Materials

Different battery chemistries all have their own unique cost profiles and electrochemical performances, including energy densities and cycle lives, with some suiting specific applications better than others. IDTechEx's report, "Critical Battery Materials 2025-2035: Technologies, Players, Markets, and Forecasts" explores how the types of battery chemistries used and developed most commonly influence material demand across the entire sector.

 

 

Lithium cobalt oxide (LCO), lithium iron phosphate (LFP), and nickel manganese cobalt oxide (NMC) are amongst the most common battery types, with the majority of the Li-ion battery demand being driven by, but not limited to, the EV sector. IDTechEx's report highlights that cathode materials used in batteries are some of the largest influencers of mass, cost, and demand.

 

The mass proportions of components within a lithium-ion cell will change depending on the chemistry, however, IDTechEx's research demonstrates that the cathode active material is the largest contributor to cell mass. The anode active material, typically graphite, is the second largest component, followed by inactive materials including formulated electrolyte, cell casing, conductive additives, and binders.

 

Cost breakdowns of cell materials within the report show that cathodes are also the largest contributor to cell material cost when paired with graphite anodes, though these costs are dependent on which chemistry, and hence, which metals are used. The falling lithium prices in recent years have made batteries more affordable, somewhat mitigating the increased cathode costs.

 

 

While different cell chemistries require different amounts of material, the cathode chemistry largely determines demand for materials like nickel, manganese, cobalt, and iron, whereas lithium and graphite demands are less sensitive to chemistry choice. IDTechEx forecasts that graphite and lithium demand is expected to triple by 2035, while manganese demand is expected to grow six times the current amount, and nickel four. Cobalt and copper demand is only expected to double.

 

The main factors affecting these demand increases outlined within IDTechEx's report include Li-ion battery demand, largely driven by the EV sector. The key chemistry trend directly influencing the demand for nickel, manganese, cobalt, and iron is the increased uptake of LFP, and the adoption of LMFP that could alleviate nickel demand and increase manganese demand.

 

The supply for these materials is currently struggling to keep up with this demand, with lithium expected to see the fastest growth in supply from mining, and cobalt, copper, and nickel being slower. The growing adoption of direct lithium extraction technologies (DLE) without the need for ponds is one of the main contributing factors to growing lithium supply. IDTechEx's report, "Direct Lithium Extraction 2025-2035: Technologies, Players, Markets and Forecasts" goes into detail about the processes becoming utilized to source lithium and their drivers and barriers to adoption.

 

Deep sea mining could potentially be a successful future method for sourcing critical minerals, driven by rising material demand, the desire to utilize large and high-grade resources that are available, and the need for diversifying the supply chain. Defence and construction are other industries aside from electric vehicles that require these materials, presenting other motives for developing this technology. However, this is currently an immature market with little economic viability, and the environmental impact isn't currently clear.

 

 

Increasing policies and regulations are reflecting the need for sustainability awareness throughout the battery lifecycle. While the production and sourcing of raw materials are necessary for battery manufacturing, understanding the carbon emissions generated as a result and implementing ways to reduce their effects are crucial.

 

IDTechEx concludes that raw battery materials have a wide range of emission intensities due to the difference in sources, production routes, and power sources. Nickel has the widest emission range, closely followed by graphite, with the sourcing of these materials largely influencing the emission profile of a battery. With impending regulations like the battery passport in Europe, how manufacturers calculate these impacts and the choices they make in their supply chain become ever more crucial.

 

For more information, visit IDTechEx's report, "Critical Battery Materials 2025-2035: Technologies, Players, Markets, and Forecasts", and the wider portfolio of Advanced Materials & Critical Minerals Research Reports and Subscriptions.