Electrification
Graphite: An Essential Material in the Battery Supply Chain
The following content is sponsored by Northern Graphite
Graphite: An Essential Material in the Battery Supply Chain
The demand for lithium-ion (Li-ion) batteries has skyrocketed in recent years due to the increasing popularity of electric vehicles (EVs) and renewable energy storage systems.
What many people don’t realize, however, is that the key component of these batteries is not just lithium, but also graphite.
Graphite represents almost 50% of the materials needed for batteries by weight, regardless of the chemistry. In Li-ion batteries specifically, graphite makes up the anode, which is the negative electrode responsible for storing and releasing electrons during the charging and discharging process.
To explore just how essential graphite is in the battery supply chain, this infographic sponsored by Northern Graphite dives into how the anode of a Li-ion battery is made.
What is Graphite?
Graphite is a naturally occurring form of carbon that is used in a wide range of industrial applications, including in synthetic diamonds, EV Li-ion batteries, pencils, lubricants, and semiconductor substrates.
It is stable, high-performing, and reusable. While it comes in many different grades and forms, battery-grade graphite falls into one of two classes: natural or synthetic.
Natural graphite is produced by mining naturally occurring mineral deposits. This method produces only one to two kilograms of CO2 emissions per kilogram of graphite.
Synthetic graphite, on the other hand, is produced by the treatment of petroleum coke and coal tar, producing nearly 5 kg of CO2 per kilogram of graphite along with other harmful emissions such as sulfur oxide and nitrogen oxide.
A Closer Look: How Graphite Turns into a Li-ion Battery Anode
The battery anode production process is composed of four overarching steps. These are:
- Mining
- Shaping
- Purifying
- Coating
Each of these stages results in various forms of graphite with different end-uses.
For instance, the micronized graphite that results from the shaping process can be used in plastic additives. On the other hand, only coated spherical purified graphite that went through all four of the above stages can be used in EV Li-ion batteries.
The Graphite Supply Chain
Despite its growing use in the energy transition all around the world, around 70% of the world’s graphite currently comes from China.
With scarce alternatives to be used in batteries, however, achieving supply security in North America is crucial, and it is using more environmentally friendly approaches to graphite processing.
With a lower environmental footprint and lower production costs, natural graphite serves as the anode material for a greener future.
Click here to learn more about how Northern Graphite plans to build the largest Battery Anode Material (BAM) plant in North America.
Electrification
Charted: Lithium-Ion Batteries Keep Getting Cheaper
Cell prices have fallen 73% since 2014.
Lithium-Ion Batteries Keep Getting Cheaper
Battery metal prices have struggled as a surge in new production overwhelmed demand, coinciding with a slowdown in electric vehicle adoption.
Lithium prices, for example, have plummeted nearly 90% since the late 2022 peak, leading to mine closures and impacting the price of lithium-ion batteries used in EVs.
This graphic uses exclusive data from our partner Benchmark Mineral Intelligence to show the evolution of lithium-ion battery prices over the last 10 years.
More than Half of the Battery Price Comes from the Cathode
Lithium-ion batteries operate by collecting current and directing it into the battery during the charging process. Typically, a graphite anode attracts lithium ions and retains them as a charge.
During discharge, the cathode draws the stored lithium ions and channels them to another current collector. The circuit functions effectively because the anode and cathode do not come into direct contact and are suspended in a medium that facilitates the easy flow of ions.
Currently, 54% of the cell price comes from the cathode, 18% from the anode, and 28% from other components.
Declining Prices
The average price of lithium-ion battery cells dropped from $290 per kilowatt-hour in 2014 to $103 in 2023.
| Year | Global Avg. Cell Price ($ per kilowatt-hour) |
|---|---|
| 2014 | 290 |
| 2015 | 230 |
| 2016 | 180 |
| 2017 | 140 |
| 2018 | 128 |
| 2019 | 120 |
| 2020 | 110 |
| 2021 | 99 |
| 2022 | 129 |
| 2023 | 103 |
| 2024 (ytd) | 78 |
In the coming months, prices are expected to drop further due to oversupply from China.
Despite declining prices, battery demand is projected to increase ninefold by 2040, with the battery industry’s total capital expenditure expected to nearly triple, rising from $567 billion in 2030 to $1.6 trillion in 2040.
| Lithium ion Battery Market Size | Global Capacity (Gigawatt hour) |
|---|---|
| 2016 | 163 |
| 2017 | 219 |
| 2018 | 353 |
| 2019 | 496 |
| 2020 | 710 |
| 2021 | 1026 |
| 2022 | 1652 |
| 2023 | 2555 |
| 2024F | 3476 |
Learn More About Batteries From Visual Capitalist
If you enjoyed this post, be sure to check out this graphic that ranks the top lithium-ion battery producing countries by their forecasted capacity in 2030.
Electrification
Ranked: The Top Lithium-Ion Battery Producing Countries by 2030
Chinese companies are expected to hold nearly 70% of global battery capacity by decade’s end.
Top Lithium-Ion Battery Producers by 2030
Lithium-ion batteries are essential for a clean economy due to their high energy density and efficiency. They power most portable consumer electronics, such as cell phones and laptops, and are used in the majority of today’s electric vehicles.
This graphic uses exclusive data from our partner, Benchmark Mineral Intelligence, to rank the top lithium-ion battery producing countries by their forecasted capacity (measured in gigawatt-hours or GWh) in 2030.
China to Keep Dominance
Chinese companies are expected to account for nearly 70% of global battery capacity by 2030, delivering over 6,200 gigawatt-hours. Chinese giant Contemporary Amperex Technology Co., Limited (CATL) alone is forecasted to produce more than the combined output from Canada, France, Hungary, Germany, and the UK.
| Country | 2030F capacity (GWh) | Top producers |
|---|---|---|
| 🇨🇳 China | 6,268.3 | CATL, BYD, CALB |
| 🇺🇸 U.S. | 1,260.6 | Tesla, LGES, SK On |
| 🇩🇪 Germany | 261.8 | Tesla, Northvolt, VW |
| 🇭🇺 Hungary | 210.1 | CATL, SK On, Samsung |
| 🇨🇦 Canada | 203.8 | Northvolt, LGES, VW |
| 🇫🇷 France | 162.0 | Verkor, Prologium, ACC |
| 🇰🇷 South Korea | 94.5 | LGES, Samsung, SK On |
| 🇬🇧 UK | 66.9 | Envision, Tata |
Currently, China is home to six of the world’s 10 biggest battery makers. China’s battery dominance is driven by its vertical integration across the entire EV supply chain, from mining metals to producing EVs.
By 2030, the U.S. is expected to be second in battery capacity after China, with 1,261 gigawatt-hours, led by LG Energy Solution and Tesla.
In Europe, Germany is forecasted to lead in lithium-ion battery production, with 262 gigawatt-hours, most of it coming from Tesla. The company currently operates its Giga Berlin plant in the country, Tesla’s first manufacturing location in Europe.
Learn More About Batteries From Visual Capitalist
If you enjoyed this post, be sure to check out Charted: Investment Needed to Meet Battery Demand by 2040. This visualization shows the total capital expenditure (capex) requirements to build capacity to meet future battery demand by 2030 and 2040.
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