In November 2024, the global energy storage lithium battery market continued to perform strongly, especially driven by the demand for large-scale energy storage systems (ESS), and the shipments of related battery continued to grow. Especially in the Chinese market, the advancement of grid connection projects at the end of the year has led to strong demand for energy storage battery. At the same time, due to the impact of the market supply chain, battery prices have shown a certain degree of stability, but are expected to rise slightly in 2025.
Energy storage lithium battery market demand
The demand for Solar energy storage lithium battery is mainly driven by two factors: on the one hand, the demand for grid connection in the Chinese market before the end of the year, and on the other hand, the growing demand for large-scale energy storage projects worldwide. Large-capacity battery quickly dominated the market due to their significant cost-effectiveness.
Under the combined effect of technological advancement and falling manufacturing costs, shipments of large-capacity battery have accounted for more than 40% of the overall market shipments, and this trend is expected to continue. In order to cope with cost pressure, battery manufacturers are also constantly optimizing production processes to improve overall efficiency.
Battery material price fluctuations
Although the price of cathode materials for LFP battery rebounded in November, the impact on the overall battery cost was small, and the price of LFP battery remained stable. In contrast, the demand for ternary battery has lagged relatively behind, and the continued decline in ternary material prices has led to a slight decline in ternary battery prices of about 2% in November.
In the field of energy storage battery, LFP battery still dominate the market due to their lower cost and longer service life. Although LFP cathode material prices rebounded, this price fluctuation did not have a significant impact on the overall cost of lithium-ion solar battery, so battery prices remained stable.
Supply chain and price pressure
In the second half of 2024, energy storage battery demand exceeded expectations, and battery manufacturers’ productivity remained at a high level. However, as the battery material price war that begins in 2023 continues, the oversupply of upstream raw materials still puts pressure on market prices. The prices of upstream raw materials such as LFP cathode materials, lithium battery copper foil, and lithium fluoride continue to decline, putting greater pressure on suppliers to make profits.
Currently, the lithium battery materials industry is facing long-term losses and a highly concentrated market structure. However, it is expected that in 2025, as market supply and demand conditions change, the prices of some materials may rise slightly during the peak season, which may ease the supply of raw materials. The business has suffered losses in recent years.
Market prospects
Despite the slowdown in order growth as grid connection projects were gradually completed at the end of the year, the demand for Stackable lithium-ion battery continued to grow steadily. As battery manufacturers continue to implement aggressive cost control measures, battery prices are likely to remain stable in the short term in 2025. In particular, battery prices are not expected to rise sharply against the backdrop of profit pressure on material suppliers.
However, as the market supply and demand relationship is still in a state of oversupply, price increases are expected to be limited. In addition, first-tier battery manufacturers may reserve room for price increases in 2025 orders to help upstream material suppliers achieve price recovery.
The energy storage lithium battery market is expected to continue to face potential pressure from rising material prices in 2025, but battery monomer prices are expected to remain relatively stable due to fierce market competition.