Can there be a need for 1024-bit (symmetric) encryption? I think we are all aware of the CAESAR-competition. Now the aim of this competition is to select a (portfolio of) winner(s) which provide authenticated encryption.
I'll now assume that the results produced by this competition are very good, meaning the cryptanalysis of the next 50+ (!) years won't yield any significant attacks (speed-up no more than $2^{80}$ compared to brute-force). Further it may be assumed that the scheme has 512-bit keys, to reach 256-bit security against quantum-computers.

So far for the assumptions, now to the background:
I recentely read this text by B. Schneier, where it was stated that the laws of thermodynamics disallow a counter to count to more than $2^{200}$, even in an ideal setting (3.2K, dyson sphere, kT for bit-flip,...). So I asked myself the following question as 512-bit seem to fully suffice forever (if we don't harvest the whole universe's energy...)

Now my question:
Besides performance and flexibility, will there ever be the need for 1024-bit symmetric encryption?
In order to answer this question, we need to understand the basis behind all of modern cryptography, which is computational hardness. Today, we believe that we know how to construct block ciphers that are secure, except for brute force search (or almost that secure). However, we don't really know this. We also think that factoring is hard, and so on. All of these are just assumptions since we don't know how to prove significant algorithmic lower bounds for problems like this. In particular, we don't even know how to prove that $P \neq NP$, and if $P=NP$ then no block cipher will be secure. Note, by the way, that even if $P\neq NP$, this doesn't suffice for crypto (we need one-way functions, which as an assumption is equivalent to pseudorandom functions/permutations).

Coming back to your question: assume that in 100 years it has been proven that $P\neq NP$ and even that one-way functions exist. However, assume also that all problems in $NP$ can be solved in time $2^{\sqrt n}$ where $n$ is the input length. (Note that it is strongly conjectured that $NP$-hard problems cannot be solved in sub-exponential time, but this is also an assumption.) In this case, if we want security against machines running in time $2^{128}$ then we will need keys of size 16384.  Another more likely possibility (but who knows) is that all $NP$ is solvable in time $2^{n/10}$. This would require keys of size $1280$.

Is this a likely event? Do I believe that this is the case? No, I don't! But, if you are asking: will such key lengths ever be needed? Well, no one really knows and the future will tell.

Currently we set key lengths by what we know. RSA needs 2048 bit keys due to the best factoring algorithms, and likewise discrete log and DDH over $\mathbb{Z}_p^*$; ECC needs 256-bit keys since the best algorithms known take time that is a square-root of the group size; symmetric keys need to be 128 bits since the best known attacks are brute force (and when better attacks are known then we phase out the algorithm).