Posco opens cathode battery material precursor plant in South Korea

South Korean battery materials maker Posco Future M Co recently completed a new precursor plant in the southern port city of Gwangyang.
The plant, with a capacity of 45,000 tonnes/year – enough to power approximately 500,000 electric vehicles – marks a milestone in the company’s efforts to reduce reliance on Chinese suppliers and fortify its position in the global electric-vehicle battery market, it adds.

The 22,400 sq m facility, within the company’s existing cathode production campus in the seaside city in South Jeolla Province, will produce precursors for high-nickel cathodes to be exported to Ultium Cells LLC, a US battery manufacturing joint venture between General Motors Co. and LG Energy Solution Ltd.

Precursors – chemical compounds containing key metals such as nickel, cobalt and manganese – are essential materials used in producing cathodes, making up nearly 70% of cathodes’ raw material costs.

More than 90% of the precursors used in cathode production in South Korea are imported from China.

With this new plant, Posco expects to significantly reduce its reliance on Chinese suppliers and improve its global competitiveness.

The move is also expected to enhance Posco’s eligibility for US tax credits under the Inflation Reduction Act (IRA), which excludes battery materials sourced from the US list of “Foreign Entities of Concern” (FEOCs), including China.

Posco operates cathode material production sites in Pohang and Gwangyang, churning out 150,000 tonnes/year of cathodes.

It also produces an additional 25,000 tonnes of cathodes from its manufacturing joint venture with Huayou in China and 30,000 tonnes via Ultium CAM, its jv with GM in Quebec, Cana