POSCO Chemical to bolster EV presence with 60,000-ton cathode plant

POSCO Chemical Co. will invest 600 billion won ($523 million) from 2022 to build a cathode materials plant in Pohang city with an annual capacity of 60,000 tons, in an action to follow up its long-term global expansion plan shared in April.

The secondary battery materials maker said on July 8 that it signed a partnership agreement with local governments of North Gyeongsang Province and Pohang city to build the new plant to address the fast-rising demand from the electric vehicle (EV) sector.

With the new plant, POSCO Chemical’s annual capacity of cathodes will be increased to 160,000 tons. The amount is large enough to power 1.8 million EVs with 60 kWh battery packs, according to the company.  

Cathodes are key materials used in making secondary batteries, taking up to around 40% of their manufacturing costs.

POSCO Chemical said in April that it will also set up cathode materials plants in China, the EU and the US to secure an additional capacity of 110,000 tons annually. The company had raised 1.27 trillion won ($1.13 billion) in January this year in rights offering, with aims to build cathode materials plants in the EU and the US simultaneously from next year.

After completing the construction of the overseas plants with a combined annual capacity of 110,000 tons, POSCO Chemical’s total annual capacity will add up to 260,000 tons globally, the largest in the world.

The global market is currently led by Belgium’s Umicore and Japan’s Sumitomo and Nichia, but none of them holds more than a 10% share of the market. POSCO Chemical says it will lead the market by 2030 with a 20% market share.

“The recent moves by the global automakers to internalize battery production and set up regional supply chains will provide growth opportunities for battery materials makers like us,” said POSCO Chemical CEO Min Kyung-joon.   

Write to Kyung-min Kang at kkm1026@hankyung.com
Daniel Cho edited this article.