POSCO breaks ground on $101 million battery recycling plant

South Korea’s top steelmaker POSCO on Thursday broke ground on its 120 billion won ($101 million) plant to extract nickel, lithium and cobalt, key materials for rechargeable batteries.

The plant, set to be completed by the second half of next year, is capable of extracting 12,000 tons a year of the three raw materials from black mass, which contains high amounts of nickel, lithium, cobalt and manganese after spent batteries are shredded.

To be located in the Yulchon Industrial Complex in South Jeolla Province, the recycling plant will be built by POSCO HY Clean Metal Co., a 65-35 joint venture between POSCO and China’s Huayou Cobalt Co. set up in May.

POSCO said it will receive black mass from its Polish subsidiary, Poland Legnica Sourcing Center.

With the steady rollout of electric vehicles across the globe, the secondary battery recycling market is forecast to expand to 28 trillion won by 2040, according to industry estimates.

POSCO said it may ramp up its battery recycling facilities if demand grows at a faster rate.

KEY GROWTH DRIVERS

“The EV battery recycling business will be one of our key growth drivers. We will continue to invest in this business to develop related technology and expand facilities,” said Chung Chang-hwa, head of POSCO’s growth business division at the groundbreaking ceremony.

POSCO has been pushing to boost its EV battery and materials business as part of a diversification strategy.

In January, POSCO Chemical Co. acquired a 15% stake for $7.5 million in Black Rock Mining, an Australia-based mining company that owns the Mahenge graphite mine in Tanzania, Africa.

Graphite is an essential anode material used in making electric vehicle batteries.

Last month, POSCO Chemical said it is investing 4.9 billion won to acquire a 13% stake in Qingdao Zhongshuo New Energy Technology Co., a Chinese graphite processing firm.

In Korea, POSCO maintains an EV battery material value chain from the supply of raw materials such as lithium, nickel and cobalt to the production of anodes and cathodes.

The company plans to supply 220,000 tons of lithium and 100,000 tons of nickel by 2030.

It also plans to expand its facilities to produce 400,000 tons of cathodes and 260,000 tons of anodes worth 23 trillion won in revenue by 2030.

Write to Kyung-Min Kang at Kkm1026@hankyung.com
In-Soo Nam edited this article.