POSCO Group Initiates Leap to Global No.1 in Cathode and Anode Materials

GM and North American Expansion... Establishment of 'Ultium Camp' in Canada
Production of Cathode Materials for 220,000 Electric Vehicles... $330 Million Investment
Securing Key Raw Materials Lithium and Nickel through Direct and Indirect Investments

[Image source=Yonhap News]

[Asia Economy Reporter Oh Hyung-gil] POSCO Group is accelerating its business in cathode and anode materials used in electric vehicle batteries. The company plans to produce 610,000 tons of cathode materials by 2030, which is 152% more than its previous target.

According to industry sources on the 29th, POSCO Chemical has finalized a contract to establish a North American cathode material joint venture called 'Ultium CAM' with General Motors (GM).

The two companies will invest $327 million (approximately 460 billion KRW) to build a high-nickel cathode material joint factory with an annual capacity of 30,000 tons in Becancour, Quebec, Canada, capable of supplying batteries for about 220,000 electric vehicles. Construction will begin in August this year and is scheduled to be completed in the second half of 2024, with plans to gradually expand capacity in line with GM's electric vehicle business growth.

This joint venture will expand cooperation by additionally supplying cathode materials to 'Ultium Cells,' a battery joint venture between GM and LG Energy Solution, based in North America. POSCO Chemical was selected as a cathode material supplier for Ultium Cells in December 2020 and is expanding its production line with an annual capacity of 60,000 tons in Gwangyang, Korea, which is expected to be completed by July.

POSCO Group is laying the foundation to become the 'Global No.1 Company in Secondary Battery Materials by 2030' by expanding production capacity, including overseas supply of cathode materials.

The company is also advancing the production of lithium and nickel, key raw materials for cathode materials. POSCO Lithium Solution, a lithium ore production corporation established in April last year, changed its name to 'POSCO-Philbarra Lithium Solution' this year and started construction of a 43,000-ton lithium hydroxide plant in the Yulchon Industrial Complex in Gwangyang.

The lithium commercialization plant with an annual capacity of 25,000 tons in the Argentine salt lake, which began construction in March, will expand its mass production capacity to 50,000 tons by 2024 after completion.

To secure nickel, an essential element for high-capacity battery cathode materials, POSCO Group signed a contract in May last year to acquire a 30% stake in Australian nickel mining and smelting specialist 'Ravenswood' for $240 million (approximately 270 billion KRW), securing the right to receive 7,500 tons of nickel annually starting in 2024.

Additionally, the group is making a full-scale entry into the battery resource recycling business. 'POSCO HY Clean Metal,' which extracts nickel, lithium, and other materials from black powder recovered from used batteries, is constructing a plant on a 60,000㎡ site in the Yulchon Industrial Complex, aiming for completion in the second half of this year. It plans to extract nickel, lithium, cobalt, and other materials from 12,000 tons of black powder annually.

In the anode material sector, which is globally highly dependent on China, POSCO Group is taking an independent path.

Last year, the group diversified its supply sources of natural graphite, a raw material for anode materials, by acquiring a 15% stake in Australian mining company Black Rock Mining, which owns graphite mines in Tanzania, Africa, among other efforts.

POSCO Chemical is also leading domestic production of artificial graphite anode materials, which were previously fully imported. The company is gradually establishing a plant with an annual capacity of 16,000 tons (enough to supply 420,000 electric vehicles) in the Blue Valley National Industrial Complex in Pohang, Gyeongbuk Province, aiming for completion in 2023. The plant was completed last year with a capacity to produce 8,000 tons of artificial graphite, and production capacity is planned to expand to 150,000 tons by 2030.