[Concall] POSCO Holdings "Lithium Supply Shortage Continues... Maintaining $60,000 Until 2025"

2022 Performance Announcement

[Asia Economy Reporter Choi Seoyoon] POSCO Holdings stated during the Q4 earnings conference call held on the 27th that regarding the lithium business, "The first phase of the Gwangyang POSCO Pilbara Lithium Solutions project is progressing smoothly according to plan and is scheduled to be completed in October this year," adding, "The remaining phases are planned to be completed by February next year."

They also said, "In Argentina, the civil engineering and construction work for the first phase with a scale of 25,000 tons is progressing smoothly," and "major facilities in Argentina will be installed by the end of this year and completed by April 2024." Furthermore, they added, "For the second phase of Argentina brine, the board approved it last October for 25,000 tons, and the corporate establishment for the Gwangyang lithium hydroxide plant has been completed. The third plant in Argentina and the fourth plant in Gwangyang are scheduled to begin construction as planned in June this year."

Regarding the lithium market, POSCO Holdings said, "Although lithium prices have recently dropped, looking at the original lithium prices, they rose to $81,000 per ton in December last year due to several factors such as pre-holiday stockpiling of lithium demand, and the price announced before the Lunar New Year was $72,700," adding, "We continue to see a long-term supply shortage of lithium." Wood Mackenzie forecasted the price of lithium hydroxide in 2023 to be around $68,800. POSCO Holdings expects prices to remain between $60,000 and $70,000 in 2024 and 2025, stating, "At a lithium conference held in the U.S. last June, the industry average price was mentioned as $50,000 to $60,000, and this trend is expected to continue in the mid to long term with no significant changes in the market."

They also said, "For reference, 10.5 million electric vehicles (EVs) were sold worldwide last year. The initial estimate was about 9.3 million units, but despite ongoing recession concerns every year, sales exceeded expectations," adding, "Although Tesla's sales have been sluggish, leading to price reductions, the overall EV market has remained strong as other OEMs increased their sales by an amount equivalent to Tesla's decline." They continued, "POSCO's secondary battery investments are accelerating gradually beyond the original plan."