POSCO Future M to Invest 1.7 Trillion KRW in Precursor and Anode Material Plants in Pohang

HwaYu Cobalt, Gyeongsangbuk-do, and Pohang City Sign MOU
Completing the 'Nickel-Precursor-Cathode Material' Value Chain

POSCO Future M will invest a total of 1.7 trillion KRW in Pohang to build factories for precursor materials for cathode and anode production.

On the 3rd, POSCO Future M announced that it signed a memorandum of understanding (MOU) on this investment with China Huayou Cobalt, the world's largest cobalt producer, Gyeongsangbuk-do Province, and Pohang City.

POSCO Future M will first establish a joint venture with Huayou Cobalt and invest about 1.2 trillion KRW to build production lines for battery cathode precursor materials and high-purity nickel raw materials. The factory is scheduled to be built by 2027 on a 267,702m² (approximately 80,000 pyeong) site within the Pohang Blue Valley Industrial Complex.

POSCO Future M announced on the 3rd that it has decided to establish a battery materials factory in Pohang in collaboration with China’s Huayou Cobalt and others. The photo shows officials including Kim Hyun-hong, Deputy General Manager of Zhejiang Pohua, a joint venture between POSCO Future M and Huayou Cobalt (fifth from the left), and Zhang Zhanhong, Advisor to the President of Huayou Cobalt (fourth from the left), posing for a commemorative photo at an outdoor basketball court donation event held in Tongxiang City, the location of the joint venture, in August 2021. Photo by POSCO Future M

Precursor materials are intermediate cathode materials manufactured by processing raw materials such as nickel, cobalt, and manganese. Domestic production accounts for only about 13%. Expanding production capacity is essential to strengthen the competitiveness of K-batteries. Nickel, which determines the energy storage density of batteries, also has the highest usage ratio among precursor raw materials, making internalization important.

POSCO Future M plans to complete a 'nickel-precursor-cathode' value chain cluster by linking with the cathode production base under construction in the Yeongilman General Industrial Complex in Pohang, which has an annual production capacity of 106,000 tons. Through this, it expects to secure high-quality raw materials at competitive prices and further improve the profitability of its battery materials business. POSCO Future M currently has a global cathode production capacity of 105,000 tons per year and plans to expand it to 610,000 tons by 2030. It will also increase precursor production capacity from 15,000 tons to 440,000 tons annually, raising the self-production ratio of precursors from 14% to 73%.

POSCO Future M will also invest about 500 billion KRW to build an additional anode production factory in Pohang. The factory is planned to be constructed by 2025 on a 199,720m² (approximately 60,000 pyeong) site within the Pohang Blue Valley Industrial Complex.

Anode materials are key components that determine battery life and charging performance. POSCO Future M is the only company in Korea mass-producing graphite-based anode materials. Currently, POSCO Future M produces 74,000 tons of natural graphite anode materials in Sejong and 8,000 tons of artificial graphite anode materials in Pohang. To respond to the increasing demand for anode materials due to the growth of the electric vehicle market, it plans to expand production capacity to 320,000 tons by 2030.

President Kim said, “As a company producing both cathode and anode materials, which are core battery materials, we will advance the full value chain from raw materials to final product production and proactively respond to customer requests arising from the reorganization of regional supply chains.”