POSCO Future M to build LFP plant for ESS batteries

POSCO Future M's cathode materials plant in Pohang, North Gyeongsang Province / Courtesy of POSCO Future M

POSCO Future M has decided to build a lithium iron phosphate (LFP) plant dedicated to supplying cathode materials for batteries used in energy storage systems (ESS).

The battery materials unit of POSCO Group said Tuesday that its board of directors has approved the construction of a new factory in Pohang, North Gyeongsang Province, to meet the growing global demand for LFP batteries for ESS projects.

Mass production is scheduled to begin in 2027, and construction of the new plant is expected to begin sometime next year.

“We are currently focusing on cathode materials composed of nickel, cobalt and manganese (NCM) or nickel, cobalt and aluminum (NCA)," a POSCO Future M official said. "The investment in the new LFP plant will help us diversify our products and strengthen our competitiveness in the global market."

For the construction, POSCO Future M will make an additional investment in C&P Advanced Technology, its joint venture with China’s CNGR. Through the planned investment, the company aims to produce up to 50,000 tons of LFP annually.

POSCO Future M will also convert some NCM production lines at its existing Pohang cathode materials plant to start LFP production by the end of next year.

Although LFP batteries have lower energy density than NCM and NCA batteries, they are more affordable and have longer lifespans, making them attractive for ESS projects and entry-level electric vehicles.

With growing North American demand for LFP batteries for ESS applications, major Korean battery makers have also converted their ternary battery production lines to make LFP batteries. They have called for an immediate supply of Korean-made materials.