POSCO Chemical breaks ground for EV battery materials plant in Pohang

POSCO Chemical CEO Min Kyung-zoon speaks during the groundbreaking ceremony for the company's high-nickel cathode materials factory in Pohang, North Gyeongsang Province, Thursday. Courtesy of POSCO Chemical

By Park Jae-hyuk

POSCO Chemical started construction on a high-nickel cathode material factory in Pohang, North Gyeongsang Province, Thursday, two weeks after POSCO Group broke ground for its lithium plant in Argentina.

The chemical firm said that the new factory's construction is part of its efforts to grow into an eco-friendly materials manufacturer and to increase investments in POSCO's hometown of Pohang, where POSCO Chemical completed the construction of Korea's first synthetic graphite anode plant in 2021.

According to the company, 290 billion won ($238 million) has been invested in its new factory which will begin producing 30,000 tons of cathode materials annually from 2024.

It plans to make additional investments to increase the factory's annual production capacity to 60,000 tons by 2025 ― an amount that can be used to equip batteries in 600,000 high-performance electric vehicles (EVs).

POSCO Chemical expects the new factory to play a key role in the company taking the initiative in next-generation materials, given that the factory will produce cathode materials with nickel, cobalt, manganese and aluminum, which can enhance the stability and mileage of EVs.

Once the factory starts operations, POSCO Chemical will be ready for the rising demand for cathode materials for high-performance EVs, by producing up to 160,000 tons of cathode materials annually through its manufacturing facilities in Pohang, as well as in Gwangyang, South Jeolla Province, and Gumi, North Gyeongsang Province.

It also seeks to produce a combined 115,000 tons of cathode materials annually in North America, China, Europe and Indonesia, which are considered the largest markets for EVs.

“We have been able to construct our value chain for the EV battery business, by securing lithium and nickel from POSCO Group,” POSCO Chemical CEO Min Kyung-zoon said during the groundbreaking ceremony. “The new cathode materials factory in Pohang will be the center of the battery materials industry.”

POSCO Chemical said the ceremony was attended by around 100 participants, including North Gyeongsang Province Governor Lee Cheol-woo, Pohang Mayor Lee Kang-deok and lawmakers representing Pohang residents.

POSCO Group Chairman Choi Jeong-woo did not pay a visit, although he had been expected to meet with the Pohang mayor at the event and discuss the planned relocation of the group's holding firm to the port city from Seoul.