Posco Future M to invest $300 million to build high-nickel cathode plant

Rendering image of Posco Future M's cathode plant in Pohang, North Gyeongsang [POSCO FUTURE M]

Posco Future M will invest 392 billion won ($300 million) to build a high-nickel cathode plant in Pohang, to seize the opportunity that is the growing demand for the high-density battery.

The facility in North Gyeongsang will produce 30,000 tons of high-nickel nickel-cobalt-aluminum (NCA) cathodes annually, which is enough to supply batteries for 300,000 EVs.

The investment comes as the company signed a 40-trillion-won and 10-year supply deal with Samsung SDI in late January.

NCA cathodes are known for their efficiency in maximizing a battery's energy density and output. Cathodes are one of four core materials in batteries that play a vital role in deciding the price of a battery because they account for up to 40 percent of a battery's cost.

Ground will be broken in the first half, with the goal of starting production in 2025.

The plant will boost Posco Future M's cathode production capacity to 60,000 tons by 2025. The company is currently building another 30,000-ton cathode plant at the same site in Pohang.

Since starting its cathode business in 2012, Posco Future M currently has five cathode products lined up.

It is in the process of developing a lithium iron phosphate, or LFP, battery, to diversify its portfolio.

LFP batteries, largely controlled by Chinese manufacturers, have less energy density but cost less and have lower fire risks.

Posco Chemical changed its name to Posco Future M on Monday to better capture its focus on the battery material business.

BY SARAH CHEA [chea.sarah@joongang.co.kr]