Posco completes Chinese battery materials plant
South Korean steel producer Posco has completed construction of its first overseas battery materials plant located in China, with it aiming to start commercial production by the end of this year.
The plant in east China's Zhejiang province will have capacity to produce 5,000 t/yr of cathodes, one of the key materials for lithium-ion electric vehicle (EV) batteries. Posco fast-tracked the project because of rising EV demand, completing the plant one year ahead of schedule.
Certification of such factories normally takes about a year, but Posco said last month that it was trying to speed up the process to begin selling its first product batches in February.
The plant is a 60:40 joint venture between Posco and China's Huayou Cobalt that secured a stable source of raw materials, including cobalt. Key Chinese EV battery producers, such as CATL, have factories located nearby, giving the Posco-Huayou venture a proximity advantage over some competitors.
Posco is betting on battery materials as a key growth segment amid relatively little expansion potential in its core steel business. The company aims to capture a 20pc share of the global battery materials market by 2022, forecasting the industry to triple in size by 2025. The Zhejiang plant will increase Posco's cathode output to 20,000 t/yr, with capacity targeted to rise to 62,000 t/yr by 2022, which is enough to supply batteries for more than 750,000 EVs.
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