POSCO Future M (003670) is breaking ground on a dedicated lithium iron phosphate (LFP) cathode plant to address the battery materials market for energy storage systems (ESS) and entry-level electric vehicles.
POSCO Future M held a groundbreaking ceremony at the Yeongil Bay 4 General Industrial Complex in Pohang with C&P New Materials Technology, a joint venture between Pinot and China's CNGR, to begin construction of the LFP cathode plant, the company said Friday.
The plant targets mass production in 2027, with plans to gradually expand annual production capacity up to 50,000 tons.
POSCO Future M previously held a board meeting in December last year to approve the LFP cathode plant construction agenda and subsequently signed a joint venture agreement (JVA) with its partners.
LFP offers lower output than ternary batteries such as nickel-cobalt-manganese (NCM) and nickel-cobalt-aluminum (NCA), but is cheaper and has a longer lifespan. Demand for LFP batteries for ESS is growing, driven by the recent expansion of renewable energy use and increased power demand from the proliferation of artificial intelligence (AI) data centers. In the EV market, the use of LFP batteries is also expanding, particularly for entry-level electric vehicles.
As a result, major battery makers are signing LFP battery supply contracts and expanding production capacity, mainly in North America and Europe. They are also requesting prompt supply of Korean-made materials to respond to trade policies in various countries and demands for supply chain diversification.
With this groundbreaking, POSCO Future M plans to diversify its product lineup with LFP cathodes alongside its mainstream ternary materials, strengthening its competitiveness in winning orders.
Separately, POSCO Future M is retrofitting part of the high-nickel ternary product line at its existing Pohang cathode plant into an LFP cathode production line. The company plans to begin prototype production in the second quarter and ramp up to full mass production in the second half of the year.
