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Massive 720,000-ton battery materials deal to supercharge cheaper EVs, data centers

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Massive 720,000-ton battery materials deal to supercharge cheaper EVs, data centers

The South Korean battery materials maker signed a Future Cooperation Memorandum of Understanding (MOU) with battery giant LG Energy Solution. 

POSCO Future M will supply a 720,000 tons of cathode and anode materials to LG Energy Solution over a seven-year span running from 2027 to 2033. A formal binding contract is scheduled for completion within the year. 

The seven-year alliance focuses on supplying critical lithium iron phosphate (LFP) cathodes and synthetic graphite anodes to meet surging demand for affordable EVs and data center energy storage systems.

The global battery market is shifting away from a sole focus on high-nickel energy density to prioritize cost, fast-charging speed, and supply chain resilience. Growing demand for affordable electric vehicles, along with massive energy needs from AI data centers, has driven this strategic pivot. 

Automobile and energy companies are now retooling their technology choices to balance budget-friendly performance with reliable material sourcing.

POSCO Future M is converting high-nickel production lines at its Pohang manufacturing facility to produce lithium iron phosphate (LFP) cathodes. Full-scale shipments to LG Energy Solution will start early next year. These LFP materials will power an expanding lineup of affordable electric vehicles and energy storage systems, marking a strategic operational change for the company.

Long-term cost savings will extend deep into the raw material supply chain. POSCO Group is using its raw resource footprint, tapping brine from lithium salt lakes in Argentina to design next-generation LFP processes with unmatched price competitiveness. 

Also, mid- to long-term production of standard ternary NCM cathodes will increasingly incorporate metals recovered directly from recycled batteries.


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