POSCO Future M has broken into the cathode materials market for LFP batteries. The company has agreed to supply a large volume of cathode materials for long-term use in batteries for energy storage systems (ESS).

POSCO Future M announced on the 6th that it has reached an agreement with a leading domestic battery manufacturer for a large-scale long-term supply of cathode materials for LFP (lithium iron phosphate) batteries. This is POSCO Future M’s first order for cathode materials for LFP batteries. From next year through 2032, the company will supply more than 190,000 tons of LFP cathode materials to the battery manufacturer over six years. Specific contract terms are scheduled to be finalized in a formal contract in the third quarter. The company stated that the agreement was concluded to proactively respond to surging ESS demand in North America.

LFP batteries are batteries that use lithium, iron, and phosphate as the main raw materials for cathode materials. Compared with NCM (nickel cobalt manganese) ternary batteries, they are heavier and have lower energy density, but their manufacturing cost is lower and they offer superior safety, resulting in a lower fire risk. Their charge–discharge cycle life is also about twice as long as that of NCM batteries. Due to these characteristics, LFP batteries and cathode materials are considered the most suitable for ESS, where systems are stationary and weight is not a concern. Their ability to be used for a long time at lower cost than ternary batteries is another advantage. Recently, ESS has been drawing attention as a stable power supply solution in connection with rapidly increasing power demand, including for operating artificial intelligence (AI) data centers. POSCO Future M plans to produce and supply LFP cathode materials with enhanced cost competitiveness by applying a new process technology that utilizes iron oxide and other by-products from steelmaking processes, as well as lithium secured from brine lakes in Argentina, based on group-wide cooperation within POSCO Group. The company is reportedly in the final stages of negotiating LFP cathode material supply contracts with other customers as well. It intends to expand its LFP cathode production capacity in line with additional orders.

In terms of plant facilities, to ensure timely supply, the company recently completed the conversion of part of its high-nickel cathode production line at the Pohang plant into an LFP cathode production line. It is currently undergoing prototype certification from customers. Mass production and supply are scheduled to begin by the end of this year. A POSCO Future M official said, “We are seeking to expand anode and cathode material production capacity in line with growing global demand, and we are continuing supply discussions with global companies based on supply chains and technological capabilities that can respond to various trade regulations worldwide.”

In fact, in March this year, the company signed a large-scale long-term supply contract worth KRW 1 trillion for synthetic graphite anode materials with a global automaker. It is also pushing ahead with a plan to invest approximately KRW 357 billion to build a new synthetic graphite anode materials plant in Vietnam. In May, CNP Advanced Materials Technology, a joint venture between POSCO Future M and Pino-CNGR, began construction of an LFP cathode materials plant in the Yeongilman 4 General Industrial Complex in Pohang, targeting mass production in 2027. The plant plans to gradually expand its production capacity to a maximum of 50,000 tons.

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