Posco Future M to supply 720,000 tons of battery materials to LG Energy Solution over 7 years

Posco Future M said Friday it has signed a "future cooperation MOU" with LG Energy Solution to expand their partnership to include lithium iron phosphate (LFP) cathode materials and artificial graphite anode materials, as the two companies seek to jointly navigate the rapidly shifting electric vehicle (EV), energy storage system (ESS) and global trade environment.

Under the agreement, Posco Future M is expected to supply a total of 720,000 tons of cathode and anode materials to LG Energy Solution over seven years from 2027 to 2033. The two companies plan to finalize a formal contract by year-end, with a concrete product diversification and supply roadmap for both material types.

The MOU covers the supply and joint technology development of next-generation products, including LFP cathode materials, artificial graphite anode materials, ultra-high-nickel cathode materials, sodium-ion battery materials and silicon anode materials.

For the nickel-cobalt-manganese (NCM) ternary cathode materials Posco Future M has long supplied to LG Energy Solution, the company plans to gradually increase the use of recovered metals extracted from spent batteries to improve cost competitiveness. The partnership will also extend to LFP cathode materials, demand for which is rising on the back of expanding AI data center capacity and growing sales of affordable electric vehicles.

As a first step, Posco Future M will convert a high-nickel ternary cathode production line at its Pohang factory to an LFP cathode line, with full-scale supply to LG Energy Solution set to begin in early 2027. The company then plans to develop a new production process using lithium from the Posco Group's brine deposits in Argentina to supply next-generation LFP cathode materials with improved cost competitiveness and quality.

Artificial graphite anode materials — which offer advantages for fast-charging performance and battery longevity — will be produced in South Korea and Vietnam for supply to LG Energy Solution.

The two companies will also cooperate on technology development and supply of future battery materials, including materials for sodium-ion batteries (SIB), ultra-high-nickel cathode materials and silicon anode materials. They also agreed to jointly develop responses should global supply chain issues arise or be anticipated, such as the introduction of the US Prohibited Foreign Entity (PFE) requirements or the announcement of Europe's Industrial Acceleration Act (IAA).

In July, Posco Group unveiled its future growth strategy, presenting a vision to build a "Triple-core" framework spanning steel as an industrial resource, lithium, cathode and anode materials, and rare earths as strategic resources, and LNG and renewable energy as energy resources — positioning the group as a national-champion supplier of core resources.

Posco Future M said it will strengthen its competitiveness in the cathode and anode materials business by leveraging the group's internal value chain — including lithium brine deposits and graphite mines — to cement its standing as the Posco Group's key strategic-resource company.