Cathode materials producers keep on expanding

Battery cathode material makers are continuing their investment. This is because the production of battery cells increased due to the launch of new EV models, which call for more cathode materials.

The expansion and new investment of four major cathode material companies in South Korea are continuing this year. Ecopro in June, it announced that it would invest 86.5 billion won in the production of cathode materials for SK innovation. The company will spend 300 billion won over the next five years to build a material ecosystem such as production and recycling of cathode materials. The total investment is 1.5 trillion won.

Cosmo New Materials, a mid-sized cathode material company, acquired the precursor production line of Samsung SDI’s cathode material subsidiary STM. They spent 312 billion won. In August of last year, Cosmo announced that it would prepare a production line for cathode materials by spending 43 billion won. The precursor is one of the raw materials for the cathode material. It is made into a cathode material by mixing lithium hydroxide and accounts for about 80% of the cathode material cost.

POSCO Chemical announced the investment in cathode materials for the second year in a row. It announced that it will execute 2191 billion won in February last year and 289.5 billion won on the 5th of this month. The goal is to expand the second and third stages of the Gwangyang plant. The Gwangyang plant is designed to produce 90,000 tons of cathode materials per year. The addition of the Gumi plant (10,000 tons per year), which is designated for other types of cathode materials, will secure the ability to produce 100,000 tons per year of cathode materials by 2023.

L&F announced in February of last year that it would invest 70 billion won in the second stage expansion of the cathode material plant. Initially, the expansion was scheduled to be completed by June this year, but the constructions was delayed slightly to March next year with coronavirus pandemic. This year, it plans to raise funds necessary for plant expansion in the form of a paid-in capital increase. Additional investment is expected at the end of phase 2 expansion.

The cathode material maker’s capacity expansion is expected to continue next year. Battery cell makers are also steadily increasing production through further expansions. As of the end of this year, LG Chem, Samsung SDI, and SK Innovation are expected to have production capacities of 100 GWh, 30 GWh, and 40 GWh, respectively. Expansion is planned to continue until 2025. It is expected to more than double this year.

RR