On May 31, POSCO Group and China’s CNGR, the world’s largest precursor company, broke ground on nickel and precursor production plants for secondary batteries in Pohang, South Korea.
POSCO CNGR Nickel Solution, a joint venture with a 60:40 equity split between POSCO Holdings and CNGR, will produce 50,000 tons of high-purity nickel annually, sufficient for 1.2 million electric vehicles, to be used as precursor material.
CNP New Material Technology, utilizing high-purity nickel, will produce 110,000 tons of precursors annually, established as a joint venture with an 80:20 equity split between CNGR and POSCO Future M.
These efforts aim to bolster the nickel-precursor-cathode material value chain in Pohang, enhancing the competitiveness of the domestic rechargeable battery industry.
POSCO Group is partnering with China’s CNGR to establish a robust production base for nickel and precursors for rechargeable batteries in Pohang.
▲ The Groundbreaking Ceremony for ‘POSCO CNGR Nickel Solution’ and ‘CNP New Material Technology’ on May 31.
On May 31, ‘POSCO CNGR Nickel Solution’ and CNP New Material Technology broke ground on nickel refining* and precursor** production plants, respectively, in the Yeongilman 4th Industrial Complex in Pohang.
*Refining: The process of removing impurities to increase purity.
**Precursor: An intermediate material before becoming cathode material, made by combining raw materials such as nickel and cobalt.
POSCO CNGR Nickel Solution, a nickel refining joint venture with a 60:40 equity split between POSCO Holdings and CNGR, and CNP New Material Technology, a precursor production joint venture with an 80:20 equity split between CNGR and POSCO Future M, aim to contribute to the rechargeable battery material supply chain significantly.
▲ Corporate Logos of POSCO CNGR Nickel Solution and CNP New Material Technology.
The nickel refining plant by POSCO CNGR Nickel Solution will process nickel matte with approximately 70% purity from CNGR’s nickel smelting subsidiary into 99.9% high-purity nickel for secondary batteries. The plant will have an annual production capacity of 50,000 tons of pure nickel, sufficient for about 1.2 million electric vehicles.
The precursor plant by CNP New Material Technology will produce 110,000 tons annually, using high-purity nickel from POSCO CNGR Nickel Solution. POSCO Future M plans to use these precursors to manufacture cathode materials, increasing the internalization rate of intermediate materials and enhancing the value chain for competitive business operations.
POSCO CNGR Nickel Solution and CNP New Material Technology will invest approximately KRW 1.5 trillion to complete the nickel and precursor plants, with mass production scheduled to begin in 2026.
Nickel, a critical material determining the capacity of secondary batteries for electric vehicles, is witnessing increasing demand. Precursors, determining the capacity and lifespan of secondary batteries and accounting for about 60% of the cost of cathode materials, have a high import dependency, with only 26% of domestic demand met by local production as of 2021.
Through collaboration with CNGR, which possesses top-tier nickel refining and precursor production technologies, POSCO Group aims to strengthen the rechargeable battery material value chain by producing nickel and precursors domestically for use in POSCO Future M’s cathode materials.
Pohang was designated a National High-Tech Strategic Industry Specialized Complex for secondary batteries in July last year. The expansion of POSCO Group’s investment in rechargeable battery materials is expected to revitalize local high-tech industries and contribute to regional economic development.
Over 300 people attended the groundbreaking ceremony for POSCO CNGR Nickel Solution and CNP New Material Technology, including Pohang Mayor Kang-deok Lee, Pohang City Council Chairman In-gyu Baek, North Gyeong Province Vice Governor Hak-hong Kim, POSCO Holdings Head of rechargeable Battery Materials Jun-hyung Kim, POSCO Future M President Byung-ok Yoo, and CNGR Vice Chairman Wu Xiaoge.
Pohang Mayor Kang-deok Lee stated, “I hope these two companies will make history in Pohang with this groundbreaking, and the city will provide full administrative support to be at the center of this history.”
Jun-hyung Kim, Head of rechargeable Battery Materials at POSCO Holdings, said, “POSCO Group and CNGR will establish a stable supply chain for rechargeable battery materials based on business know-how and technological prowess and will continue to enhance business synergies.”
Despite the chasm period of demand stagnation in the electric vehicle market, POSCO Group is committed to continuing investments in rechargeable battery materials, securing stable raw material supplies of nickel and lithium, and building a comprehensive value chain encompassing cathode and anode materials, recycling, and next-generation materials.