POSCO Future M plans to supply large volumes of LFP cathode material to an unnamed South Korean battery manufacturer starting in 2027. The agreement covers more than 190,000 metric tons over six years through 2032. The final contract terms are expected to be determined in the third quarter.
The agreement marks the company’s entry into the market for cathode materials used in lithium iron phosphate (LFP) batteries. According to POSCO Future M, the move is primarily driven by growing demand for stationary energy storage systems (ESS) in North America.
LFP Production in Pohang Set to Begin in 2026
To enable production in the near term, POSCO Future M has converted parts of existing production lines at its Pohang plant. These lines previously produced high-nickel cathode materials. The converted facilities will instead manufacture LFP cathode material.
According to the company, customer certification of prototypes is currently underway. Commercial-scale deliveries are scheduled to begin by the end of 2026.
LFP batteries have lower power output than NCM and NCA cells. However, they are less expensive and designed for a longer service life. POSCO Future M sees potential applications particularly in stationary energy storage and lower-cost electric vehicles.
For production, the company plans to use iron oxide derived from steelmaking byproducts, among other materials. Lithium is also expected to come from salt lakes in Argentina.
Additional LFP Capacity Planned from 2027
Additional production capacity is also being developed in Pohang. CNP New Material Technology, a joint venture between POSCO Future M and FINO-CNGR, began construction of an LFP cathode material plant in May.
Commercial production at the facility is scheduled to start in 2027. Capacity is expected to be expanded in stages to a maximum of 50,000 metric tons.
