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POSCO sets up joint ventures to enter Chinese lithium ion battery market

2018/01/24 15:49

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SEOUL, Jan. 24 (Yonhap) -- POSCO, the world's fifth-biggest steelmaker by output, said Wednesday that it has partnered with Zhejiang Huayou Cobalt Co. to enter the Chinese lithium ion battery market.

POSCO said it set up two separate joint ventures with the Chinese cobalt company on Jan. 10 to produce precursors and cathodes in China's eastern province of Zhejiang from the second half of 2020.

The two joint ventures will have an annual production capacity of 4,600 tons of precursors and cathodes, respectively, it said.

A precursor is a compound that participates in a chemical reaction that produces another compound. A cathode, a key material to make a lithium ion battery, is a positive electrode on a battery and a negative electrode on an electrolytic cell.

Zhejiang Huayou Cobalt is the supplier of about 50 percent of the global demand for cobalt, a core material needed to produce lithium ion batteries. It also has its own cobalt and nickel mines, according to POSCO.

As each government goes environmentally friendly, the demand for car batteries, energy storage systems for buildings and large-sized batteries for information technology companies is on the rise, it said.

The world's cathode market is expected to grow more than four times to 860,000 tons in 2020 from 210,000 tons in 2016, POSCO said.

kyongae.choi@yna.co.kr

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