This photo shows LG Chem Ltd’s cathode plant in Cheongju, North Chungcheong Province, 112 kilometers south of Seoul, on June 26, 2023, as provided by the company.
SEOUL, Aug. 7 (Korea Bizwire) — South Korea’s export of cathodes, a key secondary battery material, to the United States surged almost threefold in the first seven months from a year earlier, on growing demand for electric vehicle (EV) cells and the new U.S. law on promoting green technologies, data showed Monday.
Outbound shipments of cathode materials to the U.S. amounted to US$1.83 billion in the January-July period, up 177.8 percent from $661 million the previous year, according to the data by the Korea International Trade Association (KITA).
Cathodes are one of the four components used in lithium-ion batteries, along with anodes, separators and electrolytes. Cathodes determine the power of EV batteries and account for about 40 percent of battery production costs.
The cathode exports to the U.S. had only reached about $9 million in early 2021, before jumping by more than sixfold to $57 million in just one year, KITA data showed.
The value of monthly shipments surpassed $100 million in May last year and topped the $200 million mark in January of this year. It hit a record high of $326 million in March.
The rapid growth in cathode exports is attributable to the enactment of the Inflation Reduction Act (IRA) in August last year that gives up to $7,500 in tax credits for purchasing EVs assembled in North America.
The IRA requires a certain portion of EV batteries be made with minerals mined or processed in the U.S. or countries or regions with which the U.S. has a free trade agreement.
Cathode and anode active materials, which come in a powder form, are classified as “constituent materials,” like minerals, under the IRA, rather than “components,” allowing Korean companies to produce them at their domestic facilities and ship them to the U.S. for manufacturing battery parts in North America.
This photo, provided by POSCO Future M Co. shows its cathode plant in Gwangyang, South Jeolla Province, 423 kilometers southwest of Seoul.
South Korean battery makers have been aggressive in forming partnerships with EV makers to meet IRA requirements.
LG Energy Solution Ltd. has battery manufacturing facilities operating or under construction in Ohio, Tennessee and Michigan in a venture with General Motors Co.
SK On Co. has two factories running in Georgia and is building three others in Kentucky and Tennessee with Ford Motor Co.
Samsung SDI Co. is building two battery plants in the U.S. with Stellantis N.V.
(Yonhap)
