Chinese and South Korean businesses have formed two new joint ventures to produce lithium-ion battery materials from bases in China.
The move follows months of claims and counter claims over China’s alleged “blocking” of South Korean batteries in a heated trade spat.
However, in a sign that tensions may have eased, South Korean steelmaker Posco and Chinese mining company Zhejiang Huayou Cobalt have signed a partnership deal to invest a total of CNY1.9 billion ($302 million) in the new ventures, according to Huayou.
And Huayou acknowledged that the deal could become a “model for successful cooperation” between Chinese and Korean enterprises.
The two new companies— to be known as Zhejiang Huayou-Posco New Energy and Zhejiang Posco-Huayou New Energy— will research, produce and sell precursors and cathodes materials for lithium-ion batteries. Huayou will hold a majority 60% stake in the first company to Posco’s 40%— and vice versa in the second enterprise.
Under the terms of the partnership, Posco will supply its lithium nickel manganese cobalt oxide (NCM) technology to the joint ventures.
In February 2017, Posco opened a lithium extraction plant in Gwangyang, South Korea, to supply lithium phosphate to the country’s battery manufacturing giants LG Chem, Samsung SDI, and Posco’s own battery-related joint venture Posco EMS.
Posco EMS, which develops active materials for the secondary battery market, is a joint venture with South Korean steelmaker Phoenix Materials.
According to Posco, it has developed and started mass production of high-capacity cathode material with 80% or more nickel, gradient-NCM, for low-speed electric vehicles.