In the midst of the expected inauguration of Donald Trump as the president of the United States and the impeachment proceedings against the president and acting president, the South Korean economy is in a situation where it is difficult to foresee even a moment ahead. Amid the chaotic situation both inside and outside the country, South Korean corporations armed with the world's top technological capabilities are challenging the global summit. This article examines the companies that illuminate Korea in the world. [Editor’s note]
On Dec. 24 last year, at the zinc casting plant of the Korea Zinc Onsan Smelter in Ulsan's Uljin County, hundreds of zinc ingots emerged from molds heated to about 500 degrees Celsius, stacked in one corner of the factory filled with the sounds of metal clashing and heat. The sizes and shapes varied, from jumbo zinc ingots weighing over 1 ton to small bricks resembling overlapping die-cast zinc ingots. It takes about 1 to 2 hours for the zinc ingots to cool completely, and steam was still rising from some surfaces.
Korea Zinc produces about 1.2 million tons of non-ferrous metals, including zinc, lead, silver, and copper, at the world's largest scale every year. Most of this is used as basic materials for key industries such as electronics, semiconductors, automobiles, and steel. The highest production share is zinc (650,000 tons). Zinc protects its interior by forming a thin film on the surface when exposed to moisture, making it primarily used as a coating agent to prevent corrosion of steel materials like automotive steel plates, steel pipes, and iron structures. It is also used to make toy figures, faucets, zippers, buckles, and communication equipment.
The background behind Korea Zinc leading non-ferrous metal production worldwide lies in its differentiated smelting technology. While non-ferrous metal smelting is considered a universal technology that anyone can perform, Korea Zinc is evaluated as unrivaled in maintaining both high quality and economy.
Korea Zinc extracts not only zinc and lead from raw materials like zinc concentrate (metal ore from which impurities have been primarily removed) but also precious metals like gold and silver along with sulfuric acid. Unlike most smelters that only handle single-purpose metals like zinc and lead, Korea Zinc operates an integrated process for zinc, lead, and copper. It has its own technology for recovering additional zinc and precious metals from byproducts of zinc smelting and discharging clean slag used as raw materials for cement or asphalt.
On average, the zinc content in zinc concentrate is 50.6%, with the remainder consisting of sulfuric acid 30%, other rare and precious metals 16.4%, lead 3%, and silver 0.006%. The same applies to lead concentrate, where more than half, 56%, is lead, but 28.7% consists of other rare and precious metals, with sulfuric acid (15%), silver (0.311%), copper (0.035%), and gold (0.0003%) making up the rest. The gold obtained from byproducts during the concentrate smelting process at Korea Zinc is about 10 tons annually, with 2,500 tons of silver and 1.5 million tons of sulfuric acid, with the market value of 10 tons of gold reaching approximately 140 billion won.
Kim Seung-hyun, head of the Korea Zinc Onsan Smelter, noted, “Other smelting companies either discard or sell the remaining byproducts cheaply after extracting the target metal, but recovering even small amounts of rare and precious metals from impurities is the key to Korea Zinc's revenue.” He added, “It has become a subject of research as a model case in the global smelting industry, but dealing with impurities requires extensive experience and know-how, making it difficult to catch up quickly.”
Recently, there are increasing concerns about the outlook for the smelting industry due to surging demand from China and cost burdens. However, according to Kim, there is potential to defend profitability by increasing the recovery rates of precious metals and rare metals. Korea Zinc plans to raise the recovery rates of antimony, indium, tellurium, and palladium by over 20% to 30% for each item. Antimony and bismuth are strategic mineral resources used in fourth-generation small reactors, nuclear submarines, flame retardants, and catalyst raw materials.
Smelting companies receive treatment charges (TC) from mining companies in exchange for smelting concentrates. The recovery rate is the ratio of the metals extracted from the same amount of concentrate, and while it varies by type, contracts with mining companies generally allow for around 90%. If more metals than the promised rate are extracted, it belongs to the smelting company. This is referred to as free metal in the industry. Korea Zinc has raised its metal recovery rate to nearly 100%.
Korea Zinc plans to leverage its non-ferrous metal smelting technology to establish a presence in the nickel business, which is the main raw material for battery precursors (substances that participate in chemical reactions). The 'all-in-one nickel smelter' currently under construction, aiming for commercial production in 2026, is expected to be a pivotal facility that can handle diverse raw materials at once, including nickel concentrate, matte (containing 70% to 75% nickel), and mixed hydroxide precipitate (MHP) extracted from waste batteries. MHP is the raw material for battery precursors.
Korea Zinc possesses both dry (which causes chemical reactions at high temperatures) and wet (which electrolyzes ore dissolved in sulfuric acid) smelting technologies, which is expected to assist in the flexible utilization of nickel raw materials. Nickel intermediates processed by the dry smelting method from ore mined from nickel mines become matte, while those processed through the wet smelting method become MHP.
At the construction site of the all-in-one nickel smelter, located just five minutes by car from the Onsan Smelter, dump trucks and cranes were bustling about. With about 500 billion won invested by Korea Zinc and its subsidiary Kemco, the all-in-one nickel smelter is projected to produce 43,600 tons of nickel annually starting from late 2026. Combined with the existing production by Kemco, the total will be 65,000 tons, which is enough for 1.6 million electric vehicles.
Once Korea Zinc begins supplying domestically produced nickel to the precursor factory, the dependence of the domestic battery supply chain on China is expected to decrease somewhat. Precursors are among the key items with a high dependence on China. Although they account for 70% of the price of cathode materials, over 90% of these are imported from China. Korea Zinc has established its own precursor production plant in partnership with LG Chem, and its high-nickel precursor manufacturing technology has also been recognized as a national core technology.