Korea Zinc and LG CHEM jointly established Korea Zinc's subsidiary, Korea Precursors Co., Ltd. (KPC), which is a core affiliate of its secondary battery material business, and it has entered the mass production system for precursors, which are key raw materials for secondary battery cathodes.
On the 21st, Korea Zinc noted that it completed the Korea Precursors factory with an annual capacity of 20,000 tons last March, and after producing prototypes and supplying them to clients, it has finished quality verification and has officially entered the mass production phase.
Korea Precursors is a joint venture established in August 2022, through an investment of about 200 billion won by Korea Zinc and LG CHEM via its subsidiary Chemco. It plans to gradually increase production capacity with the first mass production in the first half of this year, aiming to operate at maximum production capacity from the second half.
Domestic secondary battery corporations have heavily relied on China for precursors and cathode materials. According to the Korea International Trade Association, the dependency on Chinese imports for domestic precursors reached 97% as of the first half of last year. Korea Zinc reports that the entry of Korea Precursors into the mass production system makes it possible to overcome this situation.
Precursors are a type of compound mixed with nickel, cobalt, manganese, etc., serving as the initial stage for the key secondary battery material, cathodes. Adding lithium to the precursors converts them into cathodes. Precursors account for about 60% of the manufacturing cost of cathodes, while cathodes represent approximately 40% of the battery's manufacturing cost.
Korea Precursors is focusing on the production of 'high-nickel precursors,' which receive the most requests from clients. 'High-nickel precursors' can increase the nickel proportion in precursors to over 80%, enhancing energy density and output. In particular, Korea Zinc's 'lithium secondary battery nickel (Ni) content over 80% cathode active material precursor manufacturing and processing technology' was designated as a national core technology and national advanced strategic technology by the Ministry of Trade, Industry and Energy last November.
Heo Gyun, CEO of Korea Precursors, stated, "Precursors are not finished goods but intermediates, so it is essential to satisfy the standards of clients producing finished goods," adding, "In the medium to long term, to stay ahead in competition with Chinese precursors, we will continually invest in facilities and further enhance precursor technology."