Samsung SDI said on the 24th that it signed a mid- to long-term supply contract with L&F, a leading domestic battery materials specialist, for cathode materials for LFP (lithium iron phosphate) batteries.
Through this contract, Samsung SDI will procure from L&F about 1.6 trillion won worth of cathode materials needed to produce LFP batteries for ESS over three years starting next year. It also added an option to receive additional supplies for another three years afterward.
Samsung SDI plans to use the LFP cathode materials secured from L&F to produce ESS batteries at StarPlus Energy (SPE), its joint venture with Stellantis in Indiana.
SPE has been gradually converting some production lines from electric-vehicle use to ESS use since the fourth quarter of last year. Starting in the fourth quarter of this year, it plans to mass-produce LFP batteries in addition to its existing high-nickel NCA (nickel, cobalt, aluminum) batteries.
A Samsung SDI official said, "We expect to firmly cement our competitive edge in the North American ESS market while building a stable domestic materials supply chain through this contract with L&F."
L&F made a new investment in LFP cathode materials in Aug. last year and is building production facilities with an annual capacity of 60,000 tons.
Samsung SDI has recently been winning orders for ESS batteries in the North American market. At the end of last year, it signed a 2 trillion won supply contract for LFP batteries for ESS with a major U.S. energy-related developer and operator, and on the 16th it also signed a 1.5 trillion won supply contract for ESS batteries with a U.S. energy specialist.
A company representative said, "We proactively entered into a supply contract with a domestic company in line with demand to de-China the materials market," adding, "Through this contract, we will further strengthen our competitiveness in the North American market and create more business opportunities."