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Photo: Samsung SDI |
[Alpha Biz= Kim Jisun] Samsung SDI has signed a multi-year agreement with South Korean battery materials producer L&F to secure lithium iron phosphate (LFP) cathodes, as part of efforts to reduce reliance on China and expand its presence in the North American energy storage system (ESS) market.
The company said on March 24 that it will receive LFP cathode materials from L&F for three years starting next year, with an option to extend supply for an additional three years.
Samsung SDI plans to use the materials to produce ESS batteries at StarPlus Energy (SPE), its joint venture with Stellantis located in Indiana, the United States.
SPE has been gradually converting some of its production lines from electric vehicle (EV) batteries to ESS batteries since the fourth quarter of last year. Beginning in the fourth quarter of this year, the facility is expected to mass-produce LFP batteries alongside its existing high-nickel NCA (nickel-cobalt-aluminum) batteries.
The agreement is expected to help Samsung SDI establish a stable domestic supply chain for key battery materials and enhance its competitiveness in the North American ESS market.
The global battery industry currently relies heavily on Chinese suppliers for LFP cathodes. However, tightening regulations in the United States—including rules related to “prohibited foreign entities (PFE)”—have made supply chain diversification a growing priority.
L&F has moved to address this shift by initiating new investments in LFP cathode production in August last year, becoming one of the first non-Chinese companies to do so. The company is currently building production capacity of up to 60,000 tons per year.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
