POSCO International broke ground on a graphite mine in southeastern Tanzania this week, taking another step in South Korea’s effort to reduce reliance on Chinese battery materials that dominate global supply chains.
The ceremony Thursday for the Mahenge mine comes as China controls more than 70% of global graphite supply and battery producers worldwide scramble for alternatives. The US recently imposed a 93.5% anti-dumping tariff on Chinese graphite imports, potentially raising total duties to around 160% when combined with existing levies.
POSCO’s Mahenge project, operated by Australia’s Black Rock Mining, holds an estimated 6 million tons of natural graphite reserves, making it the world’s second-largest deposit. The South Korean trading company paid $40 million (₩56.8 billion) in September for a 19.9% stake in the venture.
Commercial production isn’t expected until 2028, a timeline that reflects the long lead times for developing mining infrastructure in Africa. Once operational, POSCO plans to secure 60,000 tons of graphite annually for 25 years, processing the material at its Future M facilities in Korea for use in battery anodes.
The investment marks POSCO’s latest move to diversify raw material sourcing for its battery business, which also includes projects in Mozambique and Madagascar. China processes about 95% of battery-grade graphite globally, according to industry data, giving Beijing significant leverage over electric vehicle supply chains.
Tanzania’s government holds a 16% free-carried interest in the project, part of broader efforts across African nations to capture more value from mineral exports. The development is also backed by the Minerals Security Partnership, a US-led initiative aimed at building supply chains outside Chinese control.
Whether POSCO can profitably compete with Chinese producers, who benefit from decades of experience and integrated supply chains, remains to be seen. The company’s success will depend partly on sustained policy support from governments seeking to reduce dependence on Chinese materials.
