POSCO Future M, South Korea’s leading anode material producer, has secured a critical agreement with Australia’s Syrah Resources Ltd. for a steady supply of up to 60,000 tons of natural graphite annually from Mozambique’s Balama Graphite Operations. This six-year deal is a strategic move to lessen reliance on Chinese graphite imports, fitting into a broader strategy to diversify supply sources amid changing geopolitical and regulatory landscapes.
This partnership is designed to bolster POSCO Future M’s supply chain resilience, especially considering U.S.-China tensions. It aligns with the U.S. Inflation Reduction Act’s requirements, which mandate sourcing critical minerals from North America or its trading partners for certain tax incentives. This alignment could protect the company from supply disruptions and boost its standing in the global electric vehicle (EV) battery market.
The deal sets up an initial import capacity with potential for expansion, ensuring a reliable supply for producing natural graphite anode materials. This strategic sourcing acts as a safeguard, particularly given China’s dominance in the graphite market and recent restrictions on graphite exports.
This new supply chain strategy is expected to significantly enhance POSCO Future M’s production capabilities, supporting its expansion into self-produced spherical graphite, essential for lithium-ion batteries. This initiative reflects the company’s proactive approach to establishing a diversified and secure raw material base, strategically positioning itself to capitalize on the burgeoning demand for EV components.
