- POSCO will supply up to 25,000 tons of lithium concentrate annually to SK On through 2028.
- The agreement strengthens EV battery supply chains in North America and Europe while meeting sourcing regulations.
The POSCO SK On lithium concentrate supply agreement marks a significant step in securing raw materials for electric vehicle battery production. On February 24, POSCO Group formalized a deal with (SK) On to supply up to 25,000 tons of lithium concentrate annually from this year through 2028. This long-term arrangement is designed to reinforce supply chain resilience while supporting the rapid expansion of EV batteries manufacturing capacity in key global markets.
Scope of the POSCO SK On Lithium Concentrate Supply Agreement
Under the POSCO SK On lithium concentrate supply agreement, the annual supply volume is sufficient to produce batteries for approximately 400,000 electric vehicles. The lithium concentrate will be delivered to SK On’s battery plants located in North America and Europe, where demand for compliant battery materials continues to rise.
Production Capacity and EV Impact
The scale of lithium concentrate secured under this agreement directly supports the production of EV batteries at industrial volumes. By ensuring steady raw material availability, SK On can stabilize output across its battery plants and reduce exposure to volatile upstream markets.
Strategic Sourcing and Regulatory Compliance
A key driver behind the POSCO SK On lithium concentrate supply agreement is the need to comply with sourcing regulations that require battery materials to originate outside China. These regulations are increasingly shaping procurement strategies across the EV batteries ecosystem, particularly in North America and Europe.
Meeting Regional Sourcing Regulations
By sourcing lithium concentrate from Argentina, SK On strengthens its regulatory positioning while diversifying its supply base. This approach aligns with broader industry efforts to localize supply chains and reduce dependency on single-region material flows.
Hombre Muerto Salt Lake Operations in Argentina
The lithium concentrate under the POSCO SK On lithium concentrate supply agreement will be produced at the Hombre Muerto salt lake operated by (POSCO) Argentina. This asset plays a central role in POSCO Group’s upstream strategy and forms the foundation of its long-term lithium expansion roadmap.
Acquisition and Asset Integration
The Argentine salt lake became part of POSCO’s portfolio following an acquisition agreement with Lithium South Development Corporation for its NRG Metals Argentina S.A. subsidiary, announced in 2025. The integration of this asset strengthens POSCO Group’s ability to supply lithium concentrate at scale under the POSCO SK On lithium concentrate supply agreement.
4M Certification and Supply Timeline
POSCO Group plans to begin full-scale supply in the second half of 2026 after completing the 4M certification required by global battery manufacturers. The 4M certification process evaluates personnel, equipment, raw materials, and production processes to ensure consistent quality standards for EV batteries production.
Once certification is secured, the POSCO SK On lithium concentrate supply agreement will transition into its full operational phase, reinforcing long-term collaboration between the two companies and enhancing supply chain stability for electric vehicle battery manufacturing across North America and Europe.
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