A subsidiary of South Korea’s POSCO Group, POSCO Future M will double its production capacity of artificial graphite anodes to over 36,000 tons by 2025 in response to the U.S. Inflation Reduction Act (IRA), which excludes Chinese companies.

By the end of 2025, POSCO Future M plans to invest 400 billion won ($300 million) to increase its artificial graphite anode production scale and more than double its current capacity, according to a statement released on Wednesday by the Ministry of Trade, Industry, and Energy. At present, the company produces about 8,000 tons of artificial graphite anodes; by the end of 2024, it hopes to reach 18,000 tons, and by the next year, 36,000 tons.

The longevity and charging efficiency of batteries are largely dependent on their anodes. POSCO Future M is the only company in Korea manufacturing graphite anodes with a graphite-based composition, and it is noteworthy that the entire production process, from raw materials to the finished product, can be fully localized. At a time when China was announcing steps to restrict its exports of graphite, the company came to light in 2023 when it proved that it could produce 100% synthetic graphite in Korea.

Pitch coke is used to create needle coke, which is a byproduct of the steelmaking process, in POSCO Future M’s artificial graphite anodes. Through POSCO MC Materials, a subsidiary, POSCO Group directly produces needle coke.

As a vital product to address supply chain strengthening laws like the EU Critical Raw Materials Act (CRMA) and the U.S. IRA, POSCO Future M’s artificial graphite anodes are gaining notice.

The use of key minerals produced by Foreign Entities of Concern (FEOCs) will no longer be eligible for EV subsidies in the United States as of 2025, according to the IRA’s FEOC provision. Chinese businesses dominate the anode material market, and the U.S. administration is classifying nearly all Chinese businesses as FEOCs.

The IRA classifies graphite anodes as a core mineral, so POSCO Future M might gain from the exclusion of Chinese producers of graphite anodes. POSCO Group has stated plans to set up an annual production system of 218,000 tons of anodes by 2026, propelled by the growth of the electric vehicle market and the IRA policy. A natural graphite anode with a capacity of 154,000 tons is included in this, along with artificial and silicon graphite anodes with capacities of 58,000 and 6,000 tons, respectively.

Topics #Artificial Graphite Anodes #Electric Vehicle Market #EV Subsidies #POSCO Future M #Supply Chain Strengthening #U.S. Inflation Reduction Act