POSCO Group Chairman Choi Jeong-woo, second from left, poses next to LG Energy Solution Vice Chairman Kwon Young-soo, third from left, after signing an MOU to enhance cooperation in the rechargeable battery business between POSCO Holdings and LGES at Parc 1 in Yeouido, Seoul, Friday. From left, LiB Materials Business head Lee Kyung-sub, Choi, Kwon and LGES Senior Vice President Kim Dong-soo. Courtesy of POSCO Holdings

By Kim Hyun-bin

POSCO Holdings and LG Energy Solution (LGES) will strengthen cooperation related to rechargeable batteries, according to the two companies, Monday.

The companies signed a memorandum of understanding (MOU) for "Strategic Business Cooperation in Secondary Battery Materials" in Seoul, Friday, in the presence of POSCO Group Chairman Choi Jeong-woo and LGES Vice Chairman Kwon Young-soo.

"We will be able to further enhance the competitiveness of the global battery industry through business cooperation between POSCO Group, which has strengths in the field of secondary battery materials, and LGES, a leader in the field of electric vehicle batteries," POSCO Group Chairman Choi said.

Global supply chain problems are emerging due to the United States-Mexico-Canada Agreement (USMCA) and the U.S. Inflation Reduction Act (IRA). The companies plan to strengthen their cooperative relationship to further enhance competitiveness.

The two companies decided to cooperate in detail throughout the entire value chain of secondary batteries, including medium- to long-term supply and purchase of positive and negative electrode materials, lithium, recycling and next-generation negative electrode materials.

LGES shared its plans to purchase positive and negative electrode materials for the next seven years, and POSCO Group shared its plans to supply secondary battery materials and accelerate expansion by region in accordance with the IRA, and both reconfirmed their commitment to the bilateral cooperation in establishing a stable supply chain.

After the signing of the agreement, the two companies plan to sign a medium- to long-term contract for the supply and sale of anode and cathode materials within this year and materialize business and technical cooperation through a working group in the recycling and next-generation anode materials sectors.

"As we have worked closely together, we will be able to maintain our competitiveness in various issues including the U.S. IRA through solid cooperation between POSCO Group and LGES," LGES Vice Chairman Kwon said.