LFP cathode market expands as POSCO Future M targets cost reduction

The global market for Lithium Iron Phosphate (LFP) cathode materials is experiencing rapid growth, with LFP expected to account for 77% of the total cathode market this year. According to SNE Research, LFP shipments are projected to reach 5.24 million tons in 2024, driven by increasing demand in electric vehicles (EVs) and energy storage systems (ESS), as well as emerging applications in AI data centers and marine mobility.

In response to the market shift, POSCO Future M has unveiled a long-term strategy to compete with Chinese manufacturers by reducing reliance on Chinese precursors. The company plans to implement a “precursor-free” manufacturing method, which skips the intermediate iron phosphate (FP) stage by directly utilizing lithium and iron oxide. This process aims to lower production costs and energy consumption. POSCO Future M intends to begin mass production of LFP in Pohang by the fourth quarter of this year, with a goal of reaching a production capacity of 55,000 tons by 2028.

While Chinese companies currently dominate the market, the industry is shifting toward high-density, fast-charging, and low-temperature performance. South Korean companies, including POSCO Future M, LG Chem, and L&F, are accelerating pilot and mass production efforts to secure a foothold in the ESS and EV sectors.