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LG to invest USD5.2 bln in production of chemicals and materials for electric vehicle batteries

July 15/2021

MOSCOW (MRC) -- South Koreas LG plans to invest USD5.2bn to start producing the chemicals and materials used in electric vehicle batteries, as the global industry leader urgently tries to cut its dependence on China, reported Financial Times

The four-year investment by the worlds biggest EV battery maker comes as plans by countries and carmakers to pivot away from fossil fuel-powered vehicles are complicated by the industrys heavy reliance on refineries and factories in China. The country is by far the planets largest processor of most of the minerals needed for battery production.

LG Chem, the parent of the conglomerates battery group LG Energy Solution, said on Wednesday it would diversify its production of important materials including those used in cathodes, anodes and separators.

We will reinvent our company as the worlds largest battery material producer, said Shin Hak-cheol, LG Chems chief executive.

South Korea is home to several of the worlds leading EV battery makers such as LG Energy Solution, as well as units of conglomerates SK and Samsung. LG Energy has battery production plants in China, Poland and the US, and in Korea. In March, the group announced a plan to invest USD4.5bn by 2025 to expand its battery production in the US. The company supplies automakers including Tesla, General Motors and Volkswagen.

The battery materials market is forecast to more than double to about Won100tn (USD87bn) by 2026 from Won39tn, LG said.

Analysts expect LGs move to help reduce global dependence on China for the processing of battery materials. Korean companies have been wary of relying too much on one source since Japan imposed export controls on semiconductor components in 2019. Beijing in 2010 cut off exports of rare earth elements to Japan.

As MRC informed earlier, in 2018, LG Chem announced plans to spend USD2.4-billion to expand its naphtha cracking center (NCC) and polyolefin (PO) plant in Yeosu, South Korea. The new cracker will supply feedstock to new PO plants with the capacity of 800,000 t/y each.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 953,400 tonnes in the first five months of 2021, which virtually corresponded to the same figure a year earlier. High denisty polyethylene (HDPE) shipments decreased. At the same time, PP shipments to the Russian market were 607,8900 tonnes in January-May 2021, up by 33% year on year. Shipments of homopolymer PP and PP block copolymers increased, whereas deliveries of PP random copolymers decreased.

LG Chem Ltd., often referred to as LG Chemical, is the largest Korean chemical company and is headquartered in Seoul, South Korea. It has eight domestic factories and global network of 29 business locations in 15 countries. LG Chem is a manufacturer, supplier, and exporter of petrochemical goods, IT&E Materials and Energy Solutions.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, propylene, ethylene, car components, batteries, petrochemistry, LG Chem, Volkswagen, South Korea.
Category:General News
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