POSCO Chemical Forms Symbiotic Fund with Huayou Cobalt

[Asia Economy Reporter Hwang Yoon-joo] POSCO Chemical is forming a symbiotic fund with China’s Huayou Cobalt to jointly promote regional community development and strengthen their cooperative relationship.

POSCO Chemical and Huayou Cobalt announced on the 19th that they signed a business agreement to establish the "POSCO Chemical - Huayou Cobalt Symbiotic Fund." Due to the COVID-19 pandemic, the agreement was conducted remotely connecting POSCO Chemical CEO Min Kyung-jun and Huayou Cobalt CEO Chen Xuehua.

This symbiotic fund agreement is based on the companies’ collaboration in business areas such as supplying cobalt and precursors, which are raw materials for battery cathodes, aiming to expand cooperation across the entire business process including securing sustainability through contributions to local communities and strengthening their partnership.

POSCO Chemical receives precursors, the raw materials for cathodes, from Huayou Cobalt, the world’s largest cobalt producer. Additionally, at the POSCO Group level, they established a cathode material production joint venture, Zhejiang Huahua, in China in 2018, and the two companies have continued various business collaborations in battery materials and raw materials.

Huayou Cobalt is the world’s number one global producer of cobalt, a raw material for lithium-ion batteries, and also owns its own cobalt mines. Cobalt is one of the rare metals, with difficult production and mining processes and high price volatility, making strengthened cooperation with Huayou Cobalt significant for the stable supply of key battery material raw materials.

According to the symbiotic fund agreement, POSCO Chemical and Huayou Cobalt will each contribute USD 20,000 annually in a 1:1 matching grant format, creating a fund of USD 40,000. The established fund will be alternately supported in each country every year and used for support projects aimed at regional community development and talent cultivation.

As their first project, this year they decided to support the installation of wells in an island village near the cathode material Gwangyang plant through the international relief organization World Vision. Songdo, located in Gwangyang Bay, Jeollanam-do, is a small island with about 70 households, which has faced difficulties in supplying drinking and domestic water due to insufficient water supply facilities. Next year, Huayou Cobalt plans to promote a scholarship program linked to jobs for local residents in China.

Meanwhile, the POSCO Group is expanding symbiotic funds with overseas raw material suppliers to strengthen cooperation with stakeholders within the value chain and globally spread its corporate citizenship management philosophy. POSCO currently operates symbiotic fund programs with coal suppliers such as Australia’s Yancoal and the United States’ Xcoal.

This content was produced with the assistance of AI translation services.