POSCO Holdings "6 Trillion Won Investment in Lithium by 2030... Expecting Recovery in Chinese Steel Demand in H2" (Comprehensive)

"Argentina Lithium Nationalization Not Easy"
POSCO Inter-Energy Merger "Under Internal Review"

[Asia Economy Reporter Oh Hyung-gil] POSCO Holdings plans to invest 6 trillion KRW in lithium related to secondary battery materials by 2030.

Lee Kyung-seop, head of POSCO Holdings' Secondary Battery Materials Promotion Team, stated at a corporate briefing held on the 21st, "We plan to invest 6 trillion KRW in the lithium sector by 2030, with an annual investment scale of up to 1.5 trillion KRW."

Lee explained, "The lithium investment method involves establishing a corporation for investment. POSCO Holdings will pay the capital and borrow about 30-60% of external funds. Currently, the Argentina project is being promoted with 30% external borrowing, and POSCO Pilbara Lithium Solutions in Gwangyang has about 58% external borrowing."

He added that although countries like Bolivia and Chile are nationalizing lithium businesses, similar events are not expected to occur in Argentina.

He said, "Legally, mining rights in Argentina are approved by local governments rather than the central government. From the early stages of lithium development, active investment attraction from global companies has been underway, and major overseas companies are all involved. It would be difficult to nationalize or impose unfair economic sanctions."

Jeon Jung-sun, president and head of POSCO Holdings' Management Strategy Team, said, "I think we need to speed up the lithium business," adding, "To invest in lithium, we need to secure ore and chlorine. We will invest in Argentina as soon as possible to start production early and simultaneously work on securing ore."

Regarding the recently continuing weak Chinese steel market, he cited the possibility of production adjustments by Chinese steel companies and expectations for additional stimulus measures in China as positive factors for the second half of the year.

Um Ki-chun, head of POSCO Marketing Strategy Office, said, "Supply chain issues affecting the normal operation of steel demand industries such as automobiles have somewhat eased recently but will continue into the second half of the year," adding, "In China, with the Party Congress deciding President Xi Jinping's third term, the government’s strong willingness to stimulate the economy means that if additional stimulus policies are introduced, steel demand will recover."

Regarding the merger of POSCO Inter and POSCO Energy, he said it is at the "internal review stage."

President Jeon said, "When launching the holding company, we aimed to strengthen the group's business portfolio. Improving efficiency or changing synergy structures in existing businesses is also part of portfolio strengthening. We are internally reviewing the merger, and if a decision is made by the board of directors, we will officially explain it."

Meanwhile, POSCO Holdings announced that its consolidated sales for the first half of the year reached 23 trillion KRW, a 25.7% increase compared to the same period last year. Operating profit was 2.1 trillion KRW, and net profit was 1.8 trillion KRW.

Despite the global economic recession caused by soaring raw material prices and inflation realization, profits increased in the steel sector, and the eco-friendly infrastructure and future materials sectors performed well, continuing operating profits in the 2 trillion KRW range for the second consecutive quarter.

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