LG Energy Solution Secures High-Nickel Core Materials in Morocco with Chinese Company

Morocco Signs FTA with US and EU
Responding to Battery Supply Chains like IRA

LG Energy Solution is securing key materials for high-nickel batteries in Morocco, Africa, to strengthen its battery supply chain.

On the 5th, LG Energy Solution announced that it signed a memorandum of understanding (MOU) with Yahua, a leading Chinese lithium compound manufacturer, for the production of lithium hydroxide in Morocco.

Lithium hydroxide is used as a raw material for high-performance "high-nickel batteries" because it easily synthesizes with nickel, a key raw material for cathode materials. As the nickel content in batteries increases, energy density rises, extending the driving range per charge. Accordingly, the battery industry is focusing on establishing a stable supply chain for lithium hydroxide.

Yahua is a leading Chinese lithium hydroxide manufacturer whose product quality has been verified by major global battery companies. LG Energy Solution expects to secure high-quality lithium hydroxide through synergy with Yahua’s excellent manufacturing quality and technology.

In particular, Morocco has free trade agreements (FTAs) with the United States and Europe (EU), making it more adaptable to the rapidly changing external business environment due to the implementation of the U.S. Inflation Reduction Act (IRA) and the EU Critical Raw Materials Act (CRMA).

LG Energy Solution has established a stable raw material supply chain by signing a 5-year contract to supply 45,000 tons of lithium hydroxide with German lithium producer Vulcan Energy in Europe, securing 700,000 tons of lithium concentrate raw material from Australia’s Liontown for 5 years, and signing a 9-year contract to supply 55,000 tons of lithium hydroxide and lithium carbonate with SQM, Chile’s leading lithium company and the world’s largest lithium holder.

Kim Dong-su, Head of Purchasing Center at LG Energy Solution, said, "We have been able to further strengthen the raw material supply chain in the high-growth North American and EU markets. We will enhance customer value by securing differentiated raw material supply stability and quality competitiveness."

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