2023-09-27 05:00:00
Expand domestic and overseas precursor production capacity by 210,000 tons by 2027
[인더스트리뉴스 이건오 기자] EcoPro Materials plans to become a global precursor manufacturing company by securing a production capacity of 210,000 tons by 2027 along with its KOSPI listing.
Eco Pro Materials (CEO Kim Byeong-hoon), Korea’s largest precursor producer, announced on the 25th that it submitted a securities report to the Financial Services Commission and began the public offering process for listing on the stock market. The total number of public offering shares is 14,476,000 shares, and the desired public offering price per share is 36,200 to 46,000 won. If the public offering is successfully completed, EcoPro Materials will be able to secure investment resources of 524 to 665.9 billion won.
Overview of Eco Pro Materials headquarters [사진=에코프로]
Strengthening the competitiveness of ‘K-Battery’ by improving precursor independence
EcoPro Materials is currently the only company in Korea that mass-produces precursors. The precursor is a raw material for the cathode material, and is made by mixing and refining minerals such as nickel, cobalt, manganese, and aluminum in a certain ratio. Precursors account for 20% of the cost of secondary batteries and 70% of the cost of cathode materials. Adding lithium to the precursor completes the cathode material. The precursor synthesis technology determines the price and quality of the cathode material and determines the characteristics of the battery, such as energy density, lifespan, and stability. Ultimately, securing the competitiveness of precursors is a key issue for secondary batteries, beyond battery anode materials.
This is also a persuasive background to the analysis that the listing of EcoPro Materials will drive the competitiveness of ‘K-Battery’ beyond EcoPro.
According to EcoPro Materials, the precursor process is largely divided into two types. These are CPM (Cathode Precursor Material) and RMP (Raw Material Precipitate). RMP is a process that extracts high-purity nickel and cobalt by adding sulfuric acid to low-purity raw materials. In the past, costs were high because high-purity raw materials were imported.
However, EcoPro Materials developed the RMP process and increased the added value of the precursor by importing and refining low-purity nickel mixtures at low cost. EcoPro Materials currently produces 50,000 tons of precursors per year at Pohang CPM Plants 1 and 2, and plans to quadruple its production capacity to 210,000 tons by 2027. We plan to begin construction of factories 3 and 4 in the second half of the year and expand into North America and Europe in the future.
Meanwhile, the listing of EcoPro Materials is expected to serve as an opportunity to increase precursor independence.
As of 2027, EcoPro Materials’ high-nickel precursor production capacity is expected to be 210,000 tons, following Chinese precursor companies such as GEM 410,000 tons, CNGR 403,000 tons, and Huayo Cobalt 250,000 tons, accounting for 7.5% of the total market. In markets excluding China, EcoPro Materials is expected to occupy 18.1% of the market.
Currently, most of the precursors produced by EcoPro Materials are supplied to its family company, EcoPro BM, and the plan is to expand external sales through customer diversification in the future.
The funds secured through listing will not only expand the production line, but also strengthen investments in next-generation precursor research and development to maintain technological leadership in precursors.
EcoPro Materials has demonstrated technological leadership by successfully developing Korea’s first high-nickel NCA precursor in 2006, the world’s first NCM811 precursor in 2018, and NCM9½½ precursor in 2020. Recently, we are preparing to meet various needs of the market such as reducing costs, increasing lifespan, and improving thermal stability by developing single crystal precursors, NMX cobalt-free precursors, and OLO precursors.
EcoPro Materials performance over the past 5 years [자료=에코프로]
Past ‘precursor’ business discontinued… EcoPro Materials pledges to revive through listing
Ecopro’s first relationship with secondary battery cathode materials began in 2004 when it jointly participated with Cheil Industries in the ‘Ultra High Capacity Lithium-ion Battery Development Consortium’ ordered by the government. The structure was such that Cheil Industries developed cathode materials and Ecopro developed precursors and supplied them to Samsung SDI, a cell company.
In 2006, when Cheil Industries liquidated its battery materials business as part of restructuring, EcoPro took over it. Ecopro began to generate synergies by conducting both anode material and precursor businesses simultaneously, and began to significantly expand its precursor business in 2009. As the supply of precursors to a large domestic company increased, the line was expanded significantly through bank loans.
However, as Japanese competitors launched a low-price offensive to drive EcoPro out of the market, EcoPro eventually discontinued its precursor business and instead focused on strengthening its anode material technology. As a result, following the test supply of cathode materials to Sony in 2013, the company also supplied NCA cathode materials for power tool battery cells to Samsung SDI, turning the crisis of the discontinuation of the precursor business into an opportunity.
Since then, EcoPro has produced the precursors used in EcoPro BM in small quantities and imported most of them from China’s GEM. Then, recognizing the importance of the precursor business, it acquired the Chinese stake in the Chinese joint venture EcoProGEM and began its own technology development and line construction in 2017, preparing for listing.
Kim Byeong-hoon, CEO of Eco Pro Materials, said, “Eco Pro Materials is driving high growth by establishing its own value chain from purchasing raw materials, producing precursors, and reaching end customers.” He added, “As Korea’s only non-China precursor company, we are proud to have the U.S. IRA. , we expect to benefit more from changes in the regulatory environment, such as Europe’s CRMA. “We will be reborn as a global precursor company through continuous diversification of our customers.”
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