South Korea is projected to set a new record in rechargeable battery exports this year.

Overseas shipment of rechargeable batteries is expected to grow 5.7 percent from a year earlier to reach a record high of $7 billion, according to a projection by the Ministry of Trade, Industry and Energy and the Korea Battery Industry Association on Monday.

In 2020, the country’s battery exports increased 2.9 percent year-on-year to $6.57 billion, marking a fifth consecutive year of growth.

By segment, batteries for electric vehicles propelled the gains, logging a 10.6 percent growth to $1.15 billion from $1.04 billion a year earlier.

“In the January-November period last year, 2.5 million EVs have been rolled out across the globe compared to 2.3 million units from a year prior. The expansion of global EV market triggered the increase of battery exports,” an industry ministry official said.

As of November last year, major Korean battery makers -- LG Energy Solution, Samsung SDI and SK Innovation -- together controlled 34 percent of the global EV battery market, almost double the 16 percent share they held in 2019, according to market tracker SNE Research.

To respond to the growing demand for EV batteries in major markets including the US, Europe and China, Korean firms have made aggressive moves in expanding their production base overseas.

Last year, the global production of rechargeable batteries by Korean battery firms was worth 23.3 trillion won ($23.3 billion), up 20 percent from the previous year. However, their domestic production increased just 3.3 percent to 10.6 trillion won in the same period.

“This year, Korean battery companies’ global production of rechargeable batteries is expected to spike 32 percent on-year to 31 trillion won,” the ministry official said.

Domestic demand for rechargeable batteries increased to 5.27 trillion won, an 11.6 percent rise on-year, as the number of EVs increased 33.8 percent to 139,000 units from 100,300 units in the same period.

“As new EVs are set for release in Korea, including Hyundai Motor’s E-GMP models, the domestic demand for rechargeable batteries is likely to jump 19.8 percent to 6.3 trillion won this year,” the official said.

By Kim Byung-wook (kbw@heraldcorp.com)