Posco International said Monday it has signed a contract with Faru Graphite Corporation, a Tanzanian subsidiary of Australian mining company Black Rock Mining, to be supplied with natural graphite, a key material for rechargeable batteries.
This comes as part of the trading and energy company’s full-fledged efforts to secure a global value chain for battery materials for electric vehicles.
Under the contract, Posco International will invest $10 million to receive a supply of 750,000 tons of natural graphite over 25 years.
Faru Graphite is a joint venture set up between the Tanzanian government and Black Rock Mining to run the Mahenge Graphite Mine, which is home to the world’s second-largest natural graphite reserves. It is set to operate and deliver graphite concentrate for 26 years, according to Black Rock Mining.
With the recent upsurge in EV sales, demand for graphite has been increasing rapidly. The demand in 2035 is expected to surpass last year’s total global supply by 6.5 times, according to market tracker Benchmark Mineral Intelligence.
Posco International plans to provide the graphite it receives during the contract period to Posco FutureM, Posco Group's battery material business.
In addition, the company also supplies raw materials for copper foil -- another component used in rechargeable batteries -- and provides material for recycling discarded batteries to Posco HY Clean Metal, its battery recycling company.