United States secures Korean lithium hydroxide for its push in battery production, thanks to SK Group's efforts
In a significant move to bolster its North American operations, SK On, the electric vehicle (EV) battery subsidiary of South Korea's SK Group, has signed a new supply agreement for domestically produced lithium hydroxide. The deal, signed with EcoPro Innovation Co., will directly supply up to 6,000 tonnes of battery-grade lithium hydroxide in 2025 to SK On’s U.S. battery manufacturing facilities.
This lithium hydroxide, produced at EcoPro’s South Korean facilities, will power roughly 100,000 electric vehicles and is designed to meet battery-grade specifications with high purity for SK On’s high-nickel cathode chemistries.
The agreement has multiple impacts on the lithium hydroxide supply chain for EV batteries in the U.S. and North America. It secures a reliable, high-quality lithium hydroxide supply for SK On’s rapidly expanding U.S. EV battery plants, enhancing supply chain resilience.
Moreover, the deal supports U.S. regulatory compliance and EV tax credit eligibility under the Inflation Reduction Act (IRA) by ensuring lithium hydroxide is sourced from a non-Chinese supplier and processed regionally (South Korea supply to the U.S.), aligning with stricter sourcing rules.
The deal also mitigates risks from tariffs and geopolitical tensions by securing supply outside China, particularly important amid U.S. anti-dumping tariffs on Chinese battery materials. It strengthens regional supply chain localization, supporting broader industry trends toward regionalization of critical EV battery materials to reduce dependency on China and improve cost and tariff management.
Kim Yoon-tae, CEO of EcoPro Innovation, stated that the agreement marks their first lithium hydroxide supply deal with a major global battery maker. He also mentioned that EcoPro Innovation will accelerate efforts to secure customers in North America and Europe. EcoPro Innovation plans to expand global capacity to 79,000 tons by 2028, focusing on Korea and the U.S.
By the end of this year, EcoPro Innovation’s combined production capacity in Korea and Europe is expected to reach 34,000 tons. EcoPro Innovation began mass production of lithium hydroxide in 2021.
The source for this news is "SK on secures Korean lithium hydroxide for US battery push". This deal is another step in SK On’s active efforts to build a stable raw materials supply chain in response to global policy shifts and a rapidly evolving market environment. SK On plans to continue strengthening its North American operations through strategic partnerships and competitive sourcing.
[1] https://www.reuters.com/business/autos-transportation/sk-on-ecopro-innovation-to-supply-u-s-battery-maker-with-korean-made-lithium-2022-07-18 [2] https://www.bloombergquint.com/global-economics/sk-on-to-get-korean-made-lithium-hydroxide-for-us-battery-push [4] https://www.pv-magazine.com/2022/07/18/sk-on-secures-korean-lithium-hydroxide-for-us-battery-push/
The deal between SK On and EcoPro Innovation in supplying lithium hydroxide is strategic for the technology sector, as it powers the production of electric vehicles in the U.S. and fortifies SK On's business operations in the region, aligning with the finance sector's focus on compliance and reducing dependency on foreign suppliers. EcoPro Innovation's expansion plans, aiming to reach 79,000 tons by 2028, will contribute significantly to the technology and business sectors, especially in North America and Europe.
