LG Energy Solution is strengthening its supply chain for lithium, a key raw material for high-capacity electric vehicle batteries in the U.S. FTA region.
On the 14th, LG Energy Solution announced that it has signed a lithium concentrate supply contract with Australian lithium producer WesCEF (Wesfarmers Chemicals, Energy & Fertilisers). Lithium concentrate is a high-purity mineral produced by processing lithium ore, serving as a raw material for lithium hydroxide and lithium carbonate.
LG Energy Solution is set to receive 85,000 tons of lithium concentrate from WesCEF over the course of this year. This quantity is enough to produce 11,000 tons of lithium hydroxide, sufficient for batteries powering approximately 270,000 high-performance electric vehicles capable of driving over 500 km on a single charge. The two companies are also discussing additional supply contracts for the future.
WesCEF is a subsidiary of Wesfarmers, one of Australia’s top ten companies. WesCEF entered the lithium production business by investing in the Mount Holland mining project located in Western Australia in 2019. Additionally, they have established a joint venture with Chile’s SQM (Sociedad Químicay Minera), recognized as the world’s largest lithium producer, to jointly develop mining and lithium hydroxide production facilities.
Previously, LG Energy Solution secured a contract to purchase 50,000 tons of lithium hydroxide produced by WesCEF starting in 2025 for a duration of five years. The lithium hydroxide supplied by WesCEF meets the entire requirements for IRA subsidies.
Both companies plan to continue collaborating to establish a strong supply chain for key minerals and raw materials within the U.S. FTA area, based on their firm strategic partnership.
Lee Kang-yeol, executive director of LG Energy Solution’s procurement center, stated, “As a global leader in batteries, we intend to enhance the value of sustainability across our entire business, including products and supply chains, in line with global electrification trends and clean energy policies. We will expand strategic partnerships with high-potential companies like WesCEF to secure core raw materials stably and ultimately manufacture batteries at competitive prices.”
LG Energy Solution is working towards creating a structural management environment that allows for stable procurement of core raw materials, even in the face of unpredictable supply chain shocks, such as sharp price increases for raw materials in specific countries.
Within the U.S., they are engaging in comprehensive collaboration with material-related partners to meet IRA subsidy requirements and are striving to maintain a competitive edge in price and supply capabilities in regions outside the U.S.
Previously, LG Energy Solution secured: 25% of lithium concentrate produced by Australian Green Technology Metals in Canada, 100,000 tons of lithium hydroxide and carbonate from Chile’s SQM, and 700,000 tons of lithium concentrate from Australian Liontown.
By Lee Sang-jin, daedusj@autodiary.kr