Posco Future M has signed a KRW 6 trillion (US$4.5 billion) master agreement to supply lithium iron phosphate (LFP) cathode active material to Samsung SDI, committing close to 400,000 tons over five years beginning in 2027 and running through 2032.

The battery materials arm of South Korea's Posco Holdings confirmed the contracted volume is more than double the 190,000 tons of LFP cathode covered by a previous agreement the two companies signed in August. All individual LFP supply contracts between the two sides have now been consolidated into the single master agreement.

What does the deal change?

The agreement locks in Posco Future M as the anchor LFP cathode supplier for Samsung SDI's domestic battery cell production through 2032. Posco Future M already supplies cathode and anode materials to all three major South Korean cell makers — Samsung SDI, SK On, and LG Energy Solution — placing it as a Tier 1 materials supplier across the Korean cell ecosystem.

Both companies said the master agreement lets Posco Future M raise capacity utilization at its cathode plants and firm up its upstream raw materials sourcing. Utilization rates have been a recurring concern across Korean cathode producers as global LFP cathode supply continues to expand.

Where does the partnership extend next?

Posco Future M and Samsung SDI intend to expand the collaboration into lithium manganese oxide (LMO) cathodes and synthetic graphite anodes. If both lines are commercialized, Posco Future M said, the company would become the only South Korean producer of NCA, LFP, and LMO cathodes — a portfolio it argues gives automakers and cell makers flexibility as sourcing requirements shift between chemistries.

The LMO and synthetic graphite work remains an announced intention rather than a confirmed supply contract. Only the LFP volume — 400,000 tons over 2027 to 2032 — carries a signed, volume-defined commitment under this announcement.

Why LFP, and why now

LFP cathode chemistry has historically been dominated by Chinese suppliers, while Korean cell makers built their early electric-vehicle programs around nickel-rich NCA and NCM cathodes for higher-energy applications. Supplying Samsung SDI with Korean-made LFP cathode positions the cell maker to offer an LFP cell option to its automaker customers without relying on imported Chinese material — a sourcing configuration the two companies frame as adaptable to changing requirements.

Posco Future M's partnership with Samsung SDI began in 2023 with NCA cathode supply. The new LFP master agreement adds a second cathode chemistry under contract between the two. The LMO cathode and synthetic graphite anode discussions would add a third chemistry pairing.

What to watch

• First scheduled LFP cathode deliveries under the master agreement are set for 2027.
• Utilization rates at Posco Future M's Korean LFP cathode plants as the larger committed volume flows through.
• Whether the LMO cathode and synthetic graphite anode discussions translate into a signed follow-on supply contract before the LFP deal closes out in 2032.
• How competing Korean cathode suppliers respond, given Posco Future M's claim that the expanded portfolio would make it the only domestic producer covering all three cathode chemistries.