Investments from South Korean and Chinese battery companies are flocking to Morocco, where LG Chem has been paying attention as a production hub. The country is rich in essential mineral resources used in battery materials and has free trade agreements with the United States and Europe. The continuous establishment of global car factories in Morocco amid a fast-paced transition to electric vehicles is also considered a geographical advantage.
According to industry sources on Jan. 30, China’s BTR, a leading global anode material company and a subsidiary of China Baoan Group, recently announced plans to invest $500 million (about 668.7 billion won) in Morocco to construct an anode production plant. BTR, with Tesla as one of its major clients, held a 26% market share in anode materials in 2022, maintaining its top position since 2013.
BTR is not the only Chinese battery-related company investing in Morocco. Tinci Materials, a Chinese material company, invested $260 million (about 360 billion won) in June last year for battery material production in Morocco. Gotion High Tech, one of China’s top four battery companies and majorly owned by Germany’s Volkswagen, is considering investments of up to $6.3 billion (about 8 trillion won).
In South Korea, LG Chem is collaborating with China’s Huayou Group to establish a joint venture plant in Morocco for LFP (lithium iron phosphate) cathode materials with an annual capacity of 50,000 tons with a goal of mass production by 2026. “Morocco is an FTA partner and rich in phosphate, making it optimal for producing LFP series,” said Shin Hak-cheol, Vice Chairman of LG Chem, at a New Year’s greeting speech for the petrochemical industry on Jan. 10.
Africa, including Morocco, holds over 30% of the world’s minerals, such as lithium, nickel, and graphite. Morocco has 75% of global phosphate ore reserves, an essential raw material for LFP batteries. The country has signed FTAs with the U.S. and the European Union (EU), allowing the cathode materials produced in the region to benefit from the U.S. Inflation Reduction Act and the EU Critical Raw Materials Act.
