MOROGORO, Tanzania—POSCO International has officially commenced the development of the Mahenge graphite mine in Tanzania, one of the world's largest natural graphite deposits, in a move that significantly bolsters the company’s efforts to stabilize the global supply chain for electric vehicle (EV) battery materials. The groundbreaking ceremony for the project, located in the Ulanga area of the Morogoro Region, was held on October 9 (local time), marking a pivotal moment in the expansion of Korea's mineral resource security.
The Mahenge mine, which holds an estimated 6 million tons of natural graphite reserves, is being primarily developed by the Australian resource firm Black Rock Mining, with POSCO Group participating as a strategic partner. This initiative is particularly notable as it is part of the Mineral Security Partnership (MSP), a multilateral consultative body led by major countries including South Korea, the United States, Japan, and the European Union, aimed at securing a stable supply of critical minerals.
Addressing Global Supply Chain Risks
Graphite is an essential component for producing anodes in EV batteries. However, the global supply chain for this crucial mineral is highly concentrated, with China currently dominating over 70% of the world's supply. This heavy reliance has been flagged as a significant geopolitical risk, prompting major economies to actively seek diversification.
Recent international trade measures underscore the urgency of this diversification. The US Commerce Department's preliminary decision to impose high anti-dumping tariffs, potentially reaching up to 160% on Chinese graphite, effectively blocks its entry into the US market. Such robust trade actions, alongside China's own recent export restrictions on high-purity graphite, have intensified the global push by governments and the automotive/battery industries to establish resilient, non-Chinese supply networks.
POSCO Group's Strategic Investment
POSCO Group's involvement in the Mahenge project began in 2021 when POSCO Holdings invested $7.5 million in Black Rock Mining. The group's commitment has since deepened, with POSCO International signing two separate contracts in 2023 and 2024 to secure an annual off-take of 60,000 tons of natural graphite.
Upon the completion of a recent $40 million investment by POSCO International, the POSCO Group's total stake in Black Rock Mining is set to expand from 7.45% to 19.9%. This strategic investment not only secures long-term supply but also strengthens the partnership.
When the mine is projected to begin commercial production in 2028, POSCO International will receive a stable annual supply of 60,000 tons of natural graphite for approximately 25 years. This guaranteed supply will be channeled to POSCO Future M for the production of anode materials, significantly boosting the group's self-sufficiency rate for secondary battery raw materials.
A New Chapter for Mineral Security
POSCO International views the Mahenge development as a crucial opportunity to expand its resource development capacity in Africa. A company official stated, "We expect the Mahenge graphite mine development project to contribute to strengthening POSCO Group's competitiveness in the anode business, stabilizing the global battery material supply chain, and further, to Korea's mineral security."
By securing a long-term supply of high-purity natural graphite from a politically stable source outside of China, the project is poised to play a vital role in enabling Korean battery manufacturers to comply with evolving international regulations, such as the US Inflation Reduction Act (IRA), while accelerating the global transition toward sustainable mobility.
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