Posco paid about $41,500 per tonne of yearly capacity for its second Argentine brine plant
Posco Holdings spent $954 million on the upstream stage of its second Argentine brine plant, lifting capacity there to about 48,000 tonnes a year. Half of the 50,000-tonne hydroxide chain it advertises will come from a Korean refinery that is still being built.
The Investor · Invest desk
What happened
- Posco bought mining rights to the Salar del Hombre Muerto, a salt flat on the border of Salta and Catamarca provinces, in 2018.
- Seoul Economic Daily says a 50,000-tonne hydroxide chain holds enough lithium for about 1.25 million electric vehicles.
- Posco plans third and fourth plants of 25,000 tonnes each, aiming for 100,000 tonnes a year of brine lithium capacity by 2033.
- The Salta and Catamarca provincial governments signed a memorandum with Posco pledging cooperation on permits for those two plants.
Why it matters
- What it costs cost At the second plant's upstream rate, the third and fourth plants would cost about $2.1 billion before any refining, and the provincial memorandum commits Posco to none of that spending.
- What it limits constraint Growth past 50,000 tonnes is sized in carbonate and, by Seoul Economic Daily's account, aimed at storage batteries, so the 2033 target is a brine-output goal separate from the hydroxide chain.
- What's now possible capability Refining the second plant's carbonate in Gwangyang puts the hydroxide step inside Korea under Posco's own operation.
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Spread across 23,000 tonnes a year of lithium carbonate [3], the $954 million Posco put into the upstream stage [2] comes to about $41,500 per tonne of annual capacity [17]. That money pays for the step that pulls carbonate out of brine at the salt lake [8], about 4,000 metres above sea level [12].
The announcement's tonnages mix two chemicals. The 48,000 tonnes now installed in Argentina adds the new plant's carbonate to the 25,000 tonnes of a first plant that has run since 2024 [4][5]. The 50,000-tonne hydroxide system [7] counts that first plant plus 25,000 tonnes from a converter at the Yulchon Industrial Complex in Gwangyang, scheduled for next year [6][18]. Going by the reported figures, each tonne of carbonate shipped to Yulchon becomes about 1.09 tonnes of hydroxide [19].
Both reports frame the result as ownership. Korea Herald calls it "an independently operated brine-based lithium hydroxide production system" [7]. Seoul Economic Daily's electric-vehicle count works out to 40 kilograms of hydroxide a car [21]. The reports do not mention China, give a cost for Yulchon or quote a lithium price.
If Yulchon opens on time and the second plant reaches full operation as quickly as Posco plans, according to Korea Herald [14], the 50,000 tonnes exists next year. Adding the two planned plants to today's 48,000 tonnes gives 98,000 [20], a little short of the 2033 goal [9].
I think the second plant is best judged for now as feedstock for Posco's own chain. Posco Group chair Chang In-hwa said, "We will continue to secure competitive resources in advance, turn them into production and earnings and ensure a stable supply of critical minerals needed by South Korean industries" [13]. The plant delivers the production and the supply once Yulchon runs. Earnings depend on what lithium sells for. The counter-case is that about $41,500 per tonne of capacity [17] is a cheap way into a brine field Posco controls, whatever the price does next year. The view fails if Yulchon misses its schedule, because the second plant's carbonate is committed to that converter [6].
What to watch
- A capital budget or final investment decision for the third and fourth plants, set against the roughly $41,500-a-tonne cost of the second plant's upstream stage.
- Named buyers or offtake contracts for the hydroxide the Yulchon converter is due to produce.
- Permits granted by Salta and Catamarca under the new memorandum.
Information, not investment advice. This story is general information about companies and markets, drawn from cited reporting. It is not a recommendation to buy, sell or hold any security; check the cited sources before acting.
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- [1]
Posco Holdings held a completion ceremony Monday for the upstream process of its second brine lithium plant near the Salar del Hombre Muerto in Argentina.
- [2]
Posco invested about $954 million in the upstream portion of the second plant.
- [3]
The upstream portion of the second plant has annual capacity to produce 23,000 tons of lithium carbonate.
- [4]
The first plant has been operating since 2024 with an annual capacity of 25,000 tons.
- [5]
Combined with the first plant, Posco's lithium production capacity in Argentina has increased to about 48,000 tons a year.
- [6]
Lithium carbonate from the second plant will be converted into 25,000 tons a year of high-purity lithium hydroxide at a downstream plant scheduled for completion next year at the Yulchon Industrial Complex in Gwangyang, South Jeolla Province.
- [7]
Together with existing capacity, the project will give Posco an independently operated brine-based lithium hydroxide production system with an annual capacity of about 50,000 tons.
- [8]
The second plant is divided into an upstream process that extracts lithium carbonate from brine at the local salt lake and a downstream process that brings the material to South Korea and refines it into battery-grade lithium hydroxide.
- [9]
The third and fourth plants will each have an annual capacity of 25,000 tons on a lithium carbonate basis, and their completion would bring brine lithium capacity to 100,000 tons by 2033.
- [10]
POSCO Argentina signed a memorandum of understanding with the provincial governments of Salta and Catamarca to pursue the third and fourth plants, winning pledges of cooperation on permits.
- [11]
Posco acquired mining rights to the Salar del Hombre Muerto, a salt flat on the border of Salta and Catamarca provinces, in 2018.
- [12]
The second plant is near the Salar del Hombre Muerto, about 4,000 meters above sea level.
- [13]
"We will continue to secure competitive resources in advance, turn them into production and earnings and ensure a stable supply of critical minerals needed by South Korean industries," said Posco Group Chair Chang In-hwa.
- [14]
Posco Holdings plans to bring the second plant to full operation quickly while stepping up investment in its planned third and fourth plants.
- [15]
The 50,000-ton lithium hydroxide volume is enough for about 1.25 million electric vehicles.
- [16]
POSCO Group is moving faster on investment in third and fourth plants to meet growth in the energy storage system market driven by AI data centers and rising demand for lithium iron phosphate batteries.
- [17]
The upstream stage cost about $41,500 per tonne of annual lithium carbonate capacity.
- [18]
Of the roughly 50,000-tonne hydroxide system, 25,000 tonnes (half) comes from the Yulchon converter due next year; the other 25,000 tonnes is existing capacity, matching the first plant.
- [19]
The reported figures imply about 1.09 tonnes of lithium hydroxide per tonne of carbonate converted at Yulchon.
- [20]
Adding the planned third and fourth plants to current Argentine capacity gives about 98,000 tonnes a year.
- [21]
The 1.25 million-vehicle figure implies about 40 kilograms of lithium hydroxide per electric vehicle.
- [22]
If the third and fourth plants cost per tonne what the second plant's upstream did, they would need about $2.1 billion between them before any refining.
Sources
2 independent publishers whose own reporting we read for this story.
- en.sedaily.comPOSCO Completes Base for 50,000-Ton Lithium Hydroxide Chain
1 article · October 7, 2026
- koreaherald.comPosco completes second Argentina lithium plant
1 article · October 6, 2026
Topics and entities
Topics
- Critical Minerals Supply Chain
- Lithium Brine Extraction
- Lithium hydroxide
Entities
- Salar del Hombre Muerto
- Yulchon Industrial Complex