Core Viewpoint - The article discusses the strategic collaboration between POSCO Future and Zhongwei New Materials to advance LFP cathode materials, highlighting the challenges faced by Korean and Japanese battery manufacturers in decoupling from the Chinese lithium battery supply chain [2][3][8]. Group 1: Strategic Collaborations - POSCO Future and Zhongwei New Materials signed a Memorandum of Understanding (MOU) to discuss the construction of LFP cathode material production facilities to supply the ESS market [2]. - The collaboration builds on previous partnerships in the production of precursor materials, indicating a long-term strategy to enhance LFP production capabilities [10]. Group 2: Market Dynamics - The demand for LFP batteries is increasing, particularly in the energy storage sector, prompting Korean and Japanese companies to shift their focus from ternary batteries to LFP technology [6][8]. - Despite the growing interest in LFP, the global production capacity remains highly concentrated in China, making it difficult for non-Chinese entities to establish competitive LFP production [8][9]. Group 3: Regulatory Environment - The "Big and Beautiful" Act has introduced restrictions that impact the supply chain for Korean and Japanese battery manufacturers, limiting their ability to source materials from certain foreign entities [7]. - These regulatory changes have led to a strategic pivot among major battery manufacturers, emphasizing the need for localized supply chains to meet increasing energy demands in the U.S. market [6][7]. Group 4: Future Outlook - Chinese LFP cathode materials are expected to become increasingly dominant in the global market starting in 2025, with companies like Longpan Technology securing long-term supply agreements [9]. - The reliance on Chinese materials for LFP production indicates that even companies like POSCO Future will need to maintain ties with Chinese suppliers to achieve their production goals [10].