Battery Material Overcomes 'Slump' and Rebounds in Second Half... The Key is 'Decoupling from China'

[Financial News] With the slowdown in electric vehicle demand and the rise of Chinese companies, the domestic battery industry, which has received poor report cards, is seeing increased expectations for a rebound in performance in the second half. This is because the 'decoupling from China' movement in the battery supply chain is becoming more pronounced, centered around the United States. Material companies, which already play the 'vein' role in the battery supply chain, are already receiving 'love calls' from global customers.
According to industry sources on the 22nd, domestic battery material companies recorded operating losses in the first half of this year, unable to avoid poor performance. In the case of Posco Future M, sales in the energy business sector, which sells battery materials, were 315.4 billion won, with an operating loss of 25.5 billion won in the 2nd and 4th quarters of this year. Compared to the same period last year, sales decreased by 46.8%, and operating profit decreased by 2061.5%, turning into a deficit.
L&F and EcoPro BM, which have not yet announced their 2nd and 4th quarter results, are also expected to be in a similar situation. According to financial information company FnGuide, L&F's 2nd and 4th quarter consensus (market forecast) is sales of 579.7 billion won and an operating loss of 57.5 billion won, recording a deficit for seven consecutive quarters. EcoPro BM's sales were 724.7 billion won, down 10.4% compared to the same period last year, while operating profit was 12.3 billion won, showing some improvement compared to last year's deficit.
There are many forecasts that the performance of battery material companies will rebound significantly in the second half. This is because the 'decoupling from China' trend in the battery supply chain, which is the key axis, is accelerating.
Earlier this month, US President Trump signed the 'One Big Beautiful Bill Act (OBBBA)', which is representative. The OBBBA includes a clause on prohibited foreign entities (PFE), including China. From 2026, the core of the bill is that the proportion of non-PFE raw materials used in US battery production must be increased to 60% to receive the Advanced Manufacturing Production Tax Credit (AMPC). This proportion will gradually increase, reaching 85% by 2030. Since AMPC accounts for an absolute proportion of battery companies' profits, 'decoupling from China' is essential to operate in the US market.
Domestic battery material companies are expecting 'windfall' benefits. This is because, excluding China, our country is the only place with an independent supply chain and large-scale production capacity in the global battery market.
Posco Future M's representative said, "Since we have completed our own supply chain from mining to intermediates such as precursors and cathode materials, we expect positive news in the second half," adding, "The anode material business is also expected to benefit from the recent imposition of anti-dumping duties on Chinese graphite by the US."
The decoupling from China trend is also leading to actual achievements for domestic material companies. Posco Future M recently signed an anode material supply contract with a major Japanese battery company, and L&F signed a business agreement to supply lithium iron phosphate (LFP) cathode materials to SK On this month. EcoPro Innovation also decided to supply up to 6,000 tons of lithium hydroxide to SK On from the second half of this year.
An industry official said, "As the decoupling from China supply chain trend accelerates in the US, the largest market for battery companies, the demand for domestic material companies, which are virtually the only alternative, will increase," adding, "This is expected to be partially reflected in the second half's performance." 
one1@fnnews.com Jeong Won-il Reporter