Legitimate! Katoda Production Facility INA-Changzhou Consortium Officially Begins

Coordinating Minister for Maritime Affairs Luhut Binsar Pandjaitan (Photo: dock. Antara)

Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan inaugurated the start of the first phase of production and the plan to expand the production facility for the Lithium Iron Phosphate (LFP) cathode by PT LBM Energi Baru Indonesia.

For information, LBM Energi Baru Indonesia is a consortium of the Indonesia Investment Authority (INA) and Changzhou Liyuan New Energy Technology Co., Ltd. (Changzhou Liyuan) which is one of the largest LFP producers and suppliers in the world.

As often stated by President Joko Widodo, Indonesia should no longer only be an exporter of raw materials. We must create added value in our own country, build a strong downstream industry, and place ourselves as a key player in the global supply chain. Downstream is not just a word, but a big strategy to accelerate Indonesia's progress, especially in sectors that will dominate the future: the electric vehicle ecosystem, Electric Vehicle (EV)," said Luhut, Tuesday, October 8.

The facility, which is located in Kendal Industrial Park (KIP), is projected to become the largest producer of Katoda LFP in the world outside China. The planned joint investment of 200 million US dollars aims to increase production capacity from 30,000 tons in phase I, which is currently in the implementation of pilot production, to 90,000 tons in phase II, which is expected to begin in 2025.

Just so you know, LFP is one of two main chemicals in lithium-ion batteries, alongside Nickel Cobalt Manganese (NCM). Known for its cost effectiveness, LFP is perfect for EVs and energy storage systems.

Based on Bain's study of the EV1 Battery Ecosystem, global battery demand is expected to grow about fourfold between 2023 and 2030, driven by the increasing adoption of EVs, positioning the LFP to play an important role in meeting these demands.

By 2030, NCM is projected to represent about 50 percent of lithium-ion battery demand, while LFP is expected to account for about 35 percent, both of which are expected to remain the centers of growth in the battery industry in the future.

This strategic partnership focuses on LFP cathode materials representing the highest added value in the battery value chain, thus allowing this facility to take advantage of the opportunities presented by the growing market.

This is not just a factory, but also the foundation of an integrated Indonesian EV ecosystem. Through the improvement of the lithium battery production chain, no less than 3 million units of electric vehicles around the world will be met with the demand for lithium batteries by industry in Indonesia," said Luhut.