POSCO International is strengthening its position in the electric vehicle (EV) supply chain with the launch of its first corporate venture capital (CVC) fund, aimed at securing rare earth materials essential for EV motors.
The company has set up a 25 billion won (about $16 million) fund in collaboration with POSCO Investment. As part of its initial investment, 8 billion won will be directed toward a domestic firm specializing in rare earth separation and refining.
Heavy rare earth elements such as dysprosium and terbium are critical for high-performance permanent magnets used in EV drive motors, helping them maintain strength under high temperatures. However, their limited global supply has raised concerns about supply chain stability.
The investee company is equipped with advanced technology capable of refining rare earths into oxides with purity levels above 99.5% and further processing them into metals with 99.9% purity.
POSCO International is also expanding its global footprint by focusing on Southeast Asia. It plans to launch a $30 million joint venture in Malaysia for rare earth processing and is participating in a project in Laos. Together, these efforts are expected to secure around 4,500 tons of refined rare earth materials annually, with plans to scale up production beyond 10,000 tons.
The company is also moving into the North American market through a partnership with ReElement Technologies to build a refining plant with an annual capacity of 3,000 tons, expected to begin production in the second half of next year.
In addition, POSCO International aims to produce 3,000 tons of permanent magnets annually by 2028. Its broader strategy focuses on building an integrated rare earth value chain—from mining and refining to magnet production—linked with motor core manufacturing to enhance its competitiveness in the EV components industry.
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