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POSCO Boosts Competitiveness With Localized R&D for Critical Minerals

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Key Takeaways

  • POSCO unveiled a research and development lab in Perth to boost battery materials and rare earths.
  • The lab supports POSCO's drive for raw material localization and carbon-reducing innovations.
  • PKX aims to advance tech in lithium, nickel and rare earths through local collaboration.

POSCO Holdings (PKX - Free Report) has opened the Australia Critical Minerals R&D Lab in Perth with the goal of achieving ultra-gaps in technological competitiveness in the steel, battery material, raw materials and rare earth industries. This is the first time a Korea-based corporation has set up a resource research institute on-site, where raw materials are stored.

POSCO has been working closely with the Australian government and industry to become a leading global steel and battery materials firm since obtaining its initial iron ore supply from the country in 1971. The Australia Critical Minerals R&D Lab will integrate the country's vast resources with the POSCO Group's materials technology skills, adding value to the Group's core businesses while also serving as a strategic hub for raw material processing technologies and critical mineral acquisition.

The POSCO Group has recognized the necessity of localization methods in the steel and battery materials industries, which have high raw material cost ratios. This extends beyond cost-effective raw material procurement to ensuring technological competitiveness in carbon reduction. 

The Critical Minerals R&D Lab in Australia will serve as a hub for the Group's critical mineral research and development, including project execution in partnership with local raw material companies and research institutions in the company's core business areas, such as cost-effective low-carbon steel raw material utilization technology and cost-cutting technology in the lithium and nickel raw material sectors. Furthermore, the research institute intends to conduct parallel research on rare earth supply chains as well as high-efficiency separation and refining technologies in order to identify next-generation vital mineral business possibilities and encourage investment in global premier mines through local knowledge exchange.

In the past year, shares of PKX have lost 27.7% compared with the industry’s 27.3% decline.

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PKX’s Rank & Other Key Picks

PKX currently carries a Zacks Rank #2 (Buy).

Other top-ranked stocks in the basic materials space include Carpenter Technology Corporation (CRS - Free Report) , Alamos Gold Inc. (AGI - Free Report) and Hawkins, Inc. (HWKN - Free Report) .

Carpenter Technology currently carries a Zacks Rank #1 (Strong Buy). CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 11.1%. The company's shares have soared 139.2% in the past year. You can see the complete list of today's Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Alamos Gold current-year earnings is pegged at $1.24 per share. AGI, carrying a Zacks Rank #1, surpassed the Zacks Consensus Estimate in two of the trailing four quarters while missing twice, with an average earnings surprise of 1.4%. The company's shares have rallied 65.1% in the past year.

Hawkins, which currently carries a Zacks Rank #2, beat the consensus estimate in one of the trailing four quarters while missing thrice. In this time frame, it has delivered an earnings surprise of roughly 8.2%, on average. The company's shares have rallied 54.6% in the past year.

 

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