Lopal and EVE Energy Ink $694mn LFP Cathode Supply Deal

Lopal

Strategic Partnership for Malaysian Battery Production

Chinese lithium iron phosphate (LFP) cathode producer Jiangsu Lopal has signed a landmark supply agreement with EVE Energy’s Malaysian subsidiary, underscoring the growing importance of Southeast Asia in the global battery supply chain. The five-year deal covers the delivery of 152,000t of LFP cathode material between 2026 and 2030, with a total estimated value exceeding 5bn yuan ($694mn). The agreement includes flexibility clauses allowing EVE Energy to adjust order volumes within predefined limits, while pricing will be determined quarterly to reflect market conditions.

EVE Energy began operating its first overseas battery manufacturing facility in Malaysia in February 2025. The plant, designed with an annual output capacity of 680mn cylindrical batteries, primarily serves the electric tool and electric two-wheeler markets. By sourcing LFP cathode materials locally within Asia, EVE Energy aims to strengthen supply chain resilience and reduce exposure to cross-border trade risks.

Global LFP Supply Chain Diversification

Lopal has emerged as one of China’s most prominent LFP cathode producers since acquiring the business from Shenzhen BTR New Energy Material. The company operates large-scale production complexes across Jiangsu, Shandong, Tianjin, Sichuan, and Hubei, giving it significant domestic manufacturing coverage and the ability to meet large-volume contracts. In addition to EVE Energy, Lopal has also secured long-term supply deals with Cornex and Ford Motor Company this year, further expanding its customer portfolio.

This deal comes amid escalating US–China trade tensions, particularly in the energy storage sector. The United States has imposed a 40.9pc tariff on Chinese-produced LFP batteries for energy storage systems (ESS), driving manufacturers to diversify production locations. China still produces over 90pc of the world’s LFP batteries, but other countries are rapidly entering the market. LG Energy Solution (LGES) in South Korea has already started mass production of LFP batteries in the US, signaling a shift in global production strategies.

With geopolitical pressures, fluctuating raw material prices, and the ongoing global push for electrification, long-term supply contracts like this one between Lopal and EVE Energy are becoming increasingly critical for securing stable production pipelines and competitive advantage.

The Metalnomist Commentary

This agreement reflects a broader industry shift toward decentralizing battery material production across multiple regions to reduce geopolitical and logistical risks. As global demand for LFP batteries accelerates, Southeast Asia is poised to become a crucial manufacturing hub, offering both cost efficiency and strategic proximity to major markets.