Sodium-ion batteries arrive: Kiwoom Securities picks LG Energy Solution and POSCO Future M

Sodium-ion batteries (SIBs) have left the laboratory and entered commercial mass production, according to a battery industry report published on the 16th by Kiwoom Securities, one of South Korea's leading brokerages.

The report highlights CATL, the world's largest battery maker, as the driving force behind this transition. The Chinese firm launched its SIB brand "Naxtra" in April 2025, and by April 2026 had formally announced the establishment of gigawatt-hour-scale mass production. The world's first mass-produced passenger electric vehicle powered by a sodium-ion battery—developed in partnership with Changan Electric Vehicle—was officially launched at end of June 2026. CATL has also secured consecutive orders for sodium-based energy storage systems (ESS) in Europe under its "TENER Sodium" brand, with the first domestic Chinese ESS delivery scheduled for September 2026.

China accounts for more than 95% of global SIB production, Kiwoom estimates. Three companies—CATL, BYD, and HiNa Battery—dominate the market, with China representing an estimated 92% of global shipments of roughly 9 gigawatt-hours in 2025. Even so, total SIB output remains below 1% of global lithium-ion battery production.

A technology with clear strengths—and clear limits

The report identifies low-temperature performance and raw-material costs as SIBs' two principal advantages. The latest cells retain more than 90% of their nominal capacity at minus 40 degrees Celsius. Unlike lithium-ion batteries, which consume 5–10% of stored energy on internal heating in cold conditions, SIBs impose a far smaller thermal burden. On materials, sodium carbonate—the key feedstock—costs between one-sixtieth and one-eight-hundred-and-thirtieth of lithium carbonate, and is far less volatile in price.

Yet SIBs face structural constraints. Their current price is estimated at roughly 1.3 times that of lithium iron phosphate (LFP) batteries, a widely used and relatively cheap alternative. Energy density reaches a maximum of 175 watt-hours per kilogramme, trailing LFP (up to 205Wh/kg) and nickel-cobalt-manganese (NCM) batteries (up to 300Wh/kg). This makes SIBs poorly suited for long-range passenger vehicles. Kiwoom concludes that SIBs will not wholesale replace LFP, but will instead penetrate selectively in applications such as grid-scale energy storage, commercial vehicles, entry-level electric vehicles, and two-wheelers.

The cost bottleneck: hard carbon anodes

The primary obstacle to cost competitiveness is the hard carbon anode material. The manufacturing cost gap between SIBs and LFP batteries arises more from production processes than from cathode materials. The NFPP (sodium iron phosphate pyrophosphate) production cost is approximately 0.15 yuan per watt-hour, compared with 0.03 yuan/Wh for LFP—a gap of 0.12 yuan/Wh. Kiwoom forecasts that manufacturing costs could fall by 30–40% once cumulative production reaches 100GWh.

Chinese government policy has also tilted in SIBs' favour. From 1 September 2026, Beijing will impose a 2% consumption tax on lithium-ion batteries; sodium-ion batteries will be exempt until 31 December 2028—a deliberate measure to accelerate SIB commercialisation.

A conditional advantage

Kiwoom cautions that the economics of SIBs are contingent on lithium prices. When CATL's Yichun mine in Jiangxi province halted operations in August 2025 after its mining licence expired, lithium prices rebounded and SIBs' cost advantage was thrown back into the spotlight. But should lithium carbonate prices fall below 80,000–100,000 yuan per tonne, the competitive case for SIBs would weaken considerably. The fate of Bedrock Materials, an American SIB start-up that shut down its sodium cathode development in April 2025 and returned most of its investor capital—following an 85%-plus collapse in lithium prices—serves as a cautionary precedent.

South Korea: lagging by at least two years

South Korean battery makers are trailing their Chinese rivals by a wide margin. LG Energy Solution converted one existing production line at its Nanjing factory in China in April 2026, establishing a pilot line with annual capacity of 200 megawatt-hours, with a target to begin sample shipments to ESS customers in 2027. Samsung SDI has formally announced plans to pursue sodium battery mass production, targeting the uninterruptible power supply (UPS) market for artificial intelligence data centres as its initial application. In July 2026, EcoPro BM, Soulbrain, and Aekyung Chemical formed the "K-Sodium Alliance" to jointly develop cathode materials, electrolytes, and hard carbon in an integrated package.

Nevertheless, Kiwoom judges that South Korean firms will not achieve mass-production scale before 2028—at least one to two years behind China. The scale disparity is stark: LG Energy Solution's 200MWh pilot line stands in sharp contrast to CATL's gigawatt-hour operations. Chinese companies have accumulated roughly four years of commercial experience spanning materials, cells, and finished vehicles, while the South Korean ecosystem is still in its infancy.

Investment implications

Within the SIB value chain, Kiwoom identifies hard carbon anodes, cathode materials, and aluminium foil as the materials most likely to benefit. Aluminium foil is particularly notable: because it can be used as the current collector at both the positive and negative electrodes in SIBs—unlike in lithium-ion batteries—consumption per gigawatt-hour is roughly double that of conventional cells.

Sama Aluminium (삼아알미늄) is currently in discussions with CATL over aluminium foil supply for SIBs. LG Energy Solution and Toyota Tsusho each hold a 9.92% stake in Sama Aluminium, making them joint second-largest shareholders. The company returned to profitability in the second quarter of 2026, with ESS-related shipments picking up.

Kiwoom's top picks are LG Energy Solution (target price: 500,000 won; Buy maintained) and POSCO Future M (target price: 290,000 won; upgraded to Buy). POSCO Future M is singled out as the only South Korean company with the capability to develop both cathode and anode materials for SIBs simultaneously—a distinction that prompted the upgrade from Outperform to Buy. Sama Aluminium is also highlighted, though without a formal rating.

Investors should note, however, that domestic South Korean SIB companies remain at the sample and testing stage. A meaningful contribution to earnings is not expected any time soon.