KMMI to Invest 300 Billion Won to Expand Magnet Production in Pohang
Key Facts
KMMI, a subsidiary of U.S.-based Evolution Metals & Technologies, plans to invest 300 billion won through 2030 to expand production of rare-earth and non-rare-earth magnets in the South Korean city of Pohang, the Korea Herald reported. The project aims to establish annual production capacity of 6,000 tons at a site covering about 118,000 square meters. The company said the expanded facility will supply magnets to the electric-vehicle, defense-equipment and semiconductor sectors, as well as other advanced industries. The announcement places the industrial expansion plans in the context of efforts to build supply sources outside China, as new U.S. restrictions on materials used in defense procurement approach. The announced figures are post-expansion capacity targets, not a description of current production.
Company data indicate that, once Pohang’s equipment is installed and operational, annual rare-earth magnet capacity is expected to rise from about 1,000 tons to nearly 10,000 tons. The targeted capacity includes about 6,000 tons of high-performance sintered magnets. These figures set out a broader scope than the 6,000-ton capacity target in the site announcement, with the company citing total rare-earth magnet output and sintered magnets within it. The company tied the increase to completion of equipment installation and the start of operations, steps required before the planned levels can be reached. In its statement, the company said the equipment supports an “expected tenfold increase in annual rare-earth magnet production capacity in Pohang.”
The project’s significance is tied to changing supply rules for U.S. defense procurement: from January 1, 2027, the United States is set to expand restrictions on certain permanent magnets, as well as tantalum and tungsten, if they originate in China, Russia, Iran or North Korea. The rules extend across the entire supply chain, from mining and refining to finished products. They also cover raw materials used in samarium-cobalt magnets. The Korea Herald reported that China accounts for about 70% of global rare-earth mining and about 90% of refining and processing. That share provides market context for efforts to diversify supply, while the impact of the new facility will depend on its ability to operate and qualify its products with buyers.
Evolution Metals announced on October 28 that about $28 million in local government grants are expected to support the expansion, subject to applicable conditions. The company also said it had secured about 754 tons of neodymium metal from sources outside China, received or committed for delivery through 2027. The volume offers an indication of the raw-material arrangements the company announced alongside its manufacturing expansion. But the expected funding and secured materials do not change the fact that targeted production capacity depends on completing equipment installation and bringing it online. The grants remain subject to their conditions, according to the company’s wording.
On product qualification, the company said two global Tier 1 electronics manufacturers had completed quality approval for seven grades of sintered magnets, while the eighth grade was in the final stages of customer approval as of November 2026. This reflects progress in qualifying products with industrial buyers, a process separate from building production capacity itself. The company had raised its fiscal 2026 revenue forecast on October 9 to a range of $10 million–$11 million, from $5 million–$8 million in its initial estimate issued on September 10. At the time, it maintained its fiscal 2027 forecast at $400 million–$460 million. These remain forecasts announced by the company, while the Pohang expansion depends on completing installation and commissioning milestones and obtaining customer approvals.
The company is scheduled to hold a ribbon-cutting ceremony and operational demonstration at the facility in Pohang on December 17, 2026. The date is the project’s next announced milestone, ahead of the U.S. restrictions on covered magnets in defense procurement taking effect on January 1, 2027. The company said those restrictions will apply to magnets from covered countries in eligible U.S. defense products. Between the two dates, installing and commissioning the equipment and demonstrating its capabilities remain part of the execution process separating the investment plan from the targeted capacity. The announced information did not provide a detailed timeline for reaching full annual capacity.