Shares of South Korean battery makers climbed sharply after a report that Chinese energy storage system (ESS) companies have effectively abandoned the U.S. market. Expectations that the ESS market will expand faster on the back of growing artificial intelligence data center investment also supported the gains.
Samsung SDI (006400) traded at 588,000 won as of 2:15 p.m. on the 19th, up 10.94% from the previous session, according to the Korea Exchange. LG Energy Solution (373220) rose 6.33% to 428,500 won, while SK Innovation (096770) gained 6.25% to 161,500 won. On the KOSDAQ market, EcoPro (086520) advanced 7.87% to 87,700 won and EcoPro BM (247540) rose 6.27% to 113,600 won. The gains spread across the entire value chain, from finished battery manufacturing to materials supply.
Driving the buying was the prospect of a shift in the competitive landscape of the U.S. ESS market. Taiwanese technology publication DigiTimes reported that Chinese ESS companies have effectively withdrawn en masse from their U.S. operations this year because of tough American regulations, tariff burdens and strict equity screening. The report fueled expectations that Korean battery and ESS companies will gain market share in the United States, lifting their shares.
Rising ESS demand tied to expanding AI data center investment is also drawing attention. Among major clean power sources, solar and wind output varies with weather and time of day. ESS, which stores electricity and supplies it when needed, can offset that variability. A series of brokerage analyses showing the North American ESS market growing faster than expected has drawn investor interest. Brokerages are focusing on record-high new ESS installations in North America in the second quarter and on U.S. companies' intensifying efforts to reduce reliance on China.
"If Chinese companies pull out of the U.S. market, Korean companies are likely to benefit," an official in the securities industry said. "But we need to look closely at the actual scale of the withdrawal and how much it will lift earnings at individual Korean companies."
