U.S. President-elect Donald Trump speaks during a news conference at Mar-a-Lago in Palm Beach, Fla., Monday (local time). AP-Yonhap

The stock prices of Korean producers of cathode materials and copper foil plummeted Tuesday, following reports of U.S. President-elect Donald Trump's transition team seeking to impose tariffs on all battery materials globally and then negotiating individual exemptions with allies.

Investors dumped their shares in Korean electric vehicle (EV) battery firms, amid growing fears about the possibility that those companies could bear heavier costs to avoid U.S. tariffs.

On Monday, Reuters reported that it obtained the transition team's documents recommending the introduction of tariffs on "EV supply chain" imports including batteries, critical minerals and charging components.

The news agency added that the incoming administration was also advised to use Section 232 tariffs, which target national security threats, to limit imports of such products.

Although the plans are interpreted as measures to curb the growth of China's EV and battery sectors, Korean companies are already being affected by Trump's protectionist trade policies.

For example, POSCO Future M's stock price plunged 8.24 percent during Tuesday's trading session, as investors expect the next U.S. president to urge the Korean firm to produce its battery materials on U.S. soil and reduce the use of low-priced minerals from China.

Stock prices of EcoPro BM, L&F and LG Chem, all of which produce cathode materials, also fell 7.8 percent, 4.2 percent and 4.1 percent, respectively.

Lotte Energy Materials, a copper foil maker, experienced a 5.47 percent drop in its stock price.

The stock prices of Samsung SDI and LG Energy Solution, two of Korea's listed EV battery manufacturers, went down by 6.08 percent and 3.89 percent, respectively.

"Tariffs on battery materials will likely be different, depending on the proportion of Chinese minerals they contain," Austin Chang, director of the Korea International Trade Association's (KITA) analysis and forecasting department, said.

"Considering that China's neglect of environmental pollution has enabled the supply of excessively low-priced minerals, battery materials firms will face higher production costs."

Chang also said that the hike in production costs will lead to a rise in the prices of batteries and EVs, eventually further slowing down the demand for eco-friendly vehicles.

"Korean battery firms will likely face intensifying competition with their Chinese rivals outside of the U.S.," he added.

Battery materials industry officials said that they have been paying close attention to the transition team's next step, as it remains uncertain as to how the Trump administration will negotiate with allies about the tariff issue.

"If Korea will be among allies exempt from tariffs, this could be an opportunity factor for us," a domestic battery materials company insider said on condition of anonymity.

According to the KITA, the volume of Korea's cathode materials exports to the United States reached 172,500 tons between January and November this year, up 14.1 percent from the previous year.