Korea Iron and Steel Association: in 2010 a strong recovery of domestic steel

Author ：www.metal-stamping.com.cn Time：2010-1-29 15:17:03 Reading：

South Korea Iron and Steel Association said that steel consumption in South Korea in 2010 increased 12% to reach 51.4 million t, the major steel industry upturn. South Korea's steel consumption in 2009 amounted to 45.8 million t, down 22%. 2010 South Korea steel output 63 million t, up 11%, recovered to 2008 levels. South Korea's steel exports are expected to grow by 5% to 21 million t, while in 2009 South Korea's steel exports fell 3% to 20 million t.

South Korea's steel association expects 2010 domestic crude steel production 57.4 million t, will grow 17% year on year; in 2009 South Korea's crude steel output 49 million t, down 7.5%. South Korean steel mills, after the completion of investment in new capacity, new capacity in 2010 will be 500 ~ 6 million t, to reach 68 million t. The investment of steel industry in 2010 fell to 6.1 billion U.S. dollars, down 32%.

South Korea's largest steelmaker Pohang Steel Company also believes that the growth in domestic demand in 2010, steel prices. In early 2008, the South Korean steel mills benefited from strong demand and higher steel prices, but then the outbreak of the economic crisis, automotive, shipbuilding, and other steel industry demand declined significantly, forcing steel companies to reduce their output. December 2008 Pohang Iron and Steel Company in its 41 year history for the first time to be implemented due to sluggish demand production cut, cut until June 2009. Sluggish demand also forced the Pohang in May 2009 price of hot rolled coil will be substantially reduced by 20%.

Into the second half of 2009, global steel production began to grow again, the corresponding recovery in steel prices, in the Governments in implementing policies to stimulate the economy, led by iron and steel industry is the worst since the last recession in 10 years to recover. Steel prices after a short-term adjustment after the first half of 2010 will once again resumed their upward. Pohang Iron and Steel Company expects global steel demand in 2010 will reach 1.21 billion t, up 9%; the developed countries demand is expected to grow by 15%, 10% growth in emerging economies. As the domestic market economy, export demand, especially strong demand for automotive panels, Pohang Iron and Steel Company and South Korea also benefited from other steel companies.

With the steel market has been through the worst of times, Pohang Iron and Steel Company expects 2009 operating profit will reach 2.75 billion U.S. dollars, crude steel production down by 300,000 t, down to 29.5 million t. In July 2009, POSCO Gwangyang plant re-enable the No. 4 blast furnace, this annual production capacity of 3.1 million t of blast furnace shutdown in February 2009.

Although the prospects for a bright, but substantial recovery in the global economy has not yet arrived, iron and steel market, there is considerable risk. If Asia's economic growth lower than expected demand for steel remained in the doldrums, then the South Korean steel mills would be difficult to improve the profitability of the supply pressure to curb excess steel profit growth. POSCO is expected to market the worst of times, South Korea, China and Japan's steel supply exceeded demand by 20% ~ 30%. In October 2009, Pohang in South Korea to postpone the construction of three steel mills. Even in June 2010, demand growth is still insufficient to support the expansion. In the 2 quarter of 2010 before the end of the world's rapidly growing steel demand will not delay the expansion will help Pohang more flexible to respond to market changes.

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-sg