POSCO commissions new hot strip mill at Gwangyang works

SEOUL (Scrap Monster): South Korean steel major-POSCO has officially launched its new hot strip mill at Gwangyang works in South Jeolla late last week.

The company claims that the core facilities of the plant including the furnace was designed and created with its own technology. The evaporating cooling system installed in the new furnace is believed to help the company save $5.67 million in costs every year.

The new No.4 HRC mill has a total capacity of 3.3 million tonnes per year. The company plans to export bulk of the HRCs produced by the new mill to its own re-rolling subsidiaries overseas. The 1.2 to 22 mm thick and 700-1,950 mm wide HRCs rolled out from the mill would mainly serve the increasing demand from high-end automotive sector. The products are intended to serve global automakers including Volkswagen, Toyota, Ford and Nissan.

In recent years, Hyundai Steel has made deep inroads into the Korean automotive sheet market. The rolling out of new flat capacity in the region and the tie-up with KIA Motors, a subsidiary of the same group entity, Hyundai Motors has resulted in creation of huge market share by Hyundai Steel. By commissioning the new mill, POSCO expects to regain part of its lost market share.

The new move is part of POSCO’s restructuring plans to boost the margins by focusing on its core area on high-end steel flat products. The company has also decided to sell its Steel division to SeAh Group.