Korean steel producers confident: Demand and prices on the rise
6. May 2021According to industry sources, Korea’s largest steelmaker Posco has now postponed repair work at its 3rd cold-rolled steel production facility in Gwangyang, South Jeolla Province until April to meet rising demand. The work was originally scheduled for mid-March. Cold-rolled steel is processed with presses at room temperature and has a smooth surface. It is mainly used for vehicles, household appliances and steel pipes. Another company, Hyundai Steel, had also postponed maintenance and repair work earlier this year to ramp up production.
Posco raised prices for hot-rolled steel sheets for the third time, from $72 per ton in January to $89 in February and again in March to $134. Hyundai Steel also plans to raise its prices by $45 per ton. According to the Ministry of Trade, Industry and Energy, the price of iron ore at China’s Qingdao port rose US$10 from earlier this year to US$176 per ton. An anonymous industry official said market conditions for Korean steelmakers have improved due to reduced imports from China. The Chinese economy is recovering faster than predicted from the effects of the Covid 19 pandemic and therefore needs more steel domestically. Steel demand is also stable in other countries as companies steadily recover from the previous economic slump.
Another industry representative said that demand for steel sheets will continue to rise and prices will climb accordingly. He cited higher consumption from the automotive industry and vessel construction as the reason. The trend points to more environmental friendliness: In the automotive industry, more and more new vehicles are being built with electric drivetrains, and gas engines are being used in shipbuilding. An increase in sales of electrical appliances in the domestic and entertainment sectors is also resulting in higher demand for cold- and hot-rolled steel.
Demand for steel and prices could continue to rise. Recently, the Korean government announced plans to build an additional 836,000 housing units by 2025. The price of steel scrap for further processing into flat steel and castings also rose sharply in February. Steel products in South Korea require certification with the KC mark or KC certificate, which is roughly equivalent to the European CE mark and currently applies to 730 different products. MPR International GmbH – Korea Certification is available to answer your questions regarding Korea certification at any time without obligation.
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