Hyundai Steel Captures $3 bln Export Tower Award
2nd blast furnace steel plant in Korea given credit for reducing steel imports with diverse steel products
Hyundai Steel traces its history back to 1953 when Korea Heavy Industrial Corp., a state-run steel firm, was launched and the steel company was privatized in 1962. Hyundai Group took over the company in 1978. In 2000, the group also took over Kangwon Industry and Sammi Special Steel and merged them. Hyundai Motor Group acquired them in 2001 and merged them with Hanbo Steel with plants in Dangjin in 2004. Hyundai Steel now has steel plants in Incheon, Pohang, in addition to Dangjin, which is equipped with two blast furnaces that came online in October, last year and July, this year to become the second steel work to operate blast furnaces in Korea after POSCO.
The steel mill is known to have a top portfolio in its steel products produced at its plants as it includes diverse products ranging from rods, steel casting and to hot roll to name some. The steel company has six steel products named by the Ministry of Knowledge Economy to be tops in the world including H beam, hot roll, steel casting caterpillar tractor, and angle, among others.
The company exported $1 billion worth of its steel products in 2005, and then it rose to $2 billion in 2008 and this year it recorded $3 billion shipping such key steel products as H beams, steel rods, hot roll plates, among others, despite the sluggish global economy to China, and countries in Southeast Asia and other newly emerging markets as the company continuous explore new markets for its steel products.
Hyundai Steel's expanded capacity has reduced the importation of foreign steel plates and has given the shipbuilder and automakers within the group an edge over foreign rivals by using domestic steel plates for building new ships and cars at lower prices.
Korea imported 28.94 million tons of foreign steel products in 2008 and 20.06 million tons in the following year. Of the $27.7 billion in trade gap with Japan, $6.4 billion was for imports of Japanese steel products, including semi-finished steel products, high-grade steel slabs, and hot-coil steel, by shipbuilders and automakers in Korea. This is due to a shortfall in the domestic production of crude steel produced from blast furnaces.
Hyundai Steel projected that its new blast furnace will be able to replace $8 billion worth of steel product imports annually. Hyundai Motor needs 1.3 million tons of steel plates annually and it will increase to 2.3 million tons from 2013, boosting synergy among Hyundai Motor affiliates.
The Dangjin integrated steel mill, the predecessor of Hyundai Steel, was set up initially to produce high-grade steel products for the production of cars. The synergy created by Hyundai Steel and Hyundai Hysco, which produces cold-rolled steel, continues to be watched keenly as they supply their products to both Hyundai Motor and Kia Motors.
These three affiliates have been creating synergy with the Hyundai Steel Research Institute at its core from the beginning. They jointly developed a B pillar that protects passengers in crashes, and from next year, they will use steel products from Hyundai Steel, saving 40 billion won in import substitution annually.
The research institute will go further in its research and, jointly with the two car makers, will try to improve the quality of about 70 percent of steel plates that go into cars and from 2013 will work to develop super-strong steel plates for cars.
From this year, the steel plant will produce 27 steel products that go into cars, including those used in doors and roofs, and develop 20 highly-functional steel products that go into such parts as hoods and fenders, completing the development of 96 kinds of steel products including steel plates for cars. nw
President Lee Myung-bak shakes hands with Vice Chairman Park Sung-ha of Hyundai Steel after presenting the $3 billion Export Tower during the 48th Trade Day ceremony held at Coex, Seoul, on Dec. 12. Photo on courtesy of KITA