POSCO to Build No.4 Hot Strip Mill at Gwangyang

POSCO announced the board on Friday decided to build No.4 hot strip mill with annual 3.3 million tonnes of output capacity at Gwangyang works for 1.6 trillion won. The construction starts in September 2011 completing in January 2014. The firm also expands the steel slab making capacity at Gwangyang to meet the higher hot rolling mill capacity. The firm makes high valued steel products including automotive flat steel at the mill to supply at home and abroad. The firm tries to follow growing demand by expanding the rolling capacity along with the strategy to expand the raw steel output capacity to 23 million tonnes at Gwangyang and to more than 40 million tonnes for domestic total by 2018.

The firm makes mainly high valued steel products at the new mill when the demand grows for automotive flat steel, oil transport steel pipe, high strength steel and wide flat steel products. The firm supplies the additional hot coil to domestic cold rolling makers and southwestern Asian buyers and subsidiaries including the cold rolling company in India.

POSCO has total annual 23.54 million tonnes of hot rolling capacity including around 16 million tonnes for 3 hot strip mills and an electric furnace steel based high mill at Gwangyang and around 8 million tonnes for 2 hot strip mills for carbon steel at Pohang works. With the new mill, the total output capacity reaches 26.84 million tonnes.

The firm launched new steel making shop with around 2 million tonnes per year of output capacity in July to make additional slab for new plate mill at the world largest Gwangyang works with 5 blast furnaces and annual 20 million tonnes of output capacity. The new steel making shop with 300 tonnes converter and slab caster can be added one more line for converter and caster to expand the steel making capacity for new hot strip mill.

POSCO expects the additional hot coil making capacity can contribute to import substitution especially with high grade hot coil from Japan. POSCO tries to have additional hot coil supply ability to supply more hot band to cold rolling plants in Vietnam and India and the firm tries to follow growing demand in Asia when South Korea will keep importing hot coil in and after 2015.