Korea Iron & Steel Association forecasts that the amount of steel produced in the country in 2011 will reach a record high 70 million tonnes.
In a recent report on market changes and steel supply and demand for 2011, KOSA said it that expects the country's steel production will increase by 5.8% YoY from this year's estimated output of 65.35 million tonnes.
The production will be mostly attributed to rising demand in every steel consuming sector, save the construction industry, and improved productivity from new facilities.
Despite the sluggish construction industry, growth in the manufacturing industry is expected to push the amount of steel consumed in the country to 53.92 million tonnes for the year.
According to the report, the amount of steel to be exported will grow by 4.4% to 25.8 million tonnes during the same period, despite a sputtering global economy, boosted by rapid growth in emerging economies including India, as well as the expansion of the industry's overseas supply chain.
South Korea's steel imports in 2011, on the other hand, are expected to decrease by 11.9% YoY to 22.02 million tonnes. The decrease will be due mainly to an increase in steel supply from local steelmakers, caused by improved overall production capacity, with some of the companies having opened or planning to open new production facilities.
The year's crude steel production is expected to reach 64.31 million tonnes a year, up by 11% YoY, with more furnaces both converter and electric in operation with improved processing capacity. It will be the first time the figure reaches the 60 million tonne mark, four years after it surpassed the 50 million tonne mark in 2007.
KOSA also projected that the amount of crude steel produced by converter will rise by 17.7% to 39.65 million tonnes, as both POSCO and Hyundai Steel recently launched new converter. Electric arc furnaces, on the other hand, will produce about 24.66 million tonnes of crude steel in 2011, up by 1.7% YoY. The amount will account for over 60% of the country's crude steel production.
By product, steel plate production in 2011 is predicted to reach 10.57 million tonnes, thanks to new production facilities launched over the past two years. The figure has never reached the 10 million tonne mark. About 33.51 million tonnes of hot rolled coil excluding stainless steel are expected to be produced, surpassing the 30 million tonne mark for the first time. The growth in the hot rolled coil production will be caused mainly by increased production capacity at major steelmakers.
Mr Oh Il hwan VC of KOSA said in the report that "The country's overall steel production is expected to grow by 3% to 5% in 2011. But we also need to prepare a measure to stabilize the market, such as encouraging local steel companies to collaborate with each other, as the growing production capacity of the steel industry will create a lot of competition among local players, amid decreasing demand."
