South Korea: POSCO crude steel output up 6% in CY'21 on strong demand

South Korean steel giant POSCO released its CY'21 results on 28 Jan'22. The company's annual crude steel output and steel sales volumes increased y-o-y in the fiscal year ended Dec'21.

Highlights:

• Crude steel output: Production volumes in Jan-Dec'21 rose by 6.4% to 38.26 million tonnes (mnt) compared to 35.93 mnt in CY'20. The output increased on the back of strong demand recovery post-the Covid-19 pandemic.
  
  

The company ramped up capacity utilisation to 94% in CY'21 to meet the increased demand as against 88% in the previous year.

• Steel sales: Steel products sales increased by 3.4% y-o-y to 35.45 mnt in CY'21 compared to 34.27 mnt in Jan-Dec'20. As the market rebounded, the domestic sales ratio jumped to 59% against 55% in the previous year.
  
  
• Revenue: The company's revenue rose sharply y-o-y to KRW 39.92 trillion ($33 billion) in CY'21 from KRW 26.51 tn ($22 bn) in the previous year.
  
  

POSCO Maharashtra's performance

POSCO's Maharastra-based unit recorded revenue at $1.46 bn in Jan-Dec'21, a surge of 96% y-o-y compared to $748 mn in Jan-Dec'20.

Operating profit jumped, reaching its highest level as prices soared by 53% supported by the strong market sentiments and sales of high-end products such as auto sheets.

The water treatment plant (WTP) sales volume stood at 166,000 t, increasing by 36% y-o-y.

CY'22 forecast and plans

• On production and sales: POSCO expects to achieve crude steel output at 36.5 mnt in CY'22. The company targets to achieve 34.7 mnt of steel sales this year.
  
  
• On cleaner technologies: In cooperation with RoyHill, POSCO will pursue hydrogen production project for green HBI production of 150,000 t/year. It will also review hydrogen project for local DRI production, in line with integrated mill cooperation in India.
  
  
• On raw material prices: Iron ore prices are likely to stay weak till Q3'22 as Chinese demand slows down and global supply rises. Coking coal pricing will stay strong in Q1'22 due to cyclones in Australia, and will stabilise downwards after Q2 as supply rises.