South Korea: Scrap inventory soars w-o-w; POSCO in the lead

Steel inventory levels have increased in South Korea, with POSCO leading the surge. This week, the combined scrap inventory of eight steel companies reached 908,000 t, marking a 2% or 18,000 t increase from the previous week. However, the inventory situation varied by region and company.

Except for POSCO, most steel manufacturers have maintained a steady level of inventory. There was a slight increase in warehousing quantity compared to the previous week, while the inventory quantity decreased slightly. This suggested that a certain balance has been achieved between production and supply. Additionally, it may be noted that some steel companies were implementing special purchase incentives, hinting at the possibility of a slight increase in production before the Chuseok holiday.

Region wise scrap inventory status:

Central region
Steel makers in the central region saw a slight decrease in their inventory levels. Hyundai Steel's Incheon Plant saw a slight increase in inventory. Whereas, Dangjin experienced a decrease in inventory, offsetting Incheon's increase, resulting in a consistent inventory level compared to the previous week. Dongkuk Steel and Hwan Steel both witnessed a slight decrease in inventory, roughly 3% lower than the previous week.

Southern region
Apart from POSCO, most steelmakers in the southern region also reported increased inventory levels, with POSCO contributing significantly to this trend. POSCO's scrap inventory surged by 20% compared to the previous week. This increase is likely attributed to efforts to secure inventory ahead of the Chuseok holiday, during which the supply market temporarily halts.

Busan-Gyeongnam region
The rebar steelmakers in the Busan-Gyeongnam region, including Korea Steel, Daehan Steel, and YK Steel, experienced a decrease in inventory. The combined average daily intake of the four rebar steel companies in Busan and Gyeongnam has been around 10,020 t, indicating increased distribution activity leading up to mid-to-late September. Rebar steel makers here either maintained similar inventory levels to Jeonju or experienced slight decreases. Inventory at Hyundai Steel's Pohang plant remained consistent with that in Jeonju and while increasing its inventory less than POSCO, maintained inventory at about 50% more than at the same time last year.

Blast furnace companies were stockpiling inventory ahead of the holidays and October.

Yeongnam region
Inventory levels in the Yeongnam region remained considerably larger compared to the previous year, with the inventory of three companies being 127% higher than the same week last year, though it has slightly decreased from 147% in the previous week. This region still holds more than twice as much inventory as the same time last year.

This article has been published in accordance with an article exchange agreement between SteelDaily and SteelMint.