By Kim Hyun-cheol
Staff Reporter
POSCO, the nation's No. 1 steel maker, has completed the construction of a plant in Vietnam, the biggest in Southeast Asia.
The $528-million factory, seated in a 158-hectare site at the Phu My industrial complex in Vung Tau Province, will produce 1.2 million metric tons of high-quality cold-rolled plates and strips which are used in the production of cars and construction materials, POSCO said Monday. Construction of the facility started in August 2007.
The company has set up a solid belt of steel and iron production and sales sites that links Korea and Southeast Asia, according to POSCO. With hot-rolled materials supplied from POSCO's Pohang and Gwangyang mills, products at the Phu My factory will be exported to the Asian region through processing facilities in countries including Vietnam, Thailand and Indonesia.
POSCO expects its construction will contribute to upgrading its status in the rapidly growing market in the region.
``The market has long been dominated by Japanese players, but it is expected to incline to the Korean side if the new plant successfully meets the local needs for high-quality cold-rolled products,'' a POSCO spokesman said.
In its upcoming plan to snatch the upper hand in the market, POSCO aims to build a couple of new factories in Vietnam after 2012, including a hot-rolled steel mill with an annual capacity of 3 million tons and a 400,000-ton continuous galvanizing line.
Southeast Asia is currently the biggest importer of steel and iron products, as local production capacity is far behind the ever-growing demand in the region.
Since 2000, Vietnam has been maintaining a growth rate of over 7 percent annually, outnumbering other countries in the ASEAN community. The steel industry has surged with annual growth of over 20 percent since the middle of the 1990s.
Steel and iron production, however, is not meeting overall need.
Vietnam's demand for steel is forecast to reach 26.1 million tons in 2020, with the need for high-grade cold-rolled plates reaching 1.5 million tons 2015. But as of last year the country produced only 730,000 tons.
Participants in the completion ceremony expect the plant to play its role to the fullest for the benefit of both countries.
``The facility, as a bridge of the economic cooperation between Korea and Vietnam, will successfully meet the demand in the Southeast Asian market,'' POSCO CEO Chung Joon-yang said.
Vietnamese Industry and Trade Minister Vu Huy Hoang, in response, said the country deeply appreciates POSCO's selection of Vietnam as its overseas production base, and the plant will contribute to the development of various industries there, not to mention the steel industry.