Steel Mill Brings Reality to Hyundai Dream

The Korea Times

The Korea Times

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Steel Mill Brings Reality to Hyundai Dream

Posted : 2010-04-08 18:07

Updated : 2010-04-08 18:07

In left photo, President Lee Myung-bak, third from right, and Hyundai-Kia Chairman Chung Mong-koo, fourth from right, participate in the opening ceremony of Hyundai Steel’s first integrated mill in Dangjin, South Chungcheong Province, Thursday. Guests also include POSCO CEO Chung Joon-yang, fourth from left; Federation of Korean Industries Chairman Cho Suck-rae, fifth from left; Democratic Party Chairman Chung Sye-kyun, sixth from left; and Knowledge Economy Minister Choi Kyung-hwan, second from right. At right is Hyundai Steel’s production facility.

/ Korea Times Photo by Son Yong-suk

Mill Helps Automaker Greatly Reduce Reliance on POSCO

By Kim Hyun-cheol
Staff Reporter

Following three and half years of construction, Hyundai Steel opened full commercial production of its first integrated mill with the nation's largest blast furnaces in Dangjin, South Chungcheong Province, Thursday.

The second-largest Korean steel maker, also an affiliate of Hyundai-Kia Automotive Group, can produce a total of 4 million tons of steel products annually. Once a second furnace is completed next January, the production will double to 8 million tons.

The steel mill has been the dream of Group Chairman Chung Mong-koo, who has been anxious to obtain a steady supply of steel for auto production. So far, it has relied on its biggest Korean competitor POSCO.

The overall capacity of the $5.6 billion mill in the west coast city will be 12 million tons after a third blast furnace is built by 2015.

``Hyundai-Kia has completed the world's first ever integral business structure ranging from molten iron to automobiles,'' Chung said during a speech. ``This will help Hyundai Steel lead an innovative and active change in the global steel and iron industry.''

The integrated mill is a high-end facility. What makes the plant stand out is its state-of-the-art environmentally-friendly technologies, which is why Hyundai calls it a ``green steel mill.'' The steel industry is one of the most environmentally unfriendly industries with its heavy carbon footprint.

Standing 110 meters in height and 17 meters in width, the mill's furnace features various engineering technology and is expected to help the company secure better competitiveness in both quality and price.

President Lee Myung-bak praised Chung's leadership for its innovative quality.

``Chairman Chung is unique in his leadership as he has proved to be bold when others hesitated during a crisis, which explained his company's success.''

The most prominent feature of the new mill is its emission control system, which eliminates the production of scattering dust, the worst pollutant from integrated steel plants.

Its dome-shaped roof, 60 meters in height and 130 meters in diameter, on its processing and storage unit keeps dust from scattering by delivering iron ore and soft coal directly from the port to the mill on airtight conveyer belts.

Hyundai Steel also expects the newest facility to contribute to boosting the local economy by replacing sizeable steel imports with homemade products and creating jobs and business opportunities for small- and medium-sized companies.

South Korea is the world's sixth-largest steel maker, but still imports 20 million tons of steel products each year. In 2008, the country imported 28.9 million tons of steel.

The furnaces are expected to replace $8 billion worth of steel imports annually, Hyundai Steel said.

This year, Hyundai Steel looks to reach 9.2 trillion won in sales this year, up 15.3 percent from 2009, and sell 12.1 million tons of steel products, in a 22.3-percent growth year-on-year.

According to Hyundai officials, the Dangjin mill will also create some 170,000 jobs in construction and operation, the company forecast. After the second furnace is completed next year, it is expected to lead to sales of more than 1.7 trillion won for related local small- and medium-sized firms.

hckim@koreatimes.co.kr