POSCO Vietnam to Enter 1.2MT Full Operation in 2011

POSCO Vietnam, a major cold rolled coil maker in Vietnam and subsidiary of POSCO, aims full operation at 1.2 million tonnes in 2011. Vietnam continues high economic growth compared with other countries in Southeast Asia. Vietnam’s domestic demand for cold rolled sheet is expected to increase by 8-10% in 2011 from 2010. Export is also increasing from Vietnam to ASEAN market, especially to Thailand. Export accounts for more than 50% in POSCO Vietnam’s total sales. The firm aims to increase sales of high grade steel sheet applied to automobile and motorcycle in domestic and overseas market as well as steel structural materials of present main item.

POSCO Vietnam’s sales manager said to Japan Metal Bulletin the firm will enter full production in 2011. The firm constructed cold rolling mill in South Vietnam and started operation in October 2009 with Nippon Steel’s 15% capital investment. The mill has continuous pickled, cold rolling and annealing equipments. The annual output was 100,000 tonnes in 2009 and 940,000 tonnes in 2010 against total capacity at 1.2 million tonnes.

Vietnam’s domestic demand for cold rolled sheet was 1.5 million tonnes in 2010. Supply capacity is much larger than domestic demand despite of demand growth. POSCO Vietnam is increasing export to Thailand, Indonesia, Malaysia and Philippine by utilizing POSCO Group’s local processing centers. POSCO Vietnam purchases hot rolled coil, 50% from South Korea and the rest from other countries such as Japan.

Steel demand is expanding in Vietnam along infrastructure constructions and overseas enterprises’ activities. The demand for cold rolling sheet is expected to reach 2.1 million tonnes in 2015 and 2.7 million tonnes in 2020. POSCO Vietnam can raise output to max 1.5 million tonnes by productivity enhancement of existent facilities.