POSCO to Establish Subsidiary for Integrated Logistics Operations

[Asia Economy Reporter Hwang Yoon-joo] POSCO is pursuing a plan to integrate the dispersed logistics operations within the group.

On the 7th, POSCO announced that it is considering operating a subsidiary dedicated to logistics operations within the group to more efficiently support its existing businesses.

Since early this year, POSCO has formed a task force (TF) to discuss the establishment of a logistics subsidiary. Until now, each affiliate such as POSCO International and POSCO Terminal has conducted iron ore imports and steel product exports through one-on-one contracts with shipping companies, but after establishing the subsidiary, it plans to take charge of raw material transportation and logistics operations.

The plan to integrate logistics operations within the POSCO Group involves consolidating logistics functions, organizations, and personnel from each group company into one and unifying contract management functions.

The shipping industry is opposing POSCO's entry into the logistics business. This is because POSCO is a mega shipper importing 80 million tons of steelmaking raw materials annually and exporting 20 million tons of steel products. It is known that the annual logistics cost alone reaches 6 trillion won.

The Korea Maritime Industry Federation (Hanhaechong) pointed out, "POSCO's logistics subsidiary is likely to collect toll fees from shipping companies and pressure them to reduce freight rates." On the same day, Hanhaechong also delivered a petition to POSCO requesting the withdrawal of the plan to establish the logistics subsidiary.

POSCO stated that it has no plans to enter the shipping or transportation business regarding the establishment of the logistics subsidiary.

This content was produced with the assistance of AI translation services.