Emergency in Steel Materials Due to Iron Ore Surge... Government and Steel Industry Hold Supply-Demand Monitoring Meeting

Checking Supply and Demand Trends by Product such as Rebar and Heavy Plates

[Image source=Yonhap News]

[Asia Economy Reporter Hwang Yoon-joo] As iron ore prices soar, causing steel product prices to rise sharply, the government and the steel industry are putting their heads together to devise countermeasures. After checking the distribution status of products such as rebar and heavy plates, they plan to listen to the difficulties faced by demand industries and prepare response measures.

According to the government and the steel industry on the 11th, the Ministry of Trade, Industry and Energy will convene a ‘Supply and Demand Trend Inspection Meeting’ at 3 p.m. on the same day, gathering Korea Iron & Steel Association member companies such as POSCO and Hyundai Steel. The meeting, held in the conference room at Seoul Station, will be attended by policy officials from the Ministry, Byun Young-man, the full-time vice chairman of the Steel Association, and marketing managers from steel companies, who will exchange opinions on the supply and demand status and outlook for each steel product item.

A Steel Association official said, "This is a meeting to check the recent tight supply and demand of steel materials and discuss whether there are any measures to resolve supply instability," adding, "We plan to first check the distribution status of products such as rebar and heavy plates." On the 13th, they will meet with demand industry groups such as machinery, shipbuilding, and equipment to hear their difficulties.

As iron ore prices continue to surge recently, prices of most products, including hot-rolled steel sheets used as basic steel materials for automobiles and home appliances, cold-rolled steel sheets, and heavy plates used in shipbuilding, are soaring. Steelmakers are partially reflecting the rising raw material prices in their products, but small and medium-sized enterprises in demand industries find it difficult to reflect steel price increases in their delivery prices. This background also explains why a post urging countermeasures appeared on the national petition board, stating, "The price of steel raw materials is rising absurdly. If this continues, there seems to be no hope for the steel industry manufacturing sector."

The problem is that it is difficult for the government to come up with sharp countermeasures. Since the surge in iron ore and steel prices is a global phenomenon, the government cannot control prices.

Accordingly, the Ministry of Trade, Industry and Energy reportedly ordered steelmakers to "supply sufficient quantities to the market." However, steelmakers such as POSCO and Hyundai Steel are already operating their production lines at full capacity. It is also known that some export volumes are being redirected to domestic supply.

A steel industry official said, "Since companies did not sufficiently prepare steel inventories after COVID-19 and demand surged rapidly, supply instability occurred," adding, "Steel mills are also reviewing ways to increase production lines by operating at full capacity and adjusting blast furnace maintenance schedules, but there are limits due to safety concerns."

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