POSCO and Hyundai Steel Join Hands for ESG Management through Logistics Cooperation

Annual 240,000 Tons of Multimodal Transport, Approximately 3,000 Tons of Carbon Reduction... Plans to Gradually Expand to 600,000 Tons

Expected to Contribute to Regional Economic Revitalization through Win-Win Cooperation with Small and Medium-Sized Shipping and Freight Companies

[Asia Economy Honam Reporting Headquarters, Reporter Heo Seonsik] POSCO and Hyundai Steel announced on the 29th that they will strengthen cooperation in the logistics sector for ESG management, including carbon emission reduction and win-win growth with local small and medium-sized enterprises.

On the 29th, the two companies signed a business agreement to strengthen cooperation in the logistics sector and reduce carbon emissions at the POSCO Center, attended by Kim Kwangsoo, Head of POSCO Logistics Division, and Seo Myungjin, Vice President in charge of Purchasing and Logistics at Hyundai Steel.

At the signing ceremony, Kim Kwangsoo, Head of the Logistics Division, said, “The combined transportation between POSCO and Hyundai Steel is the first coopetition* case in the logistics sector of the steel industry. We hope that by pooling our wisdom to set a good precedent, a cooperative and win-win atmosphere will be created not only in the steel industry but also throughout the regional economy.”

This agreement was reached with the shared intention that the steel industry should cooperate in reducing emissions even in areas not directly related to the production process to achieve the era’s challenge of carbon neutrality.

According to the agreement, the two companies will share coastal shipping infrastructure such as product transport vessels and dedicated piers, and promote combined transportation of approximately 240,000 tons annually on the Gwangyang and Pyeongtaek-Dangjin port routes.

Combined transportation refers to the method of bundling two or more transport shipments into one for joint transport, which is an efficient and eco-friendly transportation method that minimizes empty runs or empty voyages.

Previously, POSCO and Hyundai Steel individually transported 1.3 million tons and 1.8 million tons of coils annually on the Gwangyang, Pyeongtaek, and Dangjin routes, respectively. However, through this combined transportation, each company will transport 120,000 tons annually using the other’s vessels.

As a result, POSCO’s coil shipping line will reduce about 2 voyages per month, and Hyundai Steel’s dedicated vessels will reduce about 1 to 2 voyages per month, which is expected to reduce carbon emissions by approximately 3,000 tons annually?equivalent to planting 540,000 pine trees?and achieve up to 6% logistics cost savings.

Moreover, shipping companies will minimize empty voyages, leading to an expected increase in sales and operating profits by about 3 to 10%. Additionally, new land routes will be added between Dangjin and Pyeongtaek, where maritime transport is not possible, and between Gwangyang and Suncheon, which is expected to increase cargo volume for local freight transport companies as well.

POSCO and Hyundai Steel successfully completed a pilot operation in August and have started full-scale combined transportation this month. They plan to gradually increase the applicable volume from the initially planned 240,000 tons annually to a maximum of 600,000 tons.

Asia Economy Honam Reporting Headquarters, Reporter Heo Seonsik hss79@asiae.co.kr

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