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POSCO

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For other uses, seePOSCO (disambiguation).
POSCO
Native name
포항종합제철 주식회사
(Until 2002)
주식회사 포스코
(Since 2002)
Revised RomanizationPohang Jonghap Jecheol Jusikhoesa
(Until 2002)
Jusikhoesa Poseuko
(Since 2002)
Company typePublic
KRX:005490
NYSE:PKX
(POSCO Holdings Inc.)
IndustrySteel
Industrial manufacturing
FoundedApril 1968;56 years ago(1968-04)
FounderPark Tae-Joon
HeadquartersPohang,South Korea
Area served
Worldwide
Key people
Choi Jeong-Woo
(Chief Executive Officer)
ProductsSteel, flat steel products, long steel products,wire products,plates
RevenueIncreaseKRW75.16 trillion(2021)[1]
IncreaseKRW9.25 trillion(2021)[1]
IncreaseKRW7.22 trillion(2021)[1]
Total assetsIncreaseKRW79.08 trillion(2020)[1]
Total equityIncreaseKRW47.68 trillion(2020)[1]
OwnerNational Pension Service(6.38%)
Number of employees
29,648 (2009)
SubsidiariesPOSCO International

POSCO Chemical

POSCO E&C
Websitewww.posco.co.kr

POSCO(formerlyPohang Iron and Steel Company) is a South Korean steel manufacturer headquartered inPohang,South Korea.It had an output of 42,000,000 metric tons (41,000,000 long tons; 46,000,000 short tons) of crude steel in 2015, making it theworld's sixth-largest steelmaker by this measure.[2]In 2010, it was the world's largest steel manufacturing company by market value.[3]Also, in 2012, it was named as the world's 146th-largest corporation by theFortune Global 500.[4]

POSCO currently operates two integratedsteel millsin South Korea, inPohangandGwangyang.POSCO previously operated ajoint venturewithU.S. Steel,USS-POSCO Industries, inPittsburg, California,United States, but U.S. Steel acquired full ownership of the facility in February 2020.

History

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1968–1971

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In the 1960s, South Korean administration concluded thatself-sufficiencyin steel and the construction of an integrated steelworks were essential to economic development.[5]Since South Korea had not possessed a modernsteel plantprior to 1968,[6]many foreign and domestic businesses were skeptical ofRepublic of Korea Government'sdecision to invest so heavily in developing its own industry.[5]The Korean government created Pohang Iron and Steel Company, Ltd (POSCO) in 1968 and appointed as president of the mill a competent retired army general and friend of PresidentPark Chung Hee,Park Tae-joon,a man with a track record of having turned around the government-ownedKorea Tungsten Company.Construction of thePohangplant began on April 1, 1970, and was dedicated on July 3, 1973, with an initial annual capacity of 1.03 million metric tons.[7]

Japanprovided the money for the construction of the initial plant, following an agreement made at the Third South Korea-Japan Ministerial Meeting in 1969.[8]Financing included US$119 million in governmentgrantsandloans,[9][10]US$54 million increditfrom theExport-Import Bank of Japan,and technical assistance fromNippon Steeland other corporations.[8][11]This cooperation was one consequence of the normalization of relations withJapanin 1965 and reflected the view of the government of Japan as noted in theNixon-Satocommunique of November 21, 1969, that "thenational securityof the Republic of Korea is essential to the security of Japan. "[12]

1972–1992

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POSCO first began to sellplateproducts in 1972 and focused its sales policies on the domestic market to improve steel self-sufficiency at home. It made special efforts to supply qualityironandsteelto related domestic companies at belowexportprice to strengthen their international competitiveness.[citation needed]

Beginning in 1973, South Korea's government used its National Investment Fund and theKorea Development Bankto invest large amounts of money into what Park Chung-hee's government viewed as the six strategic industries: steel, non-ferrous metals, shipbuilding, industrial machinery, electronics, and petrochemicals.[13]: 136 This strategy helped develop companies POSCO and reduced input costs for production in downstream industries as well.[13]: 136 

POSCO produced 6,200,000 t (6,100,000 long tons; 6,800,000 short tons) of raw steel in 1980, recording a 13% increase over the previous year,[citation needed]and was one of the few exceptions when almost all areas of the Korean economy were in economic depression. Domestic industries absorbed POSCO's major products such as automobile and home appliance manufacturers consuminghot rolledproducts,shipbuildingandconstructionandengineeringcompanies consuming medium plates, andelectric motorandtransformermanufacturers consuming electrical sheets. Some over-produced products were exported to foreign countries but the significantimportof sections for construction left Korea as a net importer. Globally, POSCO was already the most efficient steel producer in certain products.[citation needed]

By the late 1980s, POSCO's growth had been immense. It was the fifth biggest steel company in the world, with an annual production approaching 12 million tons worth 3 trillionwon.[citation needed]POSCO continued to expandproductivityand size at a time when the steel industries of theUnited StatesandJapanwere declining. POSCO completed its second-phase mill atGwangyangin August 1988. A third-phase mill completed in 1992 further increased crude steel production to a total output of approximately 17.2 million tons a year.[citation needed]In terms of productivity, POSCO was the world's best steel manufacturer throughout the late 1980s and also was at the top in terms of facilities.[citation needed]

Pohang, previously afishingportwhose major industry was processingfishandmarineproducts, became a major industrial center with almost 520,000 people.[citation needed]In addition to the huge integratedsteel mill,Pohangbecame an industrial complex housing companies that manufacture finished steel products ofraw materialsprovided.

Pohang University of Science and Technology (POSTECH)

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POSCO CEO Park Tae-joon was quoted as saying, "You can import coal and machines, but you cannot import talent".[citation needed]Park realized the need for Korea to educate their youth in science and technology to ensure Korea's position in the high technology arena. Park founded thePohang University of Science and Technology(POSTECH) in 1986 as Korea's first science and technology research-oriented university with the mission to educate young Koreans who can contribute to national prosperity through the advancement in science and technology. In 2012 and 2013, theTimes Higher Educationranked POSTECH 1st in their "100 Under 50 Young Universities" rankings.[14]

1992–1997

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Changes in managerial systems andorganizational structureaccelerated in 1993 when POSCO'spresidentand founder, Park Tae-Joon, who had wielded absolute managerial authority for more than 25 years, resigned.

With the change in leadership—from Park Tae-Joon to Ryu-Sang Bu, POSCO increaseddecentralizationand diversification. POSCO's management emphasized greaterflexibility,autonomy,and consensual decision-making processes. The chairman also moved to devolve moreautonomyto theprofit centersand changing from a strictly hierarchicalorganizational structureto one based on teams.

In July 1994, POSCO created two subsidiary companies, POSTEEL and POSTRADE. POSTEEL is the domestic sales and service arm of the company, while POSTRADE handles international trading of POSCO products. Both subsidiaries commenced full operation in September 1994, with all international POSCO affiliates transferred to POSTRADE by the end of that year. The landmark Posteel Tower onTehran Street,in Seoul'sGangnam district(not to be confused with the POSCO Center, also on Tehran Street) was completed in 2003.

1997–2000

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In 1997, Seoul announced that it was going to transform POSCO into aprivate companyin line with the government's new policy ofprivatizingstate-owned enterprises.The government planned to retain a majority share of thestock;initial reports in the South Korean press in 1998 indicated that the sale ofpublic shareswas going slower than anticipated. However, the administration led byKim Young Samchanged the initial policy direction ofprivatizationof POSCO and decided not to sell government-owned stock to keep it as a government investment enterprise.

But, theKim Dae Jungadministration following theKim Young Samadministration listedprivatizationofpublic enterpriseas a high priority policy ineconomic policyagenda to implement mainly because of outbreak of theeconomic crisis.The new administration decided toprivatizePOSCO and by 1998, the South Korean government had reduced itsownershipofsharesin POSCO to less than 20%, and more than 58% of the shares in POSCO were in the hands offoreign investors.[15]In 2000, fullprivatizationof POSCO was completed.

2001–present

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As part of theprivatizationprocess, new Chairman Lee Ku-Taek began efforts to introduce a professionalmanagementandgovernancesystem of global standards for POSCO. Under the new governance system, management madeaccountabilityto shareholders a priority. POSCO also introduced a new performance-based evaluation and compensation system. Throughout most of itsprivatizationdrive, POSCO increased itsrevenueand businessprofit.Thanks to robustdemandat home and inChina,POSCO recorded the largest profits in the global steel industry in 2004.[citation needed]Netearningsfrom POSCO's array of steel products – used in everything fromscrewstoskyscrapers– shot up 80% to $1.66 billion in 2004 from the previous year.[citation needed]

With increasing global competition, POSCO looked toChinaandIndiafor new opportunities. South Koreanwageswere too high to support a whole range of activities and POSCO looked elsewhere for new projects while keeping the areas where they have acomparative advantageinSouth Korea.By 2006, POSCO had 26subsidiariesand invested over $2.4 billion in freshinvestmentonmainland China,[citation needed]especially ingalvanizedandstainless steelto supply globalautoand appliance makers that have opened plants there. In 2006, POSCO started operating the Zhangjiagang Pohang Stainless Steel (ZPSS)steel millcapable of producing 600,000tonsofstainless steelandhot-rolledproducts annually in China'sJiangsuProvince. As a result, POSCO became the first foreign firm operating an integratedstainless steelmill inChina,handling the entire production process from smeltingiron oreto finished products, including thecold rolledstainless plant it already operates. In June 2022, POSCO is temporarily cutting production lines in Pohang plants as thousands of truckers go on a strike for higher pay, causing disrupted cargo transport in the country.[16]

POSCO in India

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In June 2005, POSCO signed amemorandum of understandingwith theState of OrissainIndia.Under the agreement, POSCO plans to invest US$12 billion to construct a plant with fourblast furnaces,an electricity plant, housing, and an annual production capacity of 12,000,000 metric tons (12,000,000 long tons; 13,000,000 short tons) ofsteel,which is slated to start production in 2010.[citation needed][needs update]The project, which would start with a 3,000,000-metric-ton (3,000,000-long-ton; 3,300,000-short-ton) capacity initially, would fetchrevenuefor the government to the tune ofRs700croreto Rs 800 crore (Rs 7-8 billion) annually. It would also provide direct employment to 13,000 people and ensure indirect employment for another 35,000.[citation needed]TheOdishastate government also promised to provide a total of 600 million tons of iron sources, and will allow POSCO to useiron orefrom these sources over the next 30 years. If the project goes ahead, it will be the single largestforeign direct investmentinIndiaas well as being the world's biggestgreenfieldsteel plant ever.[citation needed]

However, from 2005 till date (as of August 7, 2010), the India project has not been able to proceed due to strong opposition from the local residents in the area proposed to be given for the steel plant. There have been allegations that the federal and State governments have been illegally trying to take lands and forests for the project, in violation of theForest Rights Act.[17]There have also been claims that the project will only benefit the company while displacing more people than it employs, damaging the environment and taking India's mineral resources at a very low price.[18]

Further, a study[19]undertaken by the Mining Zone Peoples' Solidarity Group,[20]an international research group focused on India, finds evidence of irregularities in dealings with state, bureaucracy and judiciary and questions and debunks the social, economic and environmental claims that the project has made.

The MoU between POSCO and State of Odisha expired in 2010. Following allegations that the ministry had not adhered to Forest Rights Act, Ministry of Environment and Forests (MoEF) set up the N.C. Saxena committee in July 2010 to review the clearance. Despite the committee's report indicating that provisions of the Forest Rights Act had been violated, the MoEF issued final order on January 31, 2011, and gave environment clearance toPOSCO. In May 2013, the National Green Tribunal (NGT) halted land acquisition for the POSCO projects. In July 2013, POSCO completed land acquisition despite the order given by NGT. In December 2013, POSCO began construction of a boundary wall around its plant site. In December 2013, the NGT criticised the forest clearance granted by the Union Ministry of Environment and Forests (MoEF) to the proposed steel plant of South Korean steel giant, POSCO, in Odisha.[21]

There have been reports that during protests and land acquisition during Feb - Mar 2013, there has been bombing attack on the resisting villages and naked protest against the police atrocity.[22]

The Central Government of India came out confident on 15 January 2014 that with the renewal of environment clearance, South Korean steel giant POSCO's project in Odisha would take off soon. After a meeting with visiting South Korean Minister of Trade, Industry and Energy Yoon Sang-jick, Mr. Sharma told the media: "So far, 1,700 acres of land — out of 2,718 acres — have been transferred to POSCO and the rest will soon be given." On July 17, 2015, news reported that South Korean steelmaker POSCO may halt a $12 billion US dollar plan agreed with Odisha, India a decade ago due to the delay in regulatory approvals.[23]In 2016, POSCO confirms withNational Green Tribunal(NGT) that it will suspend the steel plant project in Odisha, India.[24]POSCO finally exited from this project on March 18, 2017 (Saturday).

On 13 January 2022, theAdani Groupannounced that it had signed an MoU with POSCO to explore the setting up of an Integrated Steel Mill in Mundra, Gujarat, with an estimated total investment of US$5 billion.[25]

POSCO in other developing countries

[edit]
POSCO Center-Beijing

POSCO have pursuedinvestmentopportunities in otherdeveloping countriessuch asVietnamandMexico.It was announced in August 2006 that POSCO will build a large-scalesteel millin southernVietnam.[citation needed]POSCO plans to build the US$1 billion plant in two phases forhot-rolledby the end of 2012 andcold rolledproducts by the time of December 2009.[26]When completed, the mill is expected to produce three-milliontonsof steel products annually. Posco also plans to build a $250 million plant in the city ofAltamira,Mexico,to produce 400,000 tons of galvanized steel sheet a year forautomakers.[citation needed]Theventurewill be Posco's first wholly owned steel-plate plant inNorth America.Posco beganconstructionin early 2008, and started operations in 2009, producinggalvanizedandgalvannealedsteel.

On June 30, 2006, POSCO completed the construction of its sixth continuous galvanizing line (CGL) at itsGwangyangmill in theSouth Jeolla Province.With this new addition, POSCO becomes the no.2 producer of sheet-steel just behindArcelorMittal.

In early 2007,Warren Buffett'sBerkshire Hathawaypurchased a 4% stake in POSCO.[27]Berkshire sold its share later in 2014.[28]

In February 2013 POSCO signed aMemorandum of Understandingwith Afferro Mining, Inc, with a view to developing iron ore resources inCameroon.[29]

In November 2013, the completion of steel plant construction in Cilegon, Indonesia is scheduled. It is predicted that the annual production capability of this plant will be 3 million tons of molten iron. On July 31, 2012, the moving-in ceremony of 4 large steel structured pillars surrounding integrated steel mill furnace was held.[30]

Operations

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Head Office

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POSCO's Headquarters, along with the POSCO Center, form the 'brain' of the company, overseeing major tasks, such as themanagement,planning,andfinancesof the steelworks atPohangandGwangyang.The construction of POSCOheadquartersat 1 Goedong-dong, Nam-gu,Pohang,was completed on April 1, 1987.

POSCO Center

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Hosts a variety of cultural programs, events, and exhibitions throughout the year.

Pohang and Gwangyang Steelworks

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Posco steel mill in Pohang, Korea

Pohang- Constructed in four phases between April 1970 and February 1981 along Korea's southeast coast, the nation's first integrated steelworks has produced 230 million tons ofpig ironthrough March 2004 - enough to build some 250 millioncompact cars.Crude Steel Production (2008) = 13.6 million tons.[31]

Gwangyang Steelworks

Gwangyang- Constructed in four phases between September 1982 and October 1992 onKorea's southern coast,the nation's second integrated steelworks. Gwangyang focus on manufacturing automotive steel, high-strength structure steel, API line pipe steel, and other strategic product categories. Crude Steel Production (2008) = 17.4 million tons.[31]

Subsidiaries

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Carbon footprint

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POSCO reported TotalCO2e emissions(Direct + Indirect) for 31 December 2020 at 75,650 Kt (-4,614 /-5.7% y-o-y).[35]

POSCO's TotalCO2e emissions(Direct + Indirect) (in kilotonnes)
Dec 2015 Dec 2016 Dec 2017 Dec 2018 Dec 2019 Dec 2020
87,172[36] 85,065[37] 76,741[38] 78,498[39] 80,264[40] 75,650[35]

See also

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References

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  1. ^abcde"Key Statistics".finance.yahoo.Retrieved2011-04-02.
  2. ^"World Steel Association - Top steel-producing companies".Archived fromthe originalon 2016-07-19.Retrieved2016-07-19.
  3. ^"Archived copy"(PDF).Archived fromthe original(PDF)on 2012-06-18.Retrieved2012-05-18.{{cite web}}:CS1 maint: archived copy as title (link)
  4. ^"Global 500 Companies 101-200 - Fortune".CNN.
  5. ^abKim, Chung-yum (2011).From Despair to Hope: Economic Policymaking in Korea 1945-1979.Seoul, Korea:Korea Development Institute.pp. 159–167.ISBN978-89-8063-529-0.
  6. ^Yülek, Murat A; Taylor, Travis K (2011-12-29).Designing Public Procurement Policy in Developing Countries: How to Foster.Springer. p. –150.ISBN9781461414421.Retrieved2017-04-18.
  7. ^Amsden, Alice H (1989).Asia's Next Giant: South Korea and Late Industrialization.Oxford University Press.pp. 293–296.ISBN0-19-505852-6.Retrieved18 July2023.
  8. ^abMatles Savada, Andrea; Shaw, William, eds. (1997).South Korea: A Country Study.DIANE Publishing. p. 150.ISBN978-0788146190.
  9. ^"대일청구권 자금 쓴 기업들, 징용피해 지원은 '나몰라라'"[Companies benefitted by the Japanese loan and grant disregard the victims of conscription].The Hankyoreh.May 30, 2012.
  10. ^청구권자금백서[Claim fund White Paper]. Economic Planning Board. December 20, 1976.
  11. ^"The role of Yen loan for the rapid economic growth of Korea"(PDF).Japan Bank for International Cooperation. July 2004. p. 77.
  12. ^"Sato-Nixon - 1969".Archived fromthe originalon 2013-12-14.Retrieved2014-02-17.
  13. ^abLan, Xiaohuan (2024).How China Works: An Introduction to China's State-led Economic Development.Translated by Topp, Gary.Palgrave Macmillan.doi:10.1007/978-981-97-0080-6.ISBN978-981-97-0079-0.
  14. ^"Young University Rankings 2013 | Times Higher Education (THE)".Times Higher Education. 2015-04-13.Retrieved2017-04-18.
  15. ^"Increasing foreign-owned shares in POSCO raises alarm".18 June 2018.
  16. ^Kim, Cynthia; Yang, Heekyong (2022-06-12)."POSCO to halt some plants as South Korea trucker strike continues".Reuters.Retrieved2022-06-12.
  17. ^"Web page of Campaign for Survival and Dignity on the legal implications of the project".forestrightsact.Archived fromthe originalon 1 August 2010.Retrieved18 April2017.
  18. ^Gopalakrishnan, Shankar (2007-12-24)."Warning Bell: Posco more a curse than a blessing".The Economic Times.Retrieved2017-04-18.
  19. ^"Iron and Steal: The POSCO India Story".Forestrightsact.Archived fromthe originalon 10 March 2012.Retrieved18 April2017.
  20. ^"Mining Zone Peoples' Solidarity Group".Miningzone.org.Retrieved18 April2017.
  21. ^"Green tribunal questions two-stage forest clearance for POSCO".Downtoearth.org.in.Retrieved2017-04-18.
  22. ^"Anti-Posco stir: women protesters strip to demand halt to land acquisition, withdrawal of police force".ndtv.Retrieved18 April2017.
  23. ^"End Of $12 Billion Dream Project? Posco May Scrap Odisha Project After A Decade Of Delays".HuffPost.2015-07-17.Retrieved2021-07-28.
  24. ^SETHI, NITIN (2016-04-09)."Project in Odisha is over, says Posco".Business Standard India.Retrieved2021-07-28.
  25. ^"POSCO and Adani sign MoU for Integrated Steel Mill".ANI News.Retrieved2022-01-13.
  26. ^"Disclosure".Archived fromthe originalon 2013-06-30.Retrieved2013-04-08.
  27. ^"Warren Buffett's Berkshire Owns 4% Stake in POSCO".cnbc.Reuters. 1 March 2007.Retrieved18 April2017.
  28. ^"Posco plummets on Buffett report".joins.April 2015.Retrieved18 April2017.
  29. ^"FE Investegate -Afferro Mining Inc. Announcements - Afferro Mining Inc.: Signing of MOU with POSCO for Development".investegate.co.uk.Retrieved18 April2017.
  30. ^"Press Releases".Archived fromthe originalon 2013-06-30.Retrieved2013-04-08.
  31. ^ab"POSCO".Archived fromthe originalon 2013-02-18.Retrieved2013-04-05.
  32. ^"INOX: POSCO-THAINOX PUBLIC COMPANY LIMITED – Top 10 shareholders".Stock Exchange of Thailand.Retrieved2024-01-25.
  33. ^"POSCO overseas – Asia".POSCO.Archivedfrom the original on 2024-01-25.Retrieved2024-01-25.
  34. ^"About".POSCO-Thainox.Archivedfrom the original on 2021-12-06.
  35. ^ab"POSCO's Sustainability Report for 2020Q4"(PDF).Archived fromthe original(PDF)on September 30, 2021.Alt URL
  36. ^"POSCO's Sustainability Report for 2017Q4"(PDF).Archived fromthe original(PDF)on June 5, 2020.Alt URL
  37. ^"POSCO's Sustainability Report for 2018Q4"(PDF).Archived fromthe original(PDF)on June 5, 2020.Alt URL
  38. ^"POSCO's Sustainability Report for 2020Q4"(PDF).Archived fromthe original(PDF)on September 30, 2021.Alt URL
  39. ^"POSCO's Sustainability Report for 2020Q4"(PDF).Archived fromthe original(PDF)on September 30, 2021.Alt URL
  40. ^"POSCO's Sustainability Report for 2020Q4"(PDF).Archived fromthe original(PDF)on September 30, 2021.Alt URL
[edit]
Wikimedia Commons has media related toPOSCO.
  • POSCO
  • Official POSCO Newsroom
  • Yahoo! Finance page for PKX
  • Yahoo! Finance page for 005490.KS
  • Posco India
  • India environment portal for resources on POSCO
  • History of POSCO 1968-2010
  • Business data for POSCO:
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