Hyundai inked coking-coal supply agreement with Russia to satisfy blast furnace demand

Sep. 25 MetalBiz--S. Korea's Hyundai on September 23 stated that it had signed the supply agreement memorandum of understanding with Russia Siberia Anthracite Coal, with 5 years of expiration to meet with the raw material demand from the increasing steel production.

It is reported that POSCO also inked that 5-year supply agreement with another Siberia coal plant, Sibuglemet on September 23, buying 1mln tons of coking coal and coal products from Sibuglemet since 2010.

So far, Hyundai noted that it had signed the similar coking coal supply agreement with Australia's BHP Billiton, Rio Tinto and Wesfarmers as well as Canada's EVCC. In addition, Russia's largest coking coal supplier, Lyabinsk Iron and Steel Company in February promised to provide 300,000 tons of coking coal per year for Hyundai.

To ensure to satisfy the demand from rising capacity, Hyundai is hurry off to ink the long-term supply agreement with overseas iron ore and coking coal suppliers. No. 1 and No. 2 blast furnace with 4mln tons of capacity building had completed over 80%, and it is expected to be operated in January, 2010. In that time, Hyundai will become the strong competitor of POSCO, and the steel output will hike by 60%, producing auto steel-board and ship board. At present, the company produces electric furnace steel, with 11mln tons of production per year.

It is learned that No.1 and No.2 blast furnace's per-year iron ore and coking coal demand is 13.6mln tons and 6.5mln tons. After No.1 and No. 2 blast furnace stabilize the production in 2012, the company also plans to build up No.3 blast furnace, and in the future iron ore and coking coal demand will further pick up.