South Korea’s Posco Stainless Steel Production Fell Down

South Korea’s Posco Stainless Steel Production Fell Down
Recently, South Korea’s Posco Steel (POSCO) released a report showing that in the second quarter of 2019, its stainless steel output was 466,000 tons, down about 6.4% from the previous quarter’s 498,000 tons and about 12.7 from the previous year’s 534,000 tons. Its stainless steel sales volume was 448,000 tons, down by about 11.5% and 15.2% from the previous season’s 506,000 tons and 528,000 tons in the same period of last year. The average price of stainless steel increased by 99,000 won/ton.
In the same quarter, its crude steel output increased by 9.44 million tons compared with the previous month, while steel production decreased to 8.855 million tons due to production line maintenance. Steel sales volume was 8.746 million tons, of which sales to both domestic and foreign markets both decreased.The world’s top quality products (WTP) accounted for a year-on-year decline and the chain fell to 29.6%. Its sales fell to 7.476 trillion won in the same period. Despite the selling price of carbon steel, stainless steel increased due to the depreciation of the Korean won, its operating profit fell to 724 billion won as a result of the decline in sales volume and raw material prices, and its operating profit margin also fell to 9.7% from the previous month. Its net profit fell to 545 billion from the previous month. In South Korea, the net profit margin fell to 7.3% from the previous month.
South Korea’s Posco’s second quarter of 2019 stainless steel production has a downward trend compared with the first quarter and the same period of 2018, while downstream demand is also decreasing in the second quarter, but its crude steel output is increasing. In response to this situation, South Korea’s Posco Steel’s import demand for electrolytic manganese can be expected to increase production.The total amount of South Korea’s Posco Electrolytic Manganese in the second quarter of 2019 was 12,290 tons increasing by 3,740 tons compared with the first quarter (8550 tons). Therefore, this increase also shows that the steel mill has an increasing trend for production. However, due to the lack of actual demand for steel in the downstream, the price support is weak, so there will be a slight decline for the output and profit.The specific output of stainless steel in the later period needs to continue to wait and see the actual demand performance of the market.