On April 22, POSCO held a groundbreaking ceremony for a non-oriented electrical steel sheet plant with an annual capacity of 300,000 tons in Gwangyang Works
Hag-dong Kim, Vice Chairman & POSCO CEO said, “We will solidify our position as a global supplier that leads the eco-friendly vehicle and high-end home appliance markets by establishing a production system for non-oriented electrical steel sheets”
he production capacity of high-efficiency non-oriented electrical steel sheets will be increased from 100,000 tons to 400,000 tons a year by 2025.
In order to actively respond to the rapid growth of the eco-friendly vehicle market and demands for energy improved efficiency in home appliance products, POSCO started the construction of non-oriented electrical steel sheet* plant in Gwangyang Works with an annual production capacity of 300,000 tons.
* Electrical steel sheet : A steel sheet that contains 1~5% silicon (Si) that is used as an iron core material for motors, generators, etc., due to its excellent electromagnetic properties and low power loss. Electric steel sheets are largely divided into non-oriented and oriented electrical steel based on their electromagnetic properties. “Non-oriented electrical steel sheets(NO)” have uniform magnetic properties in all directions and are used for rotary drive motors, and “oriented electrical steel sheets(GO)” are mainly used in stationary transformers.
The groundbreaking ceremony held at Gwangyang Works was attended by Hag-dong Kim, Vice Chairman & POSCO CEO, Kyung-ho Kim, Deputy Mayor of Gwangyang, Jin-man Park, Head of the Jeonnam Branch of the Korea Industrial Complex Corporation, and representatives and executives of customer companies and others such as Hyundai Motor Group, Samsung Electronics and LG Electronics.
“Today we are celebrating a new start by extending the production of electrical steel sheets, which were only produced in Pohang Works, to Gwangyang. With this investment, POSCO will solidify its position of a global supplier that leads the eco-friendly vehicle and high-end home appliances markets by establishing production system for the world’s best non-oriented electrical steel sheets in both Pohang and Gwangyang,” said Hag-dong Kim, Vice Chairman & POSCO CEO. “POSCO has achieved remarkable qualitative and quantitative growth, such as being selected as the most competitive steelworks in the world for 12 years in a row. However, in order to continue to grow in today’s rapidly changing business environment, we should respond preemptively to the needs of customers and accelerate the development of products and solutions that will lead the high value-added market,” he added.
Along with the emergence of carbon neutral as a new world order and increasing social interest in the environment, the demand for electrical steel sheets that can improve the energy efficiency of electronic devices is continuously increasing in domestic and overseas markets. In particular, demand for non-oriented electrical steel sheets, which is material for the drive motors of eco-friendly vehicles, is rapidly increasing.
According to IHS Markit, a global market research firm, demand for non-oriented electrical steel sheets for eco-friendly vehicles is expected to increase by 20% annually, from 320,000 tons in 2020 to 4 million tons in 2033. The firm analyzed that demand will outstrip supply from 2025, causing a shortage about 927,000 tons from 2030.
In November 2021, the POSCO Board of Directors decided to establish the non-oriented electrical steel sheet plant by investing about KRW 1 trillion to preemptively respond to the eco-friendly future materials market.
Currently, POSCO has an annual electrical steel sheet production capacity of 830,000 tons including 100,000 tons of high-efficiency non-oriented electrical steel sheets and will secure a total capacity of 1.13 million tons including 400,000 tons of high-efficiency non-oriented electrical steel sheets when construction is completed in 2025.
POSCO will respond to the various needs of customers by reducing the thickness of electrical steel sheets by 0.1 mm and increasing width with the latest facilities that will be introduced and operational know-how that has been accumulated for more than 40 years since the first production of electrical steel sheet in 1979. In addition, about 210,000 construction workers are expected to participate in the construction, contributing to job creation and revitalization of the local economy in Gwangyang.
POSCO will continue large-scale investment and technical development to accelerate the transfer to an eco-friendly and low-carbon production system, and plans to become a steel company with top-notch product competitiveness by pursuing three strategic brand-based sales strategies: new mobility (e Autopos), premium steel (INNOVILT), and green energy (Greenable).