On December 7, employees celebrated reaching 20 million tons and took a commemorative photo.

FINEX is an innovative, paradigm-shifting technology where molten iron is produced directly in a blast furnace. The process eliminates preliminary processing and uses cheaper powder-type iron ore and bituminous coal as raw materials. Subsequently, investment and production costs can be reduced by 85 percent compared to those of general blast furnaces of the same size. In addition, the technology reduces SOx and NOx emissions by 40 and 15 percent respectively, and fine dust particles can be reduced by 34 percent compared to general blast furnaces.

The beginnings of the technology date back to the 1990s when the Korean government chose POSCO’s smelting reduction steelmaking for a national project and contributed KRW 22.2 billion for research and development.

As a result, POSCO started operating the FINEX 2 plant with an annual production capacity of 1.5 million tons in 2007, and the FINEX 3 plant with an annual production capacity of 2 million tons in 2014, which now produces 10,000 tons of molten iron every day. Surprisingly, the Korean steel industry, which was heavily reliant on foreign technologies in 1968, now leads the world’s steel industry in terms of technology.

However, the path to success was filled with challenges.

In 1998, objections were raised against additional investment for the FINEX technology because there were no clear, tangible results even after KRW 60 billion was invested. Even so, POSCO management made a decision to construct a demo-plant with an additional investment of KRW 100 billion for technology development in order to secure long-term competitiveness rather than seeking immediate profit.   

In addition, POSCO convinced steelmaker Voestalpine, who was in possession of the world’s leading technology for molten iron production, to participate in the project as a partner. POSCO was able to do this by offering to cover the full cost of dispatched researchers and engineers should the technology become successful.

In 2003, there was a slight setback when the newly-opened core FINEX processing facility failed to operate successfully. However, after dozens of tests with 80 in-house professionals over 3 months, the facility was up and running.

Molten iron is produced directly in a furnace in the FINEX plant.

Sang-ho Lee, Director in Charge of Commercialization at POIST, said, “With less than 50 years of steelmaking experience, POSCO has managed to achieve a next-generation, innovative steel-producing technology. It feels great because even though POSCO started as a fast follower of foreign technologies, we are now a leading company in the world’s steel industry with our FINEX technology.”

POSCO currently has over 200 patents for its FINEX technology and HCI technology in Korea and 50 patents in more than 20 countries worldwide. Many overseas companies have expressed an interest in FINEX, and POSCO is in talks with world-renowned steelmakers in China to export its FINEX technology.

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POSCO has many modifiers that follow us, one of it being given by WSD. On February 1st, POSCO has been named “The World’s Most Competitive Steelmaker” by the World Steel Dynamics(WSD), which is a strategic information service providing critical and new perspectives on possible and probable steel industry developments, for 4 years in a row.

Thirty-four steel industries, including POSCO, were judged on basis of their production scale, profitability, innovative technology, reduction of production cost, financial soundness, ability to secure raw materials and 23 additional measures.

POSCO impressed the world with our high level of workmanship, production capacity. Products like Finex, POIST, CEM proved the cutting-edge, leading innovative technology we’ve created and pursued, which also helped increase the competitiveness of raw materials. On sections like profitability, reduction of production costs and expansion into new markets, POSCO scored 7.76 points out of 10, as to be one of the top ranked companies.

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FINEX: POSCO’s own eco-friendly iron making technology that allows the direct use of cheap iron ore fines and non-coking coal as feedback. Having significantly lower operating costs and emissions, Finex dramatically reduces overall construction costs.

POIST: POSCO’s Innovation Steel Technology is POSCO’s own leading-edge refining technology of molten metal for protection of profitability and environment simultaneously.

CEM: Compact Endless Casting and Rolling Mill that have compacted steelmaking, steel performance, and rolling process.

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What’s interesting about this year’s results is that the entire steel industry experienced a down-turn over the years, yet POSCO managed to receive an even better score of 7.48 points that we did the previous years. The gap between POSCO and companies who scored below 7.3 became huge as well.

Following POSCO as 1st place are, Russia’s NLMK placed 2nd, Severstal 3rd and India’s JSW Steel as the 4th place. Companies who were named “The World’s Most Competitive Steelmaker” all possessed self-functioning/ owned steel mines, enabling the competitive supply of base materials. In addition, with the technologies such as solar synergy and enzer, Nippon Steel and Sumitomo Metal became 5th place. Arcelormittal, though it was 1st place in steel production level, scored as 22nd place.

As evident as it is by now, POSCO is currently the 1st place in “The World’s Most Competitive Steelmaker,” for 4 years in a row today. But actually, we have achieved this title during 2002 to 2004 also. We rented the place to other large corporations briefly, namely to Severstal and Tata Steel. Nonetheless, POSCO was able to take the title back since 2010 due to our continuous efforts in reducing production costs, improving profitability, increasing technological researches, and pioneering for new markets. We hope to continue this happy trail and work harder to further develop our skills for the betterment of not just POSCO but the world that we coexist.

< WSD’s World-Class  Steelmaker Rankings as of January 2013>