South Korea’s February Steel Output Falls 25% on Demand Slump

By Sungwoo Park

March 19 (Bloomberg) -- South Korea, Asia’s fourth-biggest steelmaking nation, produced 25 percent less crude steel in February as the economic slowdown cut demand from automakers and builders.

Production declined to 3.15 million metric tons last month from 4.2 million tons a year earlier, according to data from the Korea Iron and Steel Association e-mailed today to Bloomberg.

Posco, the country’s biggest producer, slashed production in December for the first time in its 40-year history, joining moves by bigger rivals ArcelorMittal and Nippon Steel Corp. as the global recession crimped demand. The South Korean steelmaker, also Asia’s third-biggest, last month said it will cut output by as much as 800,000 tons between January and March.

The North Asian nation, the biggest steel importer in the region, bought 1.24 million tons of steel products in February, down 49 percent from a year ago, the data showed. Exports fell 17 percent to 1.37 million tons in the same month.

High inventories and rising import costs due to the weaker South Korean won discouraged imports, said Kim Sung Woo, general manager at the association’s international department.

The won fell 28 percent against the U.S. dollar in the past year as the worst-performing currency in Asia.

Other South Korean steelmakers include Hyundai Steel Co. and Dongkuk Steel Mill Co.

To contact the reporter on this story: Sungwoo Park in Seoul at spark47@bloomberg.net.