POSCO, HBIS Group Started Construction of Joint Venture Steel Sheet Plant

SEATTLE (Scrap Monster): The joint venture between South Korean steelmaker POSCO and Chinese steel producer HBIS Group started construction of the proposed joint venture steel sheet plant in Heibi, China. The plant is being constructed at an investment of $647 million, further to agreement reached during June last year.

The statement released by HBIS Group noted that the joint venture project is equally split between the two steel giants. It involves construction of two production lines in the steel hub of northern Heibi province and an existing line in Guangdong. The steel plates produced at the plant will be supplied to automobile manufacturers including Toyota, Honda, Nissan, Hyundai, BMW and Volkswagen.

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The expected commencement of production at the plant in 2023 will lift the total plant capacity to 1.35 million tonnes. The capacity is inclusive of the 450,000 tons of the existing Guangdong CGL plant and the proposed 900,000 tons of the two new production lines.

The joint venture seeks to establish a stable supply chain for automotive steel plates in China. The completion of the project will make it the largest single-scale high-end auto sheet supplier in the country, noted Yu Yong, Chairman, HBIS Group.

Incidentally, China accounted for nearly 32% of the world’s automobile production last year. The demand for automotive steel sheets is expected to witness boom in the country.