It is predicted that due to weak market demand, the domestic domestic production of hot rolled steel will decline this year. In the first half of the year, the domestic production of hot-rolled steel sheets in Korea was 6.048 million tons, a decrease of 4.8% year-on-year.
The main reason for the reduction in production is the large-scale maintenance of related equipment, especially in September and October. Another reason is the recent weakening of demand in the domestic market in Korea. In the second half of this year, in addition to the small rebound in market demand in the construction industry, the consumption prospects of other downstream steel industries are bleak. However, considering the intensification of trade tensions between Japan and South Korea, South Korea may cut imports of hot-rolled steel sheets, cold-rolled steel sheets and pipes from Japan. Therefore, Korean hot-rolled steel sheet producers can appropriately adjust their production plans for the second half of the year to cope with changes in a timely manner. According to data released by the Korea Iron and Steel Association, in the first half of this year, South Korea imported a total of 9,976,900 tons of hot-rolled steel sheets from Japan.
In addition, iron ore prices continue to be bullish, and producers' production cost pressures increase. Although iron ore import prices have recently declined, the current level is still higher than last year's average import price.
