MB ASIAN STAINLESS STEEL: Posco VST to ramp up capacity to 235,000 tpy by August

Posco VST, a stainless steel subsidiary of Posco’s in Vietnam, plans to achieve its full cold rolled coil capacity of 235,000 tpy by August, a senior official at the unit told Metal Bulletin.

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“Our new 150,000 tpy plant only finished construction in March,” Yeon Kyung Heum, gm of Posco VST’s export sales department, said on the sidelines of the 7th Asian Stainless Steel conference in Singapore on Wednesday June 27.

The plant is operating at about 60% of capacity at the moment as it aims to reach full production by August.

Posco bought a 96% stake in Asian Stainless Corp (ASC), a local 30,000 tpy stainless steel cold rolled coil mill located within the Nhon Trach industrial complex near Ho Chi Minh City, in October 2009.

Posco then renamed it Posco VST, and raised its stainless steel capacity to 85,000 tpy through a facility expansion.

The company further expanded its capacity, by setting up within the same complex the 150,000 tpy cold rolled coil plant that was completed in March 2012.

Posco VST sells 60% of its products to the domestic market in Vietnam.

The remaining 40% is exported to Southeast Asia and Europe.

A further expansion has been planned to increase Posco VST’s capacity to 285,000 tpy by 2015.

The expansion is undertaken based on projections that demand for stainless steel cold rolled products in Vietnam will increase from the current 250,000 tpy to 330,000 tpy by 2015, Posco said.

Once it achieves its 285,000 tpy capacity, Posco VST will become Southeast Asia`s largest stainless steel cold rolled product producer, alongside the 180,000 tpy Posco Thainox in Thailand, which was officially launched in December 2011, Posco said on its website.

There is only one other stainless steel mill in Vietnam, the 100,000 tpy Inox Hoa Binh, which was completed early this year.

Demand for stainless steel cold rolled products in the Southeast Asian region is forecasted to increase at an average annual rate of 8% from 750,000 tpy in 2012, to hit 950,000 tpy in 2015, Posco said.

Posco controls a 67% market share for Southeast Asia’s cold rolled products through its two plants in the region, as well as its facilities in Pohang in South Korea, and Zhangjiagang and Qingdao in China.

The steelmaker is also building a 200,000 tpy stainless steel cold rolled coil mill in Turkey, which is expected to be commissioned in end-2013.

The stainless steel business makes up 20-25% of Posco’s annual turnover, Yeon said.