Steelmaker gets secure source of Brazilian ore
Park Seung-Ha (front right), the president of Hyundai Steel Co., and Jose Martins (front left), the head of Compahia Vale Rio Doce, shake hands at the signing ceremony on May 10 to celebrate a contract for CVRD to provide iron ore to Hyundai Steel for the 10 years beginning 2010. Provided by the company
Under the deal, Hyundai Steel will buy more than 4 million tons of iron ore annually from the world’s biggest iron ore producer.
The purchases will begin in 2010 and continue for 10 years, the company said in an e-mailed statement. The two companies had signed a non-binding agreement last year.
“This long-term supply contract can be favorable for Hyundai Steel, as it has secured a stable supply source,” said Yang Ki-in, an analyst at Daewoo Securities Co.
The iron ore will be for the Korean company’s furnace that is currently under construction.
Hyundai Steel’s new mill, once its construction is completed by 2011, will have an annual output capacity of 8 million tons, and will help Hyundai Steel become the world’s sixth-largest steelmaker. The new steel mill is expected to consume 13 million tons of iron ore annually.
The stock price of Hyundai Steel Co. leapt 6,700 won ($7.23) or 15 percent, to 51,700.
with the Korea JoongAng Daily
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