The strength in global steel demand is expected to continue through the second half of the year in accordance with recovery in downstream industries, economic growth, and accelerated stimulus efforts, Hyundai Steel reported on Tuesday. However, steel prices are likely to trend flat in H2 2021 as the steel shortage eases.
The company expects its domestic construction investment to increase by 1.6pc to KRW268tr ($232bn) in 2021 and automobile production to rise by 6.8pc to 3.8 million vehicles in South Korea and global production to rise by 13.4pc to 84 million units annually. The shipbuilding industry is anticipated to increase globally to 32mn cgt, up 54pc, in 2021, which translates to an increase of 14.9pc to 10.1mn cgt in the domestic market.
Steel production down in H1
Hyundai Steel produced 9.16mn mt in H1 2021, down 6.4pc from 9.79mn mt in the first half of 2020. The company’s sales increased by 5.2pc to 9.96mn mt against 9.47mn mt in the same period.
The company’s Q2 2021 steel production at 4.66mn mt remained almost flat against 4.7mn mt in the same year-ago quarter. Electric arc furnace (EAF) output grew by 11.6pc to 2mn mt as blast furnace volumes dropped by 8.5pc to 2.48mn mt.
In Q2 2021, Hyundai Steel’s sales rose by 7.9pc to 5.04mn mt compared to 4.67mn mt in the same quarter of the prior year. Its revenue leaped by 32.3pc to KRW4.87tr in Q2 2021 against the same year-ago quarter.
Consolidated revenue climbed by 36.7pc to KRW5.6tr in Q2 2021 compared to the same period last year as operating income multiplied to KRW545bn in Q2 2021 compared to KRW14bn in the same year-ago quarter. Net profit followed suit with a gain of KRW353bn in Q2 2021 contrary to a loss of KRW13bn in the same quarter last year.