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Dongkuk eyes buying UK slab from next year - 31 August 2011

Dongkuk Steel Mill says it is willing to sign a long-term contract to buy slab from Teesside Cast Products (TCP) in the UK when it restarts. “We have expressed our intention to buy 500,000 tonnes/year of slab from TCP,” Kim Chul-hwan, managing director of Dongkuk’s raw material division, told shareholders Monday when tabling its Q2 earnings. “We expect purchasing TCP slab will be possible from next year.

TCP’s new owner, Thai steel producer Sahaviriya Steel Industries, foresees its 3.5m tonnes/year UK slab plant resuming operations from late-2011 and thus has been talking with several possible long-term clients, a Dongkuk spokesman says. “We have been in talks with them too,” he tells <b>Steel Business Briefing.

The Korean plate maker’s move is to develop new slab sources after Australia’s BlueScope Steel, one of its long-term suppliers, decided to stop one of its Port Kembla blast furnaces from October and halt exports.

“There will be no huge impact short-term from BlueScope as (we) have sufficient slab inventory,” Kim said. “(BlueScope’s case) rather helps us to adjust our high stocks.” Dongkuk has taken 400,000 t/y slab from BlueScope though the company would not comment on current slab shipments from the Australian mill.

Dongkuk has a plate capacity of 4.4m t/y from its works in Pohang and Dangjin, and imports almost all its slab needs. Its heavy reliance on outside slab purchases should ease when its slab joint venture in Brazil starts production in late 2014.

The slabs-for-export joint venture between Vale, Posco and Dongkuk – Companhia Siderúrgica do Pecém – broke ground on its 3m t/y project earlier this month, as SBB reported.

 

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