South Korea's Posco expects fourth quarter steel demand to be firm on the back of lower Chinese production and demand from emerging markets, the steelmaker said Tuesday.
As a result, it expects to post consolidated annual sales of Won 64.8 trillion ($57 billion), up from a previous estimate of Won 64.1 trillion in July. In 2017, revenue achieved was Won 60.7 trillion.
Lower Chinese production is expected due to government policies aimed at reducing pollution and excess capacity, it said while commenting on its Q3 financial performance. Net profit hit Won 1.058 trillion in Q3, up 17% from Won 906.6 billion the year before. "Steel demand in the construction and energy industries was robust in the third quarter. Increased equity gains from PT Krakatau Posco also buoyed the quarterly result," it said.
Krakatau Posco is the steelmaker's 70:30 joint venture with Krakatau Steel in Indonesia, which is expected to start construction of a 1.2 million-1.5 million mt/year cold-rolling mill in 2019 to produce automotive-grade steel.
For 2018, Posco expects crude steel production to reach 37.7 million mt, up 1.34% from 37.2 million mt in 2017.
