South Korean companies POSCO Holdings Inc. and Hyundai Motor Group have signed a memorandum of cooperation for the construction of a large-scale steel plant in the USA. The project will cost $5.8 billion and will have a capacity of 2.7 million tons of steel per year. The plant is scheduled to launch in 2029, according to Bloomberg.
This is reported by Business • Media
Strategic Importance of Investments in the USA
While the exact amount of POSCO’s investment in this project is currently undisclosed, the involvement of one of the largest steel producers in South Korea, along with Hyundai, which owns the second-largest steel plant in the country – Hyundai Steel, indicates the strategic significance of the initiative. According to Hyundai representatives, the new plant will provide a stable supply of high-quality automotive steel for the company’s manufacturing facilities in the USA.
Additionally, the companies plan to collaborate in the areas of battery production and securing raw material supply chains that meet American and European standards. This project is one of the key components of Hyundai’s overall $21 billion investment program in the USA.
President Donald Trump previously noted that this initiative is a confirmation of the effectiveness of the tariffs imposed on steel and aluminum imports, which were aimed at supporting domestic production.
Future Opportunities and US Response
In light of the news, South Korean officials are planning a trip to Washington to persuade the American administration to lift or ease the tariffs, including the 25% duty on Korean steel and automobiles. It is worth noting that in March of this year, Hyundai Motor Group announced investments in the USA totaling $21 billion by 2028, including the construction of a steel plant with an electric arc furnace in Louisiana, which will create over 1,400 jobs and produce next-generation steel.