POSCO International Strikes MOU on Modular Plant in Ukraine as 1st Step to Reconstruct Country

Chairman Jeong Tak of POSCO International shakes hands with Vitalii Kim, Mykolaiv Governor, after signing an MOU to establish steel modular manufacturing facilities on Nov. 14.

POSCO International will build a modular manufacturing facility in Ukraine.

POSCO International, leveraging its local network, is expected to make the most of cooperation with POSCO Group’s subsidiaries.

A modular construction method is expected to be made available widely for the reconstruction of Ukraine since it requires a shorter construction period.

POSCO International Vice Chairman Jeong Tak visited Ukraine from Nov. 13 to the Nov. 15, as the first representative of a Korean private company to visit Ukraine since the breakout of Russia’s invasion.

He signed a memorandum of understanding (MOU) with Vitalii Kim, Mykolaiv Governor, to establish ‘steel modular manufacturing facilities.’

The modular construction method is the initial step in Ukraine’s reconstruction, based on the consensus that building social infrastructure, such as housing, schools and hospitals, is a priority in the post-war recovery process.

Modular structures, which are assembled like blocks, are considered an ideal construction method for post-war reconstruction as they can reduce the construction period by up to 60 percent.

The business capabilities of POSCO Group will be integrated to supply the modular structures. Alongside the steel products of POSCO and the engineering technology of POSCO A&C, POSCO International’s local network and negotiation capabilities will be utilized to promote the local business.

Particularly, POSCO A&C, an affiliate of POSCO Group proficient in designing, manufacturing, and constructing modular structures, has been involved in the development of the modular business in Ukraine since its inception.

The modular structure manufacturing facility will be located in the southern Ukrainian region of Mykolaiv.

This region hosts sole investment asset of Korea in Ukraine, which is POSCO International’s grain terminal.

Additionally, the fact that the promising local politician, Mykolaiv Governor Vitalii Kim, is a Korean descendant also known as ‘Koryo-saram’, augments the business prospects.

With the MOU, the company anticipates expanding its business scope from the agro-industry to the infrastructure sector in Ukraine.

The grain terminal, which commenced operation in 2019, played a crucial role in Ukraine's business for three years before the war, exporting approximately 2.5 million tons of Ukrainian grain to Asia, the Middle East, Africa, and other countries.

Although its operation was temporarily suspended during the war, the facility remains undamaged and continues to function partially with local and international employees.

During his visit, Jeong Tak also met with Vicor Ivanchyk, CEO of the local agricultural company Astarta, to discuss Ukrainian grain exports that have been impeded by the naval blockade.

They further discussed how to utilize the grain terminal and expand the value chain in the grain sector post-war.

Chairman Jeong Tak of POSCO International exchanges views on reconstruction projects with Ukrainian Denys Shmyhal during their meeting in Kyiv. (Photos: POSCO International)

Before that, Jeong Tak met with Prime Minister Denys Shmyhal and other key government officials in Kiev, which included Rostyslav Shurma, Deputy Head of the Office of the President of Ukraine (for Economic and Industrial Affairs), and Yurii Vaskov, Deputy Minister for Communities, Territories and Infrastructure Development of Ukraine, to discuss a wide range of reconstruction initiatives.

At the meeting, Jeong Tak expressed POSCO Group’s commitment to participate in the reconstruction of Ukraine with all its capabilities, including steel, energy, construction, and IT. He requested the central government’s support for the newly launched modular project.

In response, Prime Minister Shmyhal expressed high expectations for the reconstruction project proposed by POSCO International, and requested continued interest and investment to expedite the recovery of the Ukrainian economy.

POSCO International Announces Growth Roadmap for Green Material Business

POSCO International has announced its growth roadmap for the green material business, a focused priority area for company advancement.

POSCO International organized the Green Material Value Day event, which was attended by approximately 60 institutional investors and securities firm analysts.

It was led by Lee Kye-In, Chief Officer of Global Business Unit, Kim Byung-Hwi, Head of Green Department, and No Min-Yong, President of POSCO Mobility Solutions, at the FKI Tower in Yeouido on Nov. 8.

This newly created ‘Value Day,’ an IR event where key executives explain the company's growth plan to investors and securities experts, is the second such event this year, following the 'Energy Value Day' event held in last July.

This event marked the first public appearance since the company decided to focus on ‘eco-friendliness’ as its growth axis and developed business strategies around the newly established Green Management Department through organizational reform.

“The sales and operational margins of the green material business are projected to grow by 200 percent and 400 percent, respectively, by 2030,” Lee Kye-In, Chief Officer of Global Business Unit, predicted at the event.

“The company aims to fully realize its name as an eco-friendly integrated corporation in the future,” he said.

He then proposed a roadmap and specific strategies for achieving these goals in four business groups: green energy steel, green mobility, green secondary battery materials, and green steel materials.

Firstly, the sales goal for the energy steel business in 2030 has been set at 2.23 million tons, as the proportion of renewable energy generation has been rapidly increasing.

According to renewable energy-related statistics, the proportion of renewable energy generation is expected to increase from 25% in 2020 to 58% by 2030, and the cumulative demand for green steel will be 5 billion tons.

In response to this, POSCO International plans to secure price stability through a long-term supply contract with POSCO centered on ‘Greenate,’ a structural steel designed to reduce carbon emissions.

Moreover, the company aims to dominate the future green market by developing secured offshore carbon storages in the United States, securing the offshore CCUS platform project in Malaysia, partnering with a company specialized in air battery for steel supply, and developing proactive technology.

Next, in the mobility industry, the company is expanding its business to the hydrogen car value chain while securing an integrated package contract covering battery, parts, and the chassis itself.