POSCO Annual Report

Suk-Hoon Kang (left)
Masters Candidate
Laboratory of Material Deformation&Processing Seoul National University

Kyung-Moon Lee (right) Masters Candidate Alloy Design Laboratory Seoul National University

“We're excited to be working with POSCO on the future of steel. While the company is well known for its long-standing relationships with Pohang University of Science and Technology and the Research Institute of Industrial Science & Technology, POSCO has also dramatically expanded its support of basic research to leading universities in Korea and abroad over the past decade.”

High-Grade Electrical Steel
In 2003, we began expanding our high-grade grain-oriented steel production capacity and developed new production technologies for high-grade non-oriented very-low-core-loss electrical steels commonly used in large motors and generators. We also developed new grain-oriented low-core-loss electrical steels with magnetic domain refinement technologies. As we review additional production capacity expansion for thin-gauge and high-grade grain-oriented electrical steels, we will continue to boost production of high-grade non-oriented electrical steels through technical advances and process optimization to meet increasing demands for applications like environment-friendly hybrid electric vehicles.

FINEX Ironmaking
Our FINEX process has a host of advantages over the traditional blast-furnace process. The process offers lower production costs thanks to the ability to use cheaper coking coal for fuel. FINEX also eliminates costly up-front investment in sinter and coke plants, a significant environmental-friendly advance that produces only 6% of the SOx, 4% of the NOx, and 85% of the CO2. Commissioned in May 2003, our 600,000-ton-per-year FINEX demo plant is now being used to evaluate and verify process and facility reliability. In 2004, we plan to build and commission our first commercial 1.5-million-ton capacity plant. We fully expect FINEX technology to emerge as a leading ironmaking technology that will help keep steel sustainably growing in the 21st century.

High-Strength Structural Steel
High-strength structural steel used in the construction, automobile, and shipbuilding industries, high-strength structural steel features a fine crystalline grain structure approaching 2 microns that is formed without alloying or heat treatment, resulting in a tensile strength in excess of 800 MPa. Today, we're developing ultrafine-grain plate, hot-rolled, and wire rod products using our existing rolling facilities as we move ahead with projects to commercialize ultrahigh-strength 1,300 MPa-class bolt steel and highly corrosion-resistant steels that will dramatically extend the service life of seaside steel structures.

Manufacturing Productivity
At an integrated steelworks, high productivity in the ironmaking and steelmaking processes is essential to keep downstream processes working smoothly. In 2003, we continued to develop cutting-edge technologies, processes, and systems that will enable us to get more stable and productive performance from our steelworks facilities in the years ahead. In the ironmaking field, we focused on the operational stability of our aging blast furnaces as we worked to achieve zero downtime through a comprehensive inspection and preventive maintenance regime. We developed and implemented an online furnace temperature control system at the Pohang No. 4 Blast Furnace. These and other advances enabled us to increase our 2003 pig iron output by 744,000 tons to 27,314,000 tons.

E-procurement successes
Information technology has revolutionized procurement at POSCO. Launched in 2001, our e-procurement system has reduced processing time from 9 days to just 2.3 days in 2003, handling 93% of total purchases. During the year, we upgraded our strategic sourcing capabilities by implementing a supplier relationship management system that's now elevating the competitiveness of our supply chain. The system provides our suppliers with performance feedback, current inventory information, bi-annual raw material requirement forecasts, channels to make proposals and introduce new technology, and up-to-the-minute information on transport ship location.