Posted on 03 Apr 2025
Hyundai Steel, Korea's second-biggest steelmaker, shut down its steel reinforcement bar factory in Incheon on Tuesday amid sluggish demand and a flood of competitively priced products from China.
It was the first time the steelmaker had completely shut down a rebar production facility since its founding in 1953.
The suspension, which will last a month, forced roughly 400 employees to stay home, receiving just 70 percent of their salaries.
"The one-month halt aims to reduce our production amid low demand, and even if we restart the factory after a month, we may reduce the production volume there considering the market conditions," a spokesperson for Hyundai Steel told the Korea JoongAng Daily.
The Incheon plant handles 1.5 million tons of steel bar production annually, half of Hyundai Steel's total steel bar production capacity. Hyundai Steel is Korea's No. 2 rebar maker, producing 3.3 million tons of rebar annually and accounting for roughly 30 percent of the market share.
Due to the sluggish construction industry and an influx of China-made low-priced products, the price of rebar has plunged in Korea in recent years, plummeting from 1.1 million won ($748) per ton in March 2022 to 676,000 won this month.
In February, Hyundai Steel also temporarily suspended its cold-rolled steel facility in Dangjin, South Chungcheong, for over a month due to a protracted strike by its workers over pay. The unionized workers plan to stage another walkout on April 8.
The Incheon plant's one-month break comes after Hyundai Steel declared it would enter emergency management mode on March 14 to tackle looming global uncertainties sparked by U.S. President Donald Trump's tariff wars, including the White House's imposition of 25 percent tariffs on steel imports.
Hyundai Steel is also offering early retirement to all salaried employees 50 or over to slim the work force and cut raw costs. Early retirements and buyouts are among the country's most common forms of job cuts due to strict legal guidelines on layoffs.
The salaries of all executives were slashed by 20 percent under the emergency management mode.
Hyundai Steel's operating profit suffered an 80 percent drop on year to 159.5 billion won in 2024.
However, the steelmaker is pushing for massive investments in the United States to avoid tariffs, including a $6 billion automobile steel plate factory in Louisiana.
Hyundai Steel shares closed at 24,600 won on Tuesday, falling 1.6 percent from the previous session.
Source:Korea JoongAng Daily
