The photo shows a Hyundai Steel production facility in Pohang, some 270 kilometers southeast of Seoul. (Image courtesy of Yonhap)
SEOUL, Dec. 16 (Korea Bizwire) — Hyundai Steel and POSCO are moving forward with plans to build a large-scale electric arc furnace (EAF) steel mill in Louisiana, targeting commercial operation in 2029, as South Korean steelmakers expand production in the United States to meet automakers’ growing local supply needs.
The companies announced on Tuesday that they have executed equity investments for the project, which will supply steel for Hyundai Motor Group’s expanding U.S. manufacturing network, including Hyundai Motor Group Metaplant America (HMGMA).
Hyundai Steel confirmed it will invest a total of $5.8 billion to construct a mill capable of producing 2.7 million tons of steel annually. The facility will manufacture hot-rolled, cold-rolled and coated automotive steel tailored for the U.S. market.
The financing structure includes $2.9 billion in equity and $2.9 billion in external borrowing. Of the equity portion, Hyundai Steel will hold 50 percent, POSCO 20 percent, Hyundai Motor 15 percent and Kia another 15 percent.
A key feature of the Louisiana project is its integration of direct reduced iron (DRI) production with an electric arc furnace, an arrangement designed to improve energy and transport efficiency. By relying on DRI and steel scrap rather than traditional blast furnaces, the companies expect to cut carbon emissions by roughly 70 percent.
This photo shows the corporate flag of POSCO Holdings. (Image courtesy of Yonhap)
POSCO said the partnership will help the firm secure a U.S. production base capable of supplying low-carbon steel while mitigating tariff exposure under American trade policies.
Hyundai Steel added that its roughly 2 trillion won share of the investment can be financed through internal cash flow through 2028, when construction is expected to be largely completed.
Ashley Song (ashley@koreabizwire.com)
