Steelmakers to hike capital spending this year

SEOUL, Jan. 15 (Yonhap) -- POSCO and other major South Korean steelmakers are planning to increase spending on facility expansion this year despite a grim economic outlook, industry sources said Thursday.

POSCO, the world's fourth-largest steelmaker, plans to invest a record 6 trillion
won (US$4.39 billion) this year in anticipation of a pick-up in demand. It
invested 3.4 trillion won in 2008.
Hyundai Steel, South Korea's No. 2 steelmaker, is planning to spend 2.5 trillion
won this year, up from last year's 1.77 trillion won.
"Local steel mills are boosting spending with hopes that steel demand will pick
up down the road," said Chung Young-kwon, an analyst at Hanwha Securities.
Demand from automakers and shipbuilders is declining due to a deepening economic
slowdown, Chung said. "But increased spending on facilities will help them meet
steel demand when the global economy recovers."
Dongkuk Steel Mill Co. and Dongbu Steel Co. also plan to double their spending
for the year to 900 billion won and 300 billion, respectively.