On January 18, South Korean steel giant
POSCO entered into an agreement with
India's largest ferrochrome producer Indian Metals & Ferro
Alloys Ltd (IMFA) to establish a joint venture (JV) ferrochrome producing company, allowing
POSCO to stably and economically secure main materials for its stainless steel
production.
According to a
POSCO release, the South Korean steel giant and IMFA will own 24 percent and 76 percent respectively in the company which will own the new electric furnace completed this past November. Annual
production of the new electric furnace built within the IMFA factory located in Chudwar, Orissa in
India will be 35,000 mt per year.
25-year deal POSCO's statement said that
POSCO can purchase all ferrochrome produced through this new furnace at low costs for 25 years, while IMFA procures chrome and electricity at low costs from its mines and electric power facilities to achieve profits from this joint company, holding all rights to ferrochrome manufacturing and the operation of the company.
Ferrochrome, with great corrosion- and heat-resistance properties, is an essential ferroalloy in the
production of stainless steel.
POSCO has been importing 480,000 mt of ferrochrome each year.
POSCO also has access to 60,000 mt of ferrochrome being provided by POSChrome, a joint venture ferrochrome company established in South Africa.