Hyundai Steel and POSCO Break Ground on First U.S. Steel Plant, Seeking to Beat 50% Tariffs and Secure Supply Chains

In the middle of a vast Louisiana sugarcane field, Hyundai Steel and POSCO have begun work on a project described as historic for both South Korea’s steel industry and the United States.

A groundbreaking ceremony took place on Sept. 4 in Donaldsonville, about 90 minutes from New Orleans, for the Hyundai Steel-POSCO Louisiana electric-furnace steel plant. It will be the first production base that South Korean steelmakers have built in the United States. For the United States, the project is also described as the first new integrated steelworks built in more than 60 years.

The plant will occupy 7.37 million square meters, roughly 2.5 times the area of Seoul’s Yeouido district. The companies plan to invest $5.8 billion and target annual production of 2.7 million tonnes.

The unusual strategic joint venture seeks to avoid steel tariffs reaching 50% and strengthen supply chains inside the United States. Hyundai Steel will hold 50%, Hyundai Motor and Kia will each hold 15%, giving Hyundai Motor Group an 80% stake overall. POSCO will hold the remaining 20%. Hyundai Motor Group Chairman Chung Euisun delivered a welcoming address at the ceremony.