The South Korean Government Released The "steel Industry Improvement Plan"

By Author: Sinosteel Pipe
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Recently, the South Korean government held a ministerial meeting related to strengthening industrial competitiveness and released the "Steel Industry Advancement Plan" for the steel industry. The plan focuses on promoting financial support, strengthening anti-dumping measures, R&D support, transforming to a high value-added, low-carbon emission system, and providing support for the steel industry that is facing difficulties such as high tariffs.
Address barriers to overseas steel exports and strengthen trade and financial support
The South Korean government pointed out that the spread of protectionist trade policies in various countries, including the United States' 50% tariff on steel products, has significantly reduced South Korea's steel exports. Therefore, it is necessary to actively solve the short-term problems faced by enterprises to ensure their viability.
First of all, the South Korean government will implement a targeted country response strategy: for the United States, it will continue to negotiate a plan to reduce the burden of steel product tariffs (50%); for the EU, it will formally launch ...
... bilateral official and unofficial negotiations to respond to its policy of converting safeguard measures into low tariff quotas (TRQ) announced in October, and to prepare for the implementation of the Carbon Border Adjustment Mechanism (CBAM). In addition, the Korean government also plans to continue consultations on India's safeguard measures and quality certification (BIS) to reflect the position of the Korean steel industry to the greatest extent possible.
The South Korean government will steadily implement the "Follow-up Support Countermeasures for U.S. Tariff Negotiations" announced in September, and will steadily and rapidly advance the preparation of emergency loan funds (scale 20 billion won) for companies affected by U.S. tariffs, and provide low-interest (1.5%-2.0%) loans to companies affected in fields such as steel, aluminum, and derivatives.
At the same time, the Korean government will also strengthen content value calculation and certification consulting support related to derivatives tariff response, including steel and aluminum content value certification, tariff rate calculation, customs clearance document production, etc.; and a new "Export Supply Chain Strengthening Guarantee Plan" with an estimated scale of 400 billion won will expand financial supply to affected companies such as steel, aluminum and derivative products, and strengthen the export competitiveness of its steel industry.
The export supply chain enhancement guarantee plan launched within 2025 will be based on special investments from leading export companies such as Posco Steel Corporation and commercial banks. It will include content to support symbiotic cooperation between large and medium-sized enterprises, such as providing interest rate concessions for the production funds of cooperative enterprises and expanding the guarantee limit.
In addition, the South Korean government plans to add a 2.8 billion won "secondary guarantee business" for affected companies in steel, aluminum, copper and derivative products. It is expected that through this initiative, the interest burden on the industry when procuring raw materials or making investments in equipment will be reduced.
Through the above-mentioned comprehensive export countermeasures, financial support of approximately 570 billion won will be provided to affected enterprises (mainly small and medium-sized enterprises and major enterprises) in steel, aluminum and derivative products.
Respond to unfair imports and block bonded areas from avoiding dumping
In response to the expansion of trade barriers and the flow of excess exports into the Korean market, the Korean government plans to promote multiple countermeasures such as strengthening trade remedy measures, expanding circumventive dumping supervision, and officially launching import monitoring.
The South Korean government has emphasized the need to deal with imports. It believes that as major countries compete to expand trade barriers, excess exports from various countries are flowing into South Korea, and there are concerns about damage to the industrial base; a systematic response is needed to provide support for efforts to transform the industrial structure.
The Korean government plans to promote the fair implementation of trade remedy measures and at the same time conduct consultations with the countries being complained and the industries in demand. The specific plan is to actively utilize bilateral trade dialogue channels and normalize consultations with the industry to improve the effectiveness of import response.
The Korean government will use the Customs Service (Customs) to strengthen the investigation of violations of origin labeling and the investigation of anti-dumping duty avoidance. In addition, illegal information will be exchanged with organizations such as the Korea Iron and Steel Association, joint investigations will be carried out, and products such as seamless steel pipes will be newly designated as items that require declaration of circulation history. Especially for products or companies that have been subject to anti-dumping sanctions, if there are product classification violations and price commitment violations, the government plans to establish a mechanism to use tariff investigations and import and export data to investigate transactions suspected of circumventing dumping and notify relevant agencies.
To this end, the Korean government has signed business cooperation agreements with the Korea Iron and Steel Association in July 2025 and the Korea Trade Association in September to negotiate the establishment of a cooperation system and timely exchange of information. In addition, the Korean government also plans to strengthen the institutional foundation to improve the effectiveness of steel trade responses. This move aims to build institutional guarantees to block illegal imports from the source and improve the effectiveness of trade response.
Starting from 2026, imported steel products will be required to submit a Material Certificate (MTC), and the monitoring of imported products will also be officially launched. Prior to this, confirmation of the quality of imported products and the country of crude steel production will be achieved. Specifically, it is expected that through the revision of the "Foreign Trade Law Enforcement Order" and related announcements, the mandatory requirement to submit a material certificate during product production and import declaration will be implemented.
At the same time, the South Korean government has made it clear that it plans to block the possibility of circumventing anti-dumping duties through third countries and bonded zones from the source. Major departments such as the Ministry of Industry, Commerce, Industry and Energy, Strategy and Finance will participate to promote the revision of relevant terms and expressions. Especially in the dumping supervision content, for the "slight processing within the same country" rules that are accused of "many circumvention methods", the rules will be improved by "deleting the content of restrictions in the supply country and adding the content of assembly and processing in third countries" to prevent dumping imports through "loopholes".
In addition, in response to the problem of "processing products that have been subject to anti-dumping duties in bonded factories and then importing them into the country to avoid tariffs," the Korean government plans to strengthen the management system, including mandating bonded factories and related areas to declare raw material tax information, shortening the bonded concession period from 10 years to 1 year, etc. On the other hand, in response to the recent demands from the steel industry for tariff revisions on 17 types of steel (auxiliary) raw materials, the South Korean government will apply additional emergency quota tariffs to some varieties in 2025 and expand relevant support from 2026.
Concentrated investment in research and development of special steels
For future potential products such as special steel used in shipbuilding, energy, automobiles, national defense, aerospace and other fields, the Korean government will increase investment and actively seize the global market to help South Korea build a production base and achieve the world's top level of technological strength.
First of all, the Korean government stated that it will overcome the current difficulties through research and development of future potential technologies, and explained that it plans to formulate and release a research and development roadmap for 10 types of special steel products within the year, led by the Ministry of Industry, Trade and Energy. At present, the proportion of special steel in the Korean steel industry is only 12%, which is lower than that of developed countries such as Japan (17%) and Germany (38%). To this end, the Korean government plans to invest 200 billion won in 10 types of special steel by 2030 to achieve the goals of "ranking first in the global market share of products in categories 5 and above" and "expanding market share to more than 20%."
In particular, the Korean government plans to focus on the research and development of special steel for extreme environments required by the shipbuilding and energy markets. Among them, the shipbuilding field will focus on supporting the research and development of special steel for next-generation ships such as LNG cargo tanks, while the energy field will support the research and development of special steel for land and sea energy compression, transportation, and injection in extreme environments.
In terms of material classification, high manganese steel, nickel steel, chromium steel, composite steel plates, stainless steel, etc. will receive research and development support; in terms of product classification, medium and thick plates, welded steel pipes, seamless steel pipes, forged steel parts, etc. will be included in the scope of support. These steels and products are currently used in fields such as shipbuilding, special ship outer plates, energy transmission and transportation, steel pipes and pipes for ultra-deep well drilling, high-temperature and high-pressure power components, and may have great market development potential in the future. In addition, the Korean government also plans to support the research and development of ultra-high-strength, lightweight special steel needed in the automotive, defense, and aerospace fields. The strategy aims to increase the market share of related products by more than 20% compared with 2024 by supporting companies to seize the high value-added materials market in these future potential industries.
Specifically, the automotive field will focus on supporting the research and development of lightweight, high-strength special steel to improve fuel efficiency and electric cruising range; the national defense and aerospace fields will support the research and development of special steel with improved protective performance, lightweight, fatigue resistance, and high temperature resistance. In these two areas, products such as high-silicon steel, low-alloy cold-rolled steel plates, low-zinc hot-dip galvanized steel plates, non-quenched and tempered steel, carburized alloy steel, etc. will receive centralized support. These products can be used in high-performance drive motor cores, body-in-white, chassis, drive system components, steering devices, high-power gearboxes, etc., and are expected to create new markets with high added value.
At the same time, the South Korean government stated that it will work hard to create demand for high-quality steel and expand its application scope. The plan, led by the Ministry of Industry, Trade and Energy, will support the research and development of technological products to expand domestic supply. Specifically, the "Steel Industry Special Law" (K-Steel Law) will be used to promote the application of evidence-based technology and support the market cultivation and expansion of R&D technology through preferential procurement and other methods.
The Korean government plans to promote the inclusion of "prioritizing the use of domestic high-quality steel" clauses in infrastructure project bidding and technical specifications through cross-department collaboration; and at the same time implement project promotion policies that can promote steel consumption, such as modular buildings (including "supply of 3,000 modular public housing units per year", etc.); in addition, it will gradually include the direction and principle of "prioritizing the use of safety performance and excellent quality steel" in major government statutory plans. Through the government's first demonstration, it will promote the use of domestic high value-added and high-value steel. Among them, the Korean government plans to support the launch and creation of "special steel products that support the transformation of renewable energy" brands such as high-corrosion-resistant medium-thick plates for offshore wind power, high-corrosion-resistant steel and steel pipes for photovoltaic brackets for agriculture in saline-alkali land, and promote the cultivation of related markets.
Provide support for artificial intelligence and market cultivation
The Korean government will also promote the AI ​​transformation of industrial scenarios to improve production efficiency, strengthen environmental protection performance and safety management. The government plans to participate in the "AI Factory M.AX Alliance" composed of 12 fields including steel, semiconductors, and automobiles, and take the lead in the research and development of steel-specific AI models. At the same time, the Korean government will build a virtual environment through "digital twins" to allow professionals to work in virtual scenes, convert experience in operating standards, predictive maintenance, quality management, etc. into data to build the foundation for AI applications; and will promote the current AI factory projects such as "AI independent predictive maintenance in steel processes and autonomous robot technology research and development for high-risk operations" and "independent manufacturing technology research and development for large-diameter steel pipe manufacturing capacity improvement process optimization" to the entire steel industry; in addition, it will also start to build an AI empirical system covering the entire life cycle of the steel industry.
On this basis, in order to expand the supply of high-quality steel products, the Korean government will promote the use of high-quality steel products in infrastructure construction and other projects; at the same time, it will begin to develop steel-specific AI models to help realize manufacturing process innovation through AI. In addition, industrial site safety management will be strengthened, including the introduction of AI-based video surveillance to prevent major accidents and the construction of intelligent safety solutions for steel industrial parks. The South Korean government also plans to ensure national safety by blocking products that do not comply with Korean Industrial Standards (KS) from entering the market and strengthening post-event management.
Phased green competitiveness improvement support plan
The Korean government will also help promote the transformation of low-carbon processes. On the one hand, the research and development of proven hydrogen reduction ironmaking technology that has passed budget review will be steadily promoted; on the other hand, the green transformation of the steel industry will be accelerated through measures such as expanding the use of electric arc furnaces, stabilizing the supply and demand of scrap steel, and introducing a low-carbon certification system.
Starting in 2026, before hydrogen reduction ironmaking technology is commercialized around 2035, the Korean government will promote the replacement of raw materials and fuels in 11 blast furnaces and the expansion of electric arc furnace production capacity; then, from 2036 (when hydrogen reduction ironmaking technology is expected to begin commercialization) to 2050, the 11 blast furnaces will be gradually transformed into 15 hydrogen reduction ironmaking furnaces.
At the current stage of commercialization of hydrogen reduction iron-making technology, cultivating demand for low-carbon steel products is crucial to promoting low-carbon transformation. Currently, the Korean government is formulating low-carbon emission steel standards based on the decarbonization characteristics of the domestic steel industry, and plans to establish a cross-departmental demand-stimulating mechanism linked to the green product compulsory procurement system, public procurement, etc. for certified low-carbon steel products.
In addition, the Korean government has promised to fully support the mastery of "hydrogen reduction ironmaking", a core technology that can achieve a leap-forward improvement in green competitiveness. In June 2025, the hydrogen reduction iron-making project has passed a preliminary feasibility study (total investment 810 billion won), and relevant technical support policies will be officially launched; various departments will jointly formulate incentive measures to ensure a stable supply of economically viable clean hydrogen. At the same time, the Ministry of Industry, Trade and Energy and the Ministry of Climate, Environment and Energy will work together to formulate and release an energy utilization plan based on stable power supply.
At the same time, the Korean government will also work to stabilize the supply and demand of scrap steel, the core raw material for low-carbonization of electric furnaces. The current scrap self-sufficiency rate of South Korea's steel industry is about 80%-90%. Although it is considered that a certain degree of self-sufficiency can be achieved, the industry is worried that there will be a shortage of high-grade scrap supply considering the future expansion of electric furnace scale and the possible scrap export controls implemented by major countries.
In this regard, the Ministry of Industry, Trade and Energy and the Ministry of Environment of South Korea plan to jointly formulate and release a "Steel Scrap Industry Cultivation Plan" in the first half of 2026. This plan will be used to improve the infrastructure of the scrap steel system, improve unreasonable industry practices, and clarify the classification standards of steel scrap as a resource. In addition, it will also promote the standardization of scrap steel trading standards and establish new industry regulations that replace bill transactions with cash transactions.
On this basis, the Korean government has also clarified the industry cultivation policy of cultivating scrap steel professional enterprises and providing centralized incentives. It is planned to identify professional enterprises by reviewing indicators such as processing scale and financial capabilities, and at the same time promote the development and application of artificial intelligence inspection systems and expand equipment transformation to cultivate a large number of competitive scrap steel enterprises. To this end, the government will gradually improve the financing conditions for scrap steel companies through public and private funds such as steel environmental protection, precise policy financial funds, and steel ESG symbiosis funds.
On the other hand, the Korean government will also simultaneously promote supply and demand stabilization support measures for non-ferrous scrap metals such as aluminum and copper. Among them, the scrap aluminum field is exploring plans to force the use of domestic scrap aluminum cans as recycled raw materials; the scrap copper field is studying measures to eliminate illegal exports, strengthen coordinated supervision systems and public reserves.
It is worth mentioning that the Korean government plans to formulate an export plan for Korean-style hydrogen reduction ironmaking technology and equipment in the future. To this end, we will focus on investing resources and build the EPC business capabilities of the world's first "fluidized reduction hydrogen reduction ironmaking" project relying on the Finex process, which is the country's core technology.
In addition, the Korean government has also promised to provide financial support for large-scale process transformation that companies cannot afford on their own. At present, major countries (regions) such as Japan and the European Union are focusing on providing financial support and equipment subsidies related to low-carbon transformation based on the specific process transformation plans of enterprises. In response to this trend, the Korean government also plans to provide systematic guarantees for the transformation of low-carbon processes such as raw fuel substitution and electric arc furnace expansion based on the "Steel Industry Special Law." In particular, under the leadership of the Ministry of Strategy and Finance, research on the identification of "new power source technologies" will be launched to promote investment in process transformation.
Provide "capacity adjustment" support based on enterprise requirements and market-oriented
For steel products such as steel bars, steel sections, and steel pipes whose competitiveness has weakened due to oversupply, the Korean government will adopt the approach of "supporting companies when they propose production capacity adjustment plans." This means that if there are shortcomings in the independent adjustment plans currently being promoted or planned by individual companies, the Korean government can play a coordinating role and create conditions for companies to formulate independent adjustment plans.
For the situation where many companies in categories such as steel sections and steel pipes have proposed production capacity adjustment plans, companies will be guided to advance production capacity adjustments based on the premise that companies fulfill their operational responsibilities such as ensuring employment, and in conjunction with the designation of "industrial crisis forward-looking response areas".
If a certain type of product is greatly affected by imported products, the Korean government will give priority to measures to deal with imports, and then gradually adjust the scale of production capacity if necessary based on market conditions; conversely, if a certain type of product is relatively less affected by imported products, it will give priority to creating necessary conditions for production capacity adjustment.
For products where oversupply problems are relatively eased, such as electrical steel plates, the Korean government will promote decisive forward-looking investment. Under this situation, the government plans to implement a demand-centered response strategy by supporting initiatives that promote forward-looking investment by companies and studying the designation of special steel-related technologies developed in the future as "new power source technologies."
At present, the South Korean government has pre-listed "steel bars" as a key target for production capacity adjustment. This category not only has limited willingness of enterprises to adjust independent production capacity, but also has a penetration rate of imported products of only about 3%. To this end, the Korean government plans to work with relevant departments to formulate a support plan for the steel industry for "adjustment of independent production capacity above a certain scale."
For products such as steel bars that are listed as key targets for production capacity adjustment, the government plans to explore the possibility of promoting business restructuring in accordance with the "Enterprise Vitality Law". If relevant conditions are met, tax and other incentives will be provided for business restructuring. For categories with high penetration rates of imported products such as hot-rolled steel plates, cold-rolled steel plates, and galvanized steel plates, measures to deal with imports will be taken first, and then whether to reduce production capacity will be gradually studied.

Sinosteel Stainless Steel Pipe is the Manufacturer and Supplier of Stainless Steel Pipe and Special Alloy Pipe, Steel pipes with an outer diameter from 8mm to 3600mm, with wall thicknesses from 0.2mm to 120mm.