Overview
To stay competitive in a steel market facing global oversupply and rising trade barriers, Korea must shift toward green steel. Demand is accelerating—especially from European automakers—with projections rising from 15 million tons in 2021 to over 200 million tons by 2030. Korea’s path to market entry is through DRI-EAF technology. EAF capacity is expanding, and using a 70% DRI and 30% scrap mix can cut emissions by 81% versus BF-BOF. But success depends on securing affordable, high-quality DRI.
Executive Summary
Green Steel: an Opportunity Closer Than You Think
In the short term, Korea must import gas-based DRI—primarily from the Middle East, which offers the lowest cost and largest scale. Long term, hydrogen-based DRI will become essential, with Australia as a strategic partner thanks to cheap solar power and abundant ore.
DRI-EAF raises production costs by about 18%. To stay competitive, Korea must scale Carbon Contracts for Difference (CCfDs) and strengthen partnerships across key regions. Without timely action, Korea risks losing its place in the emerging green steel economy. Korea must secure gas-based DRI in the short term to stay competitive in the global green steel race.
※ This issue paper is a follow-up to Korea Net Zero Steel Roadmap II (KNZS II), published by NEXT group in October 2024.
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