POSCO Int'l, NongHyup to team up for feed supply chain

South Korea's POSCO International Corp. announced on Tuesday that it will collaborate with the largest domestic feed company NongHyup Feed to stabilize the feed supply chain. 

This is the second business cooperation following the business agreement for stable procurement of imported feed that was signed in November last year.

Under this agreement, the two companies will utilize POSCO International's overseas elevators to import grains and have entered into long-term supply contracts for feed ingredients such as palm kernel cake.

They also agreed to jointly develop and invest in overseas grain businesses and collaborate on information exchange using POSCO International's global network.

In addition, the companies plan to explore solutions for expanding the import of Ukrainian grains, which has become challenging since the suspension of the Black Sea grain agreement in Russia in August.

POSCO International is currently pursuing investments in a Ukrainian grain terminal, an Indonesian palm farm, and a rice processing factory in Myanmar. The latest agreement secures distribution channels to supply primary raw materials for feed, such as soybean meal, in addition to existing grains and palm kernel cake.

NongHyup Feed anticipates positive effects in terms of increased negotiating power with major global food companies and expects positive impacts on the country's price stability and food security.

POSCO International aims to become a world top-10 major grain company with an eco-friendly agricultural base, planning to handle 860,000 hectares of cultivation area, with production amounts of 7.1 million tons and processing quantities of 2.34 million tons by 2030.

Write to Mi-Sun Kang at misunny@hankyung.com