Korea's shipping industry urges POSCO to abandon bid for HMM

SEOUL, October 13 (AJP) - South Korea’s shipping industry is pushing back against steel giant POSCO Group’s reported plan to acquire HMM, the nation’s largest container carrier, warning that such a move could destabilize the sector and undermine decades of maritime expertise.

The Korea Shipping Association said in a statement on Monday that it had submitted a formal letter to POSCO Chairman Jang In-hwa, urging the company to withdraw from the bidding process.

The group argued that allowing a non-shipping conglomerate to take control of a key maritime operator would weaken the industry’s competitiveness and expose it to unnecessary risks.

“The acquisition could erode the professional management of shipping operations and threaten stability if POSCO were to face financial difficulties,” the association said. It added that the global trend among major carriers is toward consolidation and specialization, not diversification by industrial groups with limited maritime experience.

The association pointed to POSCO’s previous attempt to enter the shipping business through Geo Yang Shipping, which ended in failure and was later sold to the now-defunct Hanjin Shipping. It also cited Brazilian mining giant Vale’s retreat from the sector after selling its fleet of large bulk carriers, saying such examples underscore the challenges faced by non-shipping firms.

Industry experts note that HMM, which was rescued by state-led creditors in the aftermath of Hanjin’s 2017 collapse, remains a strategic asset for South Korea’s trade-dependent economy. Critics fear that turning it over to an industrial buyer could distort market dynamics and weaken the country’s maritime resilience.

The shipping association further argued that POSCO’s acquisition would do little to reduce logistics costs and could instead “disrupt the nation’s shipping ecosystem and harm the import-export industry.”

POSCO has not yet commented on the association’s appeal.

* This article, published by Aju Business Daily, was translated by AI and edited by AJP.

Copyright ⓒ Aju Press All rights reserved.