Thailand’s government set out plans for new carbon taxes and an emissions trading system under the country’s first formal climate change legislation https://t.co/3HbvTtC37B ...

Financial Data and Key Metrics Changes - POSCO Holdings reported consolidated revenue of 17.3 trillion KRW and operating profit of 640 billion KRW for Q3 2025, showing improvement in operating profit for three consecutive quarters [1] - The operating profit margin for the quarter was recorded at 6.6%, driven by increased sales volume and cost-cutting efforts, despite a 1.7% drop in revenue compared to the previous quarter [1][8] - Operating profit for POSCO specifically was 585 billion KRW in Q3, reflecting a continuous recovery pattern from previous quarters [6] Business Line Data and Key Metrics Changes - In the steel sector, despite a decline in sales prices due to market saturation and increased imports, production volume increased by 4.9% [7][8] - In rechargeable battery materials, losses narrowed significantly quarter-over-quarter, with cathode sales volume nearly doubling due to the impending IRA benefit sunset [2][10] - POSCO E&C faced significant losses due to the Shenzhen line incident, with a one-time cost of 288.1 billion KRW recognized in Q3, and an additional 230 billion KRW expected in Q4 [10][49] Market Data and Key Metrics Changes - The domestic steel market in Korea is normalizing, but the company anticipates challenges due to reduced EU duty-free quotas and increased tariffs on steel products [1][9] - Overseas steel profits are expected to decline moderately, particularly in Mexico and India, while steady performance is anticipated in Indonesia and Vietnam [9][10] Company Strategy and Development Direction - The company is focused on ramping up new lithium plants and improving process efficiency, with a commitment to disciplined execution to avoid additional costs [2] - POSCO Group is implementing a comprehensive safety management plan to prevent future incidents and improve workplace safety [4][5] - The company is restructuring its portfolio, having completed 63 projects generating 1.4 trillion KRW in cash, and is prioritizing investments in high-growth markets such as the U.S. and India [6][25] Management Comments on Operating Environment and Future Outlook - Management expressed that while the current operating environment is complex, they expect to return to normal profitability levels in 2026 after accounting for one-off losses [3][10] - The outlook for the steel market in 2026 is positive, with anticipated overall profit increases compared to the current year [9] - Management highlighted the importance of adapting to changes in carbon-related costs and trade regulations, particularly the EU's Carbon Border Adjustment Mechanism [13][19] Other Important Information - The company is actively engaging in negotiations to secure more quotas in response to EU tariff increases and is adjusting its sales strategy to mitigate impacts from reduced quotas [47] - The company is also exploring potential M&A opportunities in sectors aligned with its long-term growth strategy [26] Q&A Session Summary Question: Steel market outlook for Q4 and impact of anti-dumping measures - Management indicated that the impact of anti-dumping measures would be difficult to assess immediately due to prior imports and expected seasonal demand fluctuations [16][17] Question: Response to EU Carbon Border Adjustment Mechanism - Management noted that while initial impacts may be minimal, costs are expected to rise in subsequent years, and they are developing guidelines to address these changes [18][19] Question: Investment plans and restructuring strategies - Management confirmed ongoing evaluations of investment opportunities in high-growth markets and emphasized the importance of maintaining competitiveness through facility upgrades and potential closures of underperforming assets [24][25] Question: Update on lithium operations and market demand - Management provided updates on the ramp-up of lithium operations, indicating that full operations are expected by early next year, with anticipated increases in demand driven by EVs [41][44]

Core Viewpoint - German chemical companies are expressing concerns that high carbon allowance costs are undermining Europe's competitiveness, prompting calls for adjustments in the emissions trading system to support struggling industries [1][3]. Group 1: Industry Concerns - Leading firms such as BASF SE and SKW Stickstoffwerke Piesteritz GmbH are advocating for exemptions in the emissions trading system as costs are expected to rise with the phase-out of free certificate allocations starting next year [1]. - The chairman of SKW Piesteritz highlighted that carbon prices in Europe are five times higher than in other regions, posing a significant threat to the industry's survival, even more so than previously high gas prices [2]. - The chemical sector is intensifying lobbying efforts against the EU's climate policies due to ongoing crises, with German chemical plants operating at only 72% capacity in Q2, marking the lowest level in over 30 years [3]. Group 2: Government and Policy Response - The German ruling coalition is supporting struggling industries, with Chancellor Friedrich Merz advocating for more flexibility in the EU's 2035 ban on new combustion-engine vehicles to aid automakers [4]. - The European Commission is working on enhancing the Carbon Border Adjustment Mechanism to protect domestic industries, but the current review will not address the chemical sector [4]. - BASF SE has stated that the existing carbon market scheme is detrimental to the competitiveness of energy-intensive basic material production in Europe, warning that failure to reform the CBAM could lead to increased relocation of emission-intensive production [5].