POSCO International (047050) is winding down its rice milling operations in Myanmar after a decade, as the company divests low-profit non-core assets to focus on high-margin businesses including energy and Indonesian palm oil.
According to the company's consolidated audit report for fiscal year 2025 released on the 13th, Golden Rice POSCO International—the subsidiary operating rice processing complexes (RPC) in Myanmar—has been classified as an asset held for sale.
Golden Rice is a joint venture in which POSCO International holds a 60% stake, established for grain milling operations in Myanmar. In 2017, the company received investment approval from the Myanmar government to construct and operate RPC facilities that handle harvesting, drying, storage, milling, inspection, and sales of rice in an integrated process.
Despite being positioned as a vertically integrated food processing business handling everything from harvest to processing, expansion results were minimal. The subsidiary posted net losses of 6.5 billion won in 2024 and 900 million won last year without meaningful revenue.
"It was a subsidiary with negligible profits," POSCO International said. "We plan to sell the entire 60% stake."
Geopolitical risks also contributed to the withdrawal decision. Myanmar has experienced more than five years of civil war following the 2021 military coup, with worsening energy supply instability including frequent power outages. Given the difficulties in actively developing the business, POSCO International has been carrying Golden Rice at zero book value on its financial statements.
The company's payment guarantees of approximately 16.2 billion won for Golden Rice's borrowings have also been resolved with their maturity in 2025.
The exit aligns with the group-wide initiative led by POSCO Group Chairman Jang In-hwa to divest non-core assets. Since 2024, POSCO Group has been restructuring its business portfolio, aiming to generate 2.6 trillion won in cash by selling low-profit businesses and non-core assets.
"The company is focusing on energy and gas field operations as core businesses," a POSCO International spokesperson said. "This sale is part of streamlining non-core portfolios to concentrate on core assets."
In the food sector, POSCO International is redirecting resources from Myanmar rice milling to palm oil operations. The latest audit report shows that an Indonesian palm company acquired last year for approximately 1.3 trillion won has been newly included as a consolidated subsidiary.