Seoul  - South Korea's largest steelmaker is engaged in talks to import iron ore and coal from North Korea, the steelmaker said on Wednesday.

The country's largest steelmaker, Pohang Steel & Iron Co (POSCO), said Kim Dong-Jin, CEO of its Chinese subsidiary POSCO China, will visit North Korea at the invitation of North Korea's committee for the inter-Korean economic cooperation.

"During his visit, he will be talk with his North Korean counterpart to sound out the chances of importing iron ore," a company statement said.

Compared with one year ago, POSCO is paying at least 65 per cent more for iron ore from Australia, Brazil, India, Chile and Canada.

POSCO has recently passed on part of the cost increase in the form of higher prices for its end-users like South Korean carmakers and shipbuilders.

As a result, South Korean carmakers will pay an additional 150 US dollars for steel materials to make one car.

Meanwhile, North Korea is known to sit on total reserves of 3 billion tons of iron ore, 1.3 billion tons of which are estimated to be actually available for excavation.

POSCO has imported about 200,000 tons of coal from North Korea a year for the past two years. "Talks are underway with North Korea to double the import volume of coal," the POSCO spokesman says.

The coal price has almost tripled from 98 US dollars per ton to 300 US dollars under the April contract between POSCO and coal suppliers in Australia. (dpa)