POSCO, South Korea's biggest steelmaker, said Friday it will spend 2.8 trillion won (US$2.38 billion) by 2018 to advance its processing and recycling technologies for rare metals such as magnesium .

As an initial step, the steelmaker plans to spend 35 billion won to build a magnesium-processing plant in South Korea that will churn out 10,000 tons of the metal annually. POSCO plans to process 100,000 tons per year after 2014.

Demand for rare metals used in liquid-crystal displays and autos is rising, but resource-poor South Korea has few reserves.

Also Friday, the Ministry of Knowledge Economy said the government will invest 300 billion won between now and 2018 into rare-metals technology, aiming to process 80 per cent of the raw metals it consumes from the current 12 per cent.

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