The third-quarter operating profit of POSCO, Korean top steelmaker, fell 40 percent to 633 billion won ($598 million) on-year due to a slump in sales and a rise in raw material prices, the company said Oct. 24th, 2013.

POSCO’s revenue also dropped 4 percent to 15.2 trillion won in the third quarter from a year earlier.

According to market watchers, the average sales price of POSCO’s steel products dropped by 15,000 won per ton in the third quarter over the previous quarter, affecting the profitability of the world’s fifth-largest steelmaker.

The steelmaker’s profitability worsened in the third quarter as a price hike in steel products in the domestic market was delayed and the strong Korean won pushed up the price of steel exports.

Seasonal factors also had a negative impact on sales of steel projects in the third quarter, the company said. Demand for steel products traditionally falls during the summer session.

But POSCO expects its business performance to improve in the fourth quarter. Dongbu Securities forecast the firm’s revenue and operating profit are expected to increase 7 percent to 16.3 trillion won and 30 percent to 907 billion won, respectively, on-quarter.