Steelmakers globally will not welcome a planned iron ore joint venture announced last week by miners Rio Tinto PLC (RTP) and BHP Billiton Ltd. (BHP), the chief executive of South Korean steelmaker Posco (PKX) said Tuesday.

"The BHP-Rio joint venture is not positive for the steel industry and they (steelmakers) will oppose the proposed plan," Chung Joon-yang told reporters on the sidelines of an annual steel industry event.

His remarks follow a statement earlier Tuesday by the China Iron and Steel Association that said it strongly opposed the joint venture. "The joint venture agreement goes in the direction of a monopoly," the association said in a statement on its Web site.

The association suggested China should have a say in global iron ore trading as it is Australia's largest customer for iron ore exports.

Chung added that the second quarter will likely be the most difficult period this year for Posco, the world's fourth-largest steelmaker by output.

But the company expects steel demand to start to recover from the second half of this year, he said.

Posco's net profit in the first quarter fell by 69% to KRW325 billion from KRW1.031 trillion a year earlier due to weak demand and high costs.

Chung also said that the company continues to be in talks with BHP and Brazil's Vale S.A. (VALE) on iron ore prices. Chung added that he expects to conclude talks with BHP at price levels similar to those reached with Rio Tinto.

Rio Tinto, the world's second-largest producer of seaborne iron ore, recently finalized deals with Posco, Taiwanese steelmakers China Steel Corp. and Dragon Steel Corp. and Japan's Nippon Steel Corp. to cut 2009-10 iron prices by 33% to 44%.

Vale and BHP are the world's biggest and third-biggest producers of seaborne iron ore, respectively.

Chung added that Posco has no plans to acquire companies involved in raw materials for the industry for now.

-By Kyong-Ae Choi, Dow Jones Newswires; 822-2198-2236; kyong-ae.choi@dowjones.com