Pohang: South Korea’s leading steelmaker, POSCO, announced on Tuesday the closure of a wire rod mill at its factory in the southeastern city of Pohang. This strategic move aims to improve profitability and enhance managerial efficiency within the company.

According to Yonhap News Agency, the Unit 1 wire rod mill at the Pohang factory, located 273 kilometers southeast of Seoul, ceased operations after more than 45 years of production. This decision was influenced by fierce competition and an oversupply in the global wire rod market, primarily driven by inexpensive Chinese steel products. Additionally, the aging facility was no longer deemed competitive, prompting the shutdown.

POSCO operates four wire rod mills at the Pohang site, including the one that has been closed. The company released a photo showing officials marking the occasion of the shutdown on November 19, 2024.

A company official stated, “We’ve seen an influx of cheap foreign wire rod products in the domestic market, which has brought down mark
et prices. Given such conditions and the competitiveness of the old facilities, we’ve decided to reduce supplies of low-priced items.”

Wire rod, a rolled steel product derived from semi-finished steel, is utilized in various applications ranging from vehicles to construction materials. Since its inception in February 1979, the Unit 1 mill had produced a total of 28 million tons of wire rod products.

The recent closure follows POSCO’s decision three months ago to halt operations at one of its three steel mills at the Pohang factory, reflecting the company’s ongoing efforts to strengthen profitability amidst challenging market conditions.