Wire rods are stacked in a Posco facility. (Posco Group)

South Korea's leading steelmaker, Posco, said Tuesday it shut down a wire rod mill in its factory in the southeastern city of Pohang in an effort to boost profitability and managerial efficiency.

The Unit 1 wire rod mill at the Pohang factory, 273 kilometers southeast of Seoul, was brought to an end in the day after more than 45 years of operation, according to the steelmaker.

The shutdown decision was made due to the heated competition and oversupply in the global wire rod market from cheap Chinese steel products, as well as its decrepit facility, Posco added.

Posco has four wire rod mills at the Pohang factory, including the closed one.

"We've seen an influx of cheap foreign wire rod products in the domestic market, which has brought down market prices. Given such conditions and the competitiveness of the old facilities, we've decided to reduce supplies of low-priced items," a company official said.

Wire rod is a rolled steel product manufactured from semi-finished steel and is used for a range of applications from vehicles to construction materials.

Since opening in February 1979, the unit had produced 28 million tons of wire rod products, the company said.

The shutdown came three months after Posco halted operations at one of its three steel mills at the Pohang factory as the steelmaker is struggling to enhance profitability. (Yonhap)