POSCO has developed a bismuth-added free-cutting steel as it seeks a high-efficient, better-performing and eco-friendly substitute for leaded steel, the steel mill said Sunday.

Free-cutting steel is used for heavily machined components, such as car engine parts and electronics devices.

Bismuth steel has emerged as a potential alternative to leaded steel, which is used to make free-cutting steel easier to cut at a high level of precision and speed. The toxicity of lead has elevated health and environmental concerns in recent years.

The world’s fourth-largest steelmaker said it has been working on the project since 2005 in efforts to improve health conditions for workers and cope with tightening environmental regulations at home and abroad.

“The new material will significantly perk up the company’s profitability,” a POSCO official said, citing its higher prices and growing demand for low-carbon, lead-free steel around the world.

POSCO estimates the global market for the special steel at 1.5 million metric tons. Korea imports all its free cutting steel, about 35,000 metric tons.

The Pohang-based company said it began supplying the latest product in August to LG Electronics for television components. It recently obtained a material certificate from Hyundai Motor Group, its biggest client, and is working on one with Samsung Electronics.

By Shin Hyon-hee (heeshin@heraldcorp.com)