Posted on 01 Jun 2023
Turkish steel producers have reiterated their calls for multi-faceted measures that will increase the competitiveness of the Turkish steel industry.
“Considering the fact the capacity of the sector has doubled over domestic consumption, in order to re-establish the deteriorated balance and to support the closing of the foreign trade deficit – at least to previous levels – necessary measures, similar to those in the USA and the EU, should be taken and imports should be brought under control,” says Turkish Steel Producers Association (TCUD) general secretary Veysel Yayan.
He notes the priority should be the restriction on imports within the scope of the Inward Processing Regime and imports of products with sufficient domestic production capacity.
Turkey’s April crude steel production decreased 20.6% on-year to 2.7 million tonnes.
Due to the temporary suspension in February of mills in the earthquake-hit region, the decline in exports and domestic buyers’ redirection to imports, four-month production fell 21.3% on-year to 10.1mt. This caused Turkey’s steel industry to fall to tenth place in the global output ranking, notes Kallanish.
April finished steel consumption rose 16.2% on-year to 3.5mt, while January-April consumption increased by 7.9% to 12.5mt.
Exports of steel products, however, slumped 55.2% in April to 629,900t, while falling 59.9% in value to $566.4 million. Four-month exports fell 50.1% to 2.8mt and 53.8% to $2.5 billion.
April imports rose 30.4% to 1.7mt while falling 0.2% in value to $1.4 billion. January-April imports thus rose 11.9% to 5.9mt while declining by 12.6% in value to $4.9 billion.
“Imports increased to a great extent due to the fact that Far Eastern countries, which have advantages in input costs, turned to our market. Domestic consumption, which increased by 25% on average in the last two months and by 8% in the first four months of the year, was met by imports, causing great discomfort,” says Yayan.
The ratio of four-month exports to imports slumped to 49.8:100 from 94.3:100 in January-April 2022, clearly proving the negative trend in steel foreign trade.
“Despite the gradual decreases in energy prices since December 2022, factors such as the multi-faceted support provided by EU countries to energy-intensive sectors, pressured exchange rates since August, the continued implementation of protective measures and the contraction in demand in the global market, led to an extraordinary decline in our steel exports,” says Yayan.
The high spread in the foreign exchange buy and sell prices created additional costs for exporters and became another important factor that negatively affected their competitiveness, he adds.
Source:Kallanish
