Earthquake hits steel production and exports

Data from the Turkish Steel Producers Association (TÇÜD) revealed the sharp drop in steel production and exports.

Turkey’s crude steel production decreased to 2.1 million tons in February with a decrease of 28.9 percent compared to the same month of the previous year, due to the earthquakes in Kahramanmaraşlı.

Crude steel production, in the first two months of the year, fell 23.1 percent to 4.7 million tons.

Finished steel consumption was recorded at 2.5 million tons in February, down 12 percent year-on-year, and at 5.5 million tons, down 7.7 percent in the January-February period.

47.3 PERCENT DECREASE IN STEEL PRODUCT EXPORTS

In February, exports of steel products fell to 675,000 tons, with a 47.3 percent annual decrease in quantity terms, and to 582 million dollars, with a 50.5 percent decrease in value terms.

In the January-February period, compared to the same period of the previous year, exports amounted to 1.4 million tons with a decrease of 44.9% in quantity, and 1.2 billion dollars in value with a loss of 49, 5 percent.

10.7 PERCENT DECREASE IN IMPORTS

In February, imports of steel products decreased 10.7 percent in quantity terms compared to the same month in 2022 and amounted to 1.3 million tons, and decreased 32 percent in value to $1 billion. .

In the first two months of the year, imports decreased to 2.5 million tons with a loss of 10 percent compared to the same period of the previous year, and to 2.1 billion dollars with a decrease in value of 27 percent.

The ratio of exports to imports, which was 80.1 percent in the January-February period of last year, decreased to 55.3 percent in the same period this year.

IT IS EXPECTED TO BE PARTIAL REPAIR FOR LOSSES

TÇÜD Secretary General Veysel Yayan, whose views are included in the statement, said: “As a result of production cuts at steel facilities, which have approximately 32 percent of TÇÜD’s crude steel production and production capacity, Turkey, located in the Iskenderun and Osmaniye regions due to the earthquakes that occurred in February, production decreased annually.

Emphasizing that the Turkish steel industry ranks 10th after Germany, Brazil and Iran, with 2 million 104 thousand tons of crude steel production, Yayan stated that exports fell by 45 percent in the first 2 months of the year due to that the negative impact of the increase in energy costs continued, despite the reductions made.

Stating that countries like Algeria and Egypt, which have comparative advantages in terms of natural gas, started to take part of Turkey’s export markets, Yayan made the following assessment:

“Should natural gas prices drop to European price levels, export losses are expected to be partially offset in the coming months by increasing our competitiveness and targeting new markets such as the Balkans, South America and Africa through trade delegation organizations.

RESPONSIBLE INCREASE IN IMPORTS FROM MALAYSIA, TAIWAN AND VIETNAM

On the other hand, Yayan pointed out that despite the 10 percent decline in imports, extraordinary increases in imports from countries like Malaysia, Taiwan and Vietnam caused great unrest in the steel industry.

Emphasizing that the postponement of the decision on import duties on flat steel products, which was previously postponed to April 1, this time to May 1, raised concerns that the deficit in foreign steel trade could grow furthermore, Yayan said:

“Starting in February, BOTAŞ reduced the wholesale prices of natural gas for large industrial establishments, announced that the reductions in natural gas tariffs used by industrialists would continue at the level of 20 percent, and that producers operating in the area production began after the earthquake. There are expectations that it will gradually improve from the beginning.

As a consequence of the growing demand for scrap, which is the raw material for steel products obtained through recycling in the field of green recycling, at the end of January EUROFER asked the EU to add scrap to the list of critical raw materials and India’s demand for scrap in the field of green recycling has gradually increased, so it is vital to take the necessary steps to ensure that our industry does not encounter problems in accessing scrap.”