Rainfall hits Turkish Black Sea service centres, logistics

Heavy downpours have resulted in substantial damage to workplaces, houses and vehicles in several cities along the Black Sea coast of Turkey, with major mills Kardemir, Erdemir and Mescier nevertheless unaffected, according to market participants.

“The flood will affect the logistics operations because the Zonguldak-İstanbul and Zonguldak-Ankara highways have closed,” according to one participant.

On 9 July, the Disaster and Emergency Management Presidency (AFAD) of Turkey issued red alerts for 16 provinces nationwide to minimise the impact of severe rainfall, according to local media. The Zonguldak Eregli region was under water in a video published on the social media account of a trader and seen by Kallanish.

Crude steel producers were not affected, only warehouses, steel service centres and some re-rollers, according to market participants.

“There is a river at Ereğli which has some branch. Last weekend, it saw heavy rain and the dams overloaded; after that, the local authorities decided to open the dam gate. Then, near the river branch where many mills are located, the area came under water. Roads, houses, mills and steel service centres near the riverside are in the dangerous [zone] now. It will take 10-15 days for normal life to resume,” says one source.

There was no damage to the Mescier plant, but transportation is highly affected and vessels are unable to arrive at and exit ports, according to a market participant. Another source says those ports are used by small re-rollers in the Karabuk region, which mostly use them to import Russian billet and for limited export activity. No significant impact is expected on operations.

“There should be either no effect [from the flooding], or for a very short period, 1-2 days, after which it will settle,” a major producer source tells Kallanish.

“Cities and many villages are destroyed. I don’t know if something happened at the ports, but while cities and all their people are trying to survive there, we can’t expect a regular work flow, [including] in the ports,” a trading source observes.

“[Logistics operations in the] Karabuk region and local land roads are impacted; at the same time, there is not much effect on the steel market,” another trading source notes.

“Some steel service centre companies are affected, but we don’t know the full scale and possible effect at the moment,” a steel service centre representative opines.

“A few warehouses seem affected and I guess [affected material is] easily substitutable; all were commercial items,” a trader notes.

As of Monday, there was no impact on steel prices from the flooding damage. However, both flat and long steel prices were under pressure in general from last week’s semis price decrease by Kardemir and lower import prices, according to market participants.

Burcak Alpman Turkey , Elina Virchenko UAE