Economic sanctions imposed on Russia by different countries, particularly the European Union, due to the war in Ukraine have changed the balances in the global iron and steel sectors and Turkey could fill the gap left in the EU, according to Erhan Ozdemir, vice general manager of Yildiz Demir Celik, one of Turkey’s largest coated coil producers.Highlighting that Russia had been one of the EU’s largest steel suppliers, Ozdemir said in a statement that EU buyers were having to focus on different regions to meet their steel demand.
“Turkey has come into prominence in this environment, as one of the important business partners of the EU. This could contribute to Turkish mills’ steel exports to the region, especially in flat steel,” he said.
Pointing out that Russia was a key hot-rolled coil and coated coil supplier at 2.14 million mt and 368,000 mt respectively, Ozdemir said Turkey could fill this gap.
“As Turkey is a large producer of these steel products, the crisis will not have a negative effect on the Turkish steel sector, instead it will raise our export volumes,” he said.
Turkish mills’ flat steel prices rose by more than $300/mt since the start of the Russian invasion on Feb. 24, in line with the sharp rise seen in energy and scrap costs, as the supply chain from the CIS region collapsed.
S&P Global Commodity Insights’ weekly assessment for Turkish domestic HRC was at $1,290/mt EXW on April 8, while assessment for Turkish domestic HDG was at $1,385/mt EXW.
Highlighting that Yildiz Demir Çelik reached a high export tonnage in the last three years, Ozdemir said the Turkish steel sector had a chance to fill the gap in the sector, as new balances in the global steel sector had been at an establishment phase.
“As Yildiz Demir Celik, we are continuing our production and investments without slowing down in this environment,” he said.
Yildiz Demir Celik’s cold-rolling mill complex in Kocaeli, western Turkey, started production on its new continuous pickling tandem line in late 2019, with a capacity of 1.5 million mt/year.
The company currently has production capacity of 400,000 mt/year for HDG coil and 150,000 mt/year for pre-painted galvanized iron, as well as 300,000 m/year of cold-rolled coil.
The company is targeting 900,000 mt/year of galvanizing capacity with a new line to be started in the second quarter of 2022.
Yildiz Demir Celik is also planning to start HRC production in the coming three years by building a melt shop with a liquid steel capacity of 4 million mt and a hot-rolling mill with a finished product capacity of 3.5 million mt, following the approval of the company’s project on environmental basis by the Ministry of Environment and Urbanization.
— Cenk Can