Turkish steel mills managed to raise exports in the first half of 2024, as Asian mills, their top rivals in the European market, faced challenges passing through the Suez Canal due to the conflict in the Red Sea, Egean Ferrous and Non-ferrous Metal Exporters’ Association (EIB) Chairman Yalcin Ertan said.
“Due to the security challenges in the Red Sea route, passes from the Suez Canal fell substantially and the delivery times from China to the EU more than doubled to 65-70 days,” he said in a late July 19 statement, adding that freight rates also doubled since the start of the year.
Turkey’s overall steel exports, particularly flat steel, increased 31% year on year to 8.8 million mt in H1, due to increased competitive power and higher shipments to the EU, he said.
“Although we have begun to regain our market shares in the EU region, economic conditions in the domestic market continued to pressure our margins and profitability,” Ertan said, citing high input costs, inflation and a low exchange rate policy.
Electricity tariff hikes came into effect on July 1, adding around $10/mt in cost increases to steel production, according to Turkish industry sources.
Ertan called for Turkish mills to increase investments to comply with the EU’s Green Deal, saying the Turkish government’s expected regulation in the inward processing regime should not erode mills’ competitive power.
Platts, part of S&P Global Commodity Insights, assessed Turkish domestic hot-rolled coil at $575/mt EXW July 19, down 19% decline since the start of 2024.