The spike in imports from Turkey to the European Union is putting some pressure on the domestic market. This needs to be monitored therefore, according to Jeroen Vermeij, head of market analysis and economic studies at Eurofer.
Currently Turkey is the main non-EU supplier of steel products to the continent, with some 726,000 tonnes/month on average sold during the first nine months of the year. The Turkish position is supported by a number of factors, including the difficulties generated in the Turkish steel sector following the decision by the US to double import tariffs to 50%.
“Turkey is clearly undercutting the EU market at the moment,” Vermeij said during a conference with members of the press in Bruxelles. “We do not know if the current prices are to be considered dumping [… below domestic Turkish levels], but there is a need to monitor.”
Turkish mills are currently competitive in the coil market, selling into South Europe at some €505-515/t ($/t) cfr (see Kallanish 24 October).
Market chatter suggests that the US could soon find an agreement with Turkey to reduce tariffs back to 25%, but despite this the Turkish sector is expected to continue to suffer.
Vermeij believes the return to a 25% tariff will re-open some opportunities for Turkish mills to export to the US, particularly long products. This alone however would not solve the deep problems within the Turkish steel industry. “Turkey needs to rebalance its domestic market rather than thinking about its exports,” he says. “The domino effect of the US tariffs was strong [… with measures applied in the EU, Canada etc.] Turkish mills are under pressure to export but the pressure will remain even if the the 50% will go back to 25%.”