The European Commission’s proposal to grant Türkiye, among other partners, trusted partner status as part of the “Made in EU” mandate for various items, including electric vehicles, bodes well for Türkiye’s position in future EU steel trade negotiations. So says worldsteel chair and Turkish Steel Exporters’ Association vice president Uğur Dalbeler.
As announced by the Commission during its presentation of the Industrial Accelerator Act last week, the local content mandate will apply to aluminium, cement, electric vehicles and their components, batteries, battery energy storage systems (BESS), solar PV, heat pumps, wind, electrolysers, and nuclear technologies. It will not apply to steel, with the forthcoming steel trade regime, due to come into force from July, considered sufficient to restrict imports.
For the time being, Türkiye remains subject to EU safeguard quotas, with the long-term future of these measures uncertain, Dalbeler, also chief executive of Colakoglu Metalurji, tells Kallanish.
He argues that Türkiye should be assessed differently within the EU framework due to its deep economic integration with the bloc through the EU-Türkiye Customs Union and earlier arrangements linked to European coal and steel cooperation structures. Industry representatives are currently working with national authorities and seeking further engagement with the European Commission to advance discussions on a differentiated approach.
Dalbeler also raises concerns regarding how emerging EU carbon mechanisms evaluate Turkish steel production. Default emission values assigned to Türkiye appear significantly higher than those applied to countries such as Japan or South Korea. This is despite the fact that roughly 75% of Türkiye’s steel production is based on scrap-fed electric arc furnace technology, which is widely recognised as a lower-emission production route.
Closer cooperation between the EU and Türkiye could support Europe’s decarbonisation goals. While the EU has limited scrap-based flat steel capacity, Türkiye hosts several facilities capable of producing flat products using EAF technology. Producers such as Colakoglu, Tosyalı, and Habaş operate such facilities, although trade barriers and policy uncertainty often limit their ability to fully utilise capacities.
Dalbeler notes that expectations surrounding hydrogen-based steelmaking are gradually becoming more cautious. While hydrogen was initially presented as a key solution for decarbonising steel production, many policymakers now acknowledge it may not be scalable in the near term.
Renewable-energy-based solutions also face infrastructure constraints. As a result, iron ore-based production will continue to play an essential role in global steelmaking for the foreseeable future.
Rather than attempting to rapidly replace existing technologies, Dalbeler suggests the industry should prioritise reducing emissions within current production systems. Several Asian steelmakers are already pursuing this strategy by investing in technologies designed to lower emissions from blast furnace operations.
Another structural challenge is the limited global availability of high-quality scrap. Although EAF production is widely regarded as the most environmentally efficient steelmaking route, scrap supply remains insufficient to fully replace iron ore-based production.
Most scrap is already consumed in long steel production, both in Europe and globally. Flat steel production, particularly for manufacturing industries, therefore continues to rely heavily on iron ore.
Dalbeler also warns against the growing trend towards protectionist trade policies in the steel sector. Safeguard measures and tariffs have become increasingly common, even though such instruments were originally intended to be temporary under WTO rules.
Nevertheless, the current wave of protectionism may eventually normalise, as the economic consequences become clearer. Excessive protectionism can raise costs for downstream industries and contribute to inflation, which governments are simultaneously trying to control.
Industrial production has historically been based on specialisation and economies of scale, making full localisation of supply chains unrealistic.
Despite the challenges, discussions between Turkish industry representatives and European institutions are continuing. The aim is to ensure that Türkiye’s role as a major supplier of relatively low-emission steel to Europe is properly recognised within evolving EU industrial and climate policies.
“Türkiye and Europe are already deeply integrated. Recognising that reality would benefit both sides as the steel industry moves towards a lower-carbon future,” Dalbeler concludes.
