Ukraine war concerns Turkish steelmakers

Turkish steelmakers are concerned that the continuation of the war in Ukraine will cause difficulties with raw materials supply to Turkey.

“Although our country has come to the forefront as one of the countries that will benefit most from the new quota distribution as a result of the EU sanctions after Russia’s invasion of Ukraine,  there is a concern that the negative impact of the invasion on our steel production will reach serious levels as main raw materials such as scrap, anthracite, ferro silico manganese and pig iron are mostly imported from Ukraine and Russia,” says Turkish Steel Producers’ Association (TCUD) general secretary Veysel Yayan.

TCUD expects the decline in imports of raw materials and semi-products to more clearly reveal its impact on March indicators.

“The fact that the ships carrying cargo to this region are not insured, due to the Black Sea being declared a risky region, is another important source of problems Turkish producers are facing,” says Yayan.

Turkey’s February crude steel production fell 3.3% on-year to 3 million tonnes, while two-month production declined 5.7% to 6.1mt.

February finished steel consumption rose 1.9% to 2.9mt, Kallanish notes. In January-February, however, it fell 1.2% to 5.9mt.

January exports of steel products grew 1.3% to 1.3mt and increased 46.5% in value to $1.2 billion. Two-month exports rose 2% to 2.6mt, and by 52.4% to $2.4 billion.

Imports rose 12.9% on-year to 1.4mt, and by 76.3% to $1.5 billion. January-February imports grew 13.8% to 2.8mt, and by 67.6% to $2.9 billion.

The ratio of exports to imports declined to 80.8:100 in January-February from 88.9:100 last year due to the significant rise in imports.

Yayan also noted that production fell for three consecutive months including December 2021 and scrap imports from Russia and Ukraine, which are Turkey’s important scrap suppliers, decreased significantly in February due to the high tax on scrap exports and partly due to the war that started on February 24. Turkey’s scrap imports from Russia decreased by 96.6% from 160,000 tonnes to 5,000t, and imports from Ukraine decreased from 17,000t to 2,000t.

Burcak Alpman Turkey