According to Yalçın Ertan, Chairman of the Board of Directors of the Aegean Iron and Non-Ferrous Metal Exporters Association (EİB), delays in the Suez Canal have made it difficult for Asian producers to ship steel to the EU, boosting Turkish producers' competitiveness.
In the first half of 2024, Türkiye's total steel exports increased by 31% to 8.8 million mt. This increase is attributed primarily to rising demand for flat steel, especially, and high shipments to the EU.
However, Ertan stressed that economic conditions in the domestic market continue to suppress the profitability of the Turkish steel sector. High input costs, inflation and low exchange rate policy are creating major challenges for producers. According to Turkish industrial sources, the electricity tariff increases that came into effect on July 1st added a USD 10/mt increase to steel production costs.
"Although we are starting to regain market share in the EU region, economic conditions in the domestic market continue to suppress our margins and profitability," said Ertan, pointing to high input costs, inflation and low exchange rate policy.
Ertan stated that Turkish producers need to increase their investments to comply with the EU's Green Deal. He also stressed that the planned adjustments in the inward processing regime should not weaken producers' competitiveness.
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