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Türkiye is the 8th largest steel producer in the world and has surpassed Germany, leading in steel production in Europe. However, in the past two years, its steel production and exports output has continuously decreased due to global economic difficulties. However, Turkish steel companies continue to boost production capacity, promising an explosive growth in 2024.1. Türkiye's steel production situationAlthough Türkiye still maintains the 8th position in the ranking of the world's largest steel producers, 2023 marked the second consecutive year of decline in the steel industry. According to WorldSteel, Türkiye produced 33.7 million tons of steel (down 4% y/y) in 2023 and 35.1 million tons in 2022 (-12.9% y/y). The decline in steel production from 2022 to 2023 was due to macroeconomic instability and high inflation. The Turkish lira depreciated around 60% against the dollar in 2023 restricted steel imports and domestic steel consumption.Currently, most of the Turkish steel industry produces through electric arc furnace technology. In 2022, 71.5% of the domestic steel was produced from these furnaces, so the increase in electricity prices was also a factor that seriously affected the steel industry. According to the Confederation of Turkish Steelmakers (CIB), the sharp increase in electricity prices accounted for 27% of production costs compared to 8% in 2021.Other factors affecting steel production and consumption in Türkiye include the increase in VAT from 18% to 20%, leading to higher steel coil prices. The earthquake in February 2023 also negatively impacted the steel industry when 1/3 of factories were forced to suspend production.In 2023, coil steel consumption reached 38.1 million tons, an increase of 17.1% compared to 2022, leading to a 15.5% increase in steel imports compared to the same period in 2023  (According to the Turkish Steel Manufacturers Association (TCUD). 2. Türkiye's steel import and export situationTürkiye's steel exports in 2023 continued to decrease to 10.5 million tons, -30.6% y/y. Export revenue reached 8.3 billion USD, down 40.7% y/y. In 2022, steel exports only reached 15.1 million tons, down 23.5% over the same period last year.During January - November 2023 period, the EU imported an average of 199,000 tons of steel from Turkey per month. In 2022, Türkiye's imports of rolled steel products into Europe reached 4.33 million tons, accounting for 15% of the market share. Steel exports from Türkiye declined due to the following factors: High electricity prices in Türkiye reduce price competitiveness compared to other supply sources.The EU and US strengthen trade defense measures to protect domestic manufacturers against dumping. The US imposed a 25% tariff on Turkish steel products. Opportunities to export steel to the EU are limited by the quota system. In addition, the EU also applied anti-dumping duties on hot-rolled steel sheets imported from Türkiye.China increased exports of cheap steel due to a steel surplus. Russian suppliers offer low prices to attract importers. This negatively impacts prices and export opportunities of other countries.Thus, steel exports from Türkiye to the EU are decreasing. Manufacturers are losing price competition in the EU market. At the same time, Türkiye faces massive imports, forcing the government to take measures to protect the domestic market.In 2022, Türkiye imposed tariffs on hot rolled imports from the EU. In May 2023, import duties on some flat rolled products increased by an average of 7%, specifically hot rolled steel coils from 9% to 15%, cold rolled steel coils from 10% to 17%, steel coils from 9% to 15% and hot rolling alloy from 6% to 14%.Entering 2024, the trend of increasing trade protection is still going strong. In January, tariff rates on some flat-rolled products increased and continued to maintain tariff rates on imported rolled steel. In the near future, the government will also review anti-dumping measures on hot-rolled steel coils from China, Japan, India and the Russian Federation along with stainless steel pipes from China and Taiwan.3. Turkish steel industry outlook 2024Experts predict that the Turkish steel market will have many bright spots thanks to growing global steel demand. The World Steel Association forecasts that steel consumption in Türkiye will reach 40.6 million tons, an increase of 5% by 2024.According to the Turkish Steel Association (TCUD), steel output in January 2024 reached 3.2 million tons, up 24.7% over the same period and flat steel consumption increased by 33.6% over the same period. The figures for February are even more positive.Manufacturers Kardemir, Yıldız, Colakoglu Metalurji, Hasçelik have planned to invest millions of dollars to increase production capacity in 2024.Türkiye has a large and growing domestic market, so the future of the steel industry will be based on meeting domestic demand. In addition, Türkiye has deployed steel production technology from CBAM scrap, providing advantages for exporting to the EU market.

Turkey is planning an expansion to enhance its steel production capacity, aiming to lead Europe in the coming years.Turkey holds a prominent position in the global steel production and export market. The country's steel industry has gained recognition for manufacturing high-quality steel products and making continuous efforts to expand its capacity while incorporating advanced technologies into production. With its strategic geographical location, including an extensive Mediterranean coastline, Turkey currently produces and supplies steel primarily to the European market.The steel industry in Turkey comprises privately owned companies that continually strive for technological advancements and competitiveness in the market. The iron and steel sector is the third-largest contributor to the Turkish economy, reflecting significant development in recent years. Presently, Turkey ranks among the top 10 largest steel production countries globally. According to the World Steel Association (WSA), Turkey was the 8th-largest producer of crude steel in the world in 2022, with 35.134 million metric tons of crude steel. However, in 2023, due to the impact of an earthquake, one-third of Turkey's steel production plants had to temporarily halt steel production activities. It is known that in the last 5 years, Turkey has averaged exporting around 20 million tons of steel annually worldwide. In 2021, according to data from the World Steel Association (WSA), Turkey’s steel industry exported 22.1 million tons of steel, ranking as the 7th largest steel exporter globally. In 2022, according to the Turkish Steel Exporters' Association (CIB), Turkey's steel exports decreased to 19.6 million tons. While Turkey's steel exports increased in the first six months of 2022, they sharply declined in the second half of the year. According to the CIB, the total volume of Turkey's steel exports decreased by about 50% in the fourth quarter of 2022 compared to the same period in 2021. The main reasons for this decline are primarily attributed to the impact of the Ukraine conflict, inflation, high energy prices, and a global decrease in steel consumption. Particularly, the demand for steel imports from Europe has significantly reduced, while the EU has accounted for approximately 30% of Turkey's steel industry total steel export volume in the past 5 years.Therefore, recently, Turkey has set the goal of becoming the leading country in steel production within the EU in the near future. Alongside efforts to achieve the set objectives, the Director-General of the European Steel Association (EUROFER) emphasizes the challenges that the Turkish steel industry must confront, especially in the face of an energy crisis, high production costs, and inflation, which have added difficulties to steel manufacturing. Furthermore, the transition to carbon reduction processes is underway, and accessing non-fossil fuel energy at affordable prices is crucial for the Turkish steel industry to maintain global competitiveness. The President of the Union of Chambers and Commodity Exchanges of Turkey (TOBB) stated that the application of protective measures for steel products could allow the full utilization of domestic capacity, enhance export opportunities and contribute to reducing the steel industry's deficit. Additionally, it is seen as an opportunity to generate added value and provide additional employment within the country. Moreover, there is hope that Turkey's steel industry will regain its position as the largest steel producer in the Middle East, with strategic steps planned for 2024 and even stronger growth expected in 2025. Alongside these aspirations, Turkey's long-term goal is to catch up with South Korea and become the world's 6th-largest steel-producing country.

Türkiye, one of the key economies in the Eastern and Middle Eastern region, has recently announced a 20% increase in electricity prices since the beginning of October. This decision not only affects daily life but also directly impacts the steel industry of the country.Cause of price increaseAlthough the specific reasons for the price increase have not been officially announced, many experts believe that the significant rise in oil, natural gas, and other energy sources has had a profound impact on the national economy, leading to Türkiye's decision to increase electricity prices by 20%. Additionally, Türkiye heavily relies on energy imports from other countries, making it susceptible to fluctuations in international market prices. The electricity price hike not only affects Türkiye's economy but also has a direct impact on its steel industry.Reaction from public opinion and business circlesThe electricity price increase is indeed creating significant financial pressure for households and businesses in Türkiye. Many citizens are worried that the new pricing levels will raise living expenses and reduce their consumption capacity. For businesses, especially those in energy-intensive sectors like the steel industry, the electricity price hike will result in higher production costs, affecting product prices and their competitiveness in the market.In a series of consecutive economic events, the increase in electricity prices has generated a ripple effect, with the most noteworthy being the surge in steel prices. Steel production is one of the energy-intensive industries. According to reports, the steel industry typically accounts for a significant portion of total electricity consumption in many countries. Therefore, any fluctuations in electricity prices have the potential to directly impact steel production costs. Consequently, Türkiye's decision to raise electricity prices is also adding pressure to the country's steel industry.Currently, steel manufacturers in Türkiye are facing difficulties in exporting steel due to non-competitive prices compared to global market competitors. Furthermore, alongside the increase in electricity prices in Türkiye, the domestic steel industry will once again have to grapple with the pressure of rising steel prices. When electricity prices rise, the energy costs for steel production also increase, leading to higher production costs for steel. Coupled with the decreasing global demand for steel and stable scrap metal prices, this could exacerbate export challenges for domestically manufactured steel products.Future prospectsWith the significant increase in electricity prices, the Government of Türkiye has promised to implement support measures to alleviate the financial burden on citizens and businesses. However, some economic experts argue that adjusting electricity prices is necessary to ensure the stability of the energy supply and the long-term sustainability of the economy.The higher electricity prices could indeed incentivize steel companies to seek energy-saving solutions, adopt new technologies, and improve their production processes to mitigate the impact of electricity costs. The Türkiye steel industry may explore investments in and the adoption of alternative energy sources, such as renewable energy or nuclear energy, to address this challenge. These measures can not only help reduce the industry's reliance on expensive electricity but also contribute to sustainability and environmental goals.Although the high electricity prices create pressure on Türkiye's steel industry, they also present opportunities for innovation and optimization. By continuing to invest in technology, improving efficiency, and exploring alternative energy sources, the Türkiye steel sector can overcome these challenges and continue to grow robustly in the future. Adaptation and forward-thinking strategies can lead to a more sustainable and competitive industry.Here is the information that MRS Steel has provided to you regarding Türkiye's 20% electricity price increase. The electricity price hike not only affects daily life but also directly impacts the country's steel industry. If you have any questions or inquiries about the article, please feel free to contact us, and we will be happy to assist.

Turkey's Central Bank recently unexpectedly increased interest rate from 17.% to 25% at the end of August, which led to a rise in the Turkish lira. The event has directly affected the Turkish long steel market due to the buyers' wait for exchange rates to settle and competitive pressure from the export market.The hike in interest rates has an impact on the Turkish long steel marketThe recent decision by the Central Bank of Turkey on August 24 to unexpectedly raise the interest rate for loans from 17.5% to 25% has sent shockwaves through the country. This decision was a departure from the previous strategy of keeping interest rates low despite high inflation. The increase in interest rates has led to a significant appreciation of the Turkish lira compared to other currencies, disrupting steel trading activities in the domestic market.Before the central bank's interest rate hike, many steel suppliers in Turkey had proactively reduced their prices to liquidate inventory, while others temporarily halted sales operations to await exchange rate stability. According to Kallanish, long steel producers in Turkey struggle to generate revenue in the domestic and export markets due to buyer tendencies to wait for lower prices. Consequently, they have been forced to lower product prices despite the stability of scrap steel prices.Since September 7, the price of long steel on the market has dropped to 565 - 580 USD/ton while last week, this price was at 580 USD - 590 USD/ton. In the export market, Turkey's official rebar steel prices from August 24 to September 1 were mainly in the range of 580 - 590 USD per ton, representing an approximately 20% increase compared to the previous week's 570-580 USD per ton.The trade balance instability in Turkey in the first half of 2023The increasing price disparity between Turkish steel and its competitors in the international market has contributed to a significant decline in export volumes in this country in the first half of 2023. Specifically, in the first six months of 2023, Turkey's steel export volume reached 4.5 million tons and decreased by more than 40% compared to the same period last year. The country's steel manufacturers expect oil and gas pipeline conglomerates to maintain or reduce natural gas prices to reduce pressure on input material costs, thereby increasing their competitiveness in the export market.Conversely, steel imports in this country have increased by 23% in the first half of this year, with an import volume of 9.5 million tons. According to the Turkish Steel Producers Association (TCUD), the rapid increase in domestic demand is mainly due to infrastructure reconstruction after the earthquake event in January. In the first six months of 2023, long steel imports increased by 43.5%, and wire rod steel imports surged by 82.5%. Turkey has been considered a net steel exporter but the continuous importation of long steel in recent months has raised concerns about trade deficits.The Turkish Steel Producers Association (TCUD) stated that several countries have significantly increased their steel market share in the domestic market, creating direct competition for domestic producers. Typical countries include China, India, South Korea, and Indonesia. The association is currently considering future trade defense measures to prevent the increasing importation of steel products.In the face of the sharp increase in steel imports from Turkey, Vietnam's steel industry has benefited significantly. In the first quarter of 2023, Vietnam's steel export volume experienced a remarkable increase of more than 300 times compared to the same period. However, since the second quarter, Vietnam has been more proactive in preparing for trade defense risks through fair competition and effective control of imported steel volumes to maintain stable trade relations between the two countries. 

After experiencing severe earthquake damage in February, Turkiye has begun to increase steel imports to rebuild infrastructure quickly. In the first 3 months of the year, Turkiye became the world's No. 1 net importer with a trade deficit of 55%.1. Türkiye increased steel imports to rebuild infrastructureAccording to data from the Turkiye Steel Manufacturers Association, the ratio of steel exports to imports here has fallen to 55%. The reason for the significant difference between export and import volume comes from the government's policy of postponing the date increase in import tax on flat steel products on February 26, 2023.Many sources say the delay will last until April 1, 2023. Turkiye steel producers met with the Ministry of Industry and Trade to discuss a plan to supply steel for construction reconstruction and rebuilding destroyed cities. Customs duties on the hot rolled coil (HRC), cold rolled coil, and galvanized steel will be increased from 6-7% to 15%, 17%, and 20% respectively.The manufacturers' association is worried that this extending delay in import tax increases will imbalance imports and exports and slow the recovery of exports. In addition, construction steel prices in Turkiye have shown signs of increasing uncontrollably because many factories here have suffered severe damage after the earthquake, leading to domestic supply not meeting the demand for reconstruction.2. Vietnam steel exports to Turkiye in the first 3 months of 2023Following the trend of increasing steel imports from Turkiye, Vietnam also benefits from a part of the total volume of Turkiye steel imports. According to data from the General Department of Customs, in the first quarter of 2023, Vietnam exported 104,000 tons of steel, and this value increased 386 times over the same period last year.Specifically, in the top of Vietnam's main steel export markets after the first two months of the year, Turkiye first participated with a total market share of 10%. The Vietnam High Commissioner in Turkiye said the earthquake had crippled the steel factory system here, but it would not significantly affect the import-export situation between the two countries. Turkiye accounts for 10% of the total steel export market share in the first 2 months in 2023It is expected that Turkiye will have to spend about 120 billion euros within 5 years to be able to rebuild the construction works in the country including 750,000 tons of coil and 1.25 million tons of steel plate. The reconstruction needs of Turkiye will be an essential mark to help Vietnamese steel enterprises further promote their steel export plans, contributing to removing difficulties in consumption when Vietnam's steel demand is weak. 

The trade tensions continued to be a hot topic when Turkey recently imposed an anti-dumping duty on HRC products from the EU and Korea. This decision is seen as retaliation from Turkey based on the fact that their country's HRC source was previously taxed by Europe.The overview of imposing anti-dumping HRCSince January 2021, the Turkish has started an anti-dumping investigation on hot rolled coils imported from the EU and Korea. The investigation was initiated by requirements from the Turkish Steel Association on behalf of domestic steel producers.Hot rolled coil products in the investigation list have codes including 7208.10.00, 7208.25.00, 7208.26.00, 7208.27.00, 7208.36.00, 7208.37.00, 7208.38.00, 7208.39 .00, 7208.40.00, 7208.52.908, 7208.52.908, 7208.52.10, 7208.53.10, 7208.53.90, 7208.54.00, 7211.13.00, 7211.14.00, 7211.19.00, 7212.60.00, 7225.19.10, 7225.30.10, 7225.30.30, 7225.90. .90, 7226.91.20, 7226.91.91 and 7226.91.99In March 2022, the government announced the results of the investigation after a long time for reviewing. Accordingly, HRC importers from the EU and Korea were found to be selling HRC products at a lower price than the floor price in domestic. The Turkish Ministry of Commerce has calculated that the dumping margin of Korean importers ranges from 14 to 18.6%, especially for European HRC steel importers who have been accused of dumping with a margin of high in the range of 23-49%.On July 7, 2022, in the face of arguments about unfair competition, the Turkish Ministry of Commerce decided to impose an anti-dumping duty on importers from the EU and Korea. The tax rate will be calculated in the range of 7-18.8% for HRC products from Europe and 7-8.95% for HRC products originating from Korea.What is the cause of escalating tension? "What we have been doing is a proper answer for the EU after everything they have done to Turkey in the past four years," the Turkish Steel Association vice president declared.In addition, he also said that the imposition of the tax would be an essential step to prevent unfair trade between domestic and foreign manufacturers.Turkey is one of the largest export markets for the EU, and they often look to this country as a solution to eliminating the inventory situation when the demand for steel in the European region is significantly reduced. EU producers have been accused of regularly selling large shipments of steel to Turkish users at lower prices than the prices in Europe, specifically a large factory in France sold steel in Turkey for about €750/ton, while the domestic price is much more expensive with a specific price above €900/tons.Although the imposition of an anti-dumping tax has the participation of the EU and South Korea, this is actually seen as a response from the Turkish manufacturers to the EU since the case of anti-dumping duties on HRC products from Turkey in January 2021.Vietnam's Perspective Before Recent Anti-Dumping LawsuitsAs of 2023, Turkey will always be a potential steel export market for Vietnamese suppliers. The trading relationships become significant in the context of steel demand in Turkey increasing sharply to serve the reconstruction of construction structures after the earthquake in January.Although Turkey has previously initiated an anti-dumping investigation on stainless steel pipes from Vietnam, the Turkish Ministry of Industry and Trade has not yet made a final decision on this matter. It can be seen that commercial cooperation between the two countries has always maintained a stable status based on bilateral interests.Particularly for HRC products, Vietnam is considered one of the most potent steel manufacturers with annual output of HRC steel reaching more than 8.6 million tons. Thanks to strong production capacity and technological advances, Vietnam has been able to supply and export HRC worldwide. In just 6 months of 2021, Vietnam's HRC export volume has reached 700,000 tons.