Posted on 19 Feb 2019
Turkish steel exports may reach only 15 million-16 million tonnes in 2019, far short of their 2018 figure, according to Turkish Steel Exporters Association (CIB) chairman Adnan Aslan. Shipments abroad will be hampered by the continuation of protectionism around the world and a possible return by China to an “…aggressive” export policy.
Turkish steel exports to the US fell -15.1% on-year in 2018 to 1.9 million tonnes as a result of tariffs, while shipments to the Middle East declined -6% to 3.8mt. This was offset with increased exports to other regions. Shipments to Asia rose 34.8% to 1.7mt, with product sent to the Philippines and Sri Lanka for the first time. Overall exports rose 20.8% in 2018 to 21.4mt, increasing 36.1% in value to $15.6 billion.
In 2019 Turkish exporters will target Southeast Asia, West Africa and Latin America, organising trade delegations to countries that do not procure the desired tonnage of Turkish steel, Aslan says.
Turkish steel may be levied with a 50% tariff in the US, but this tax could be rescinded at any time, Aslan explains. US consumers are also victims of the tariff, as prices in the domestic market have consequently increased by 50% and US mills are making historic profits, he adds.
There is also a big question mark over China. The Asian giant exported less steel in 2018 due to improved domestic demand, but its economic growth forecasts are not promising and those exports could return. “If there is a contraction in the domestic market and they decide to export, there will be trouble for the whole world,” Aslan says in a note seen by Kallanish. “Over 100mt of exports will spell danger.”
Turkish exporters turned to East Asia, especially Singapore and Hong Kong, to offset reduced US-bound sales last year, but that could be difficult to replicate in 2019 if Chinese supply grows.
