Turkish exports rise 11.6% in July as product prices fall

Turkey’s steel exports in July rose by 11.6% year-on-year, though the fall in steel prices was evident as the consequent growth in revenue was just a fraction of this increase.

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The country exported 1.6 million tonnes, with a combined value just 2.6% higher at $1.4 billion, new figures from the Istanbul Minerals & Metals Exporters Assn show.

Overseas sales of hot dipped galvanized flat products more than tripled to 76,000 tonnes in the month, leading the rise in export growth.

Billet exports rose by 53.5% to 285,000 tonnes while exports of structural steel, tubes and pipes, and rebar all rose by around one-third.

Profiles exports rose by 9.8% to 154,000 tonnes.

Exports of other products decreased in comparison with last year, however. Hot rolled flat products were down by more than 77% to 41,000 tonnes, with wire rod down by more than 34% to 77,000 tonnes.

Increased efficiency
“Turkey’s poor natural resources have forced us to increase our productivity and efficiency,” a source close to the association said. “Otherwise, we cannot survive as an exporter of steel, perhaps not even as a steelmaking country.”

Year-on-year export figures showed similar proportionate changes over the first seven months of the year against the corresponding period in 2011.

Turkey’s steel exports rose by 9.4% to 11.9 million tonnes over the period, up from 10.9 million tonnes last year. The value of these exports increased by just 5.3% to $10.2 billion against $9.7 billion previously.

Exports of hot dipped galvanized coil increased the most, up by 74.6% to 378,000 tonnes. Some service centres have told Metal Bulletin this year that they are looking to break into the Libyan market to widen their exports of the product.

Rebar exports rose by 28.2% to 5.3 million tonnes, structural steel exports increased by 25.5% to 374,000 tonnes, billet rose by 20.6% to 1.7 million tonnes, profiles increased by 7.1% to 1.1 million tonnes, and pipe and tube exports topped 1 million tonnes, up by 7.2%.

Exports of hot rolled flat products decreased by the largest margin, down by more than half to 588,000 tonnes, while wire rod exports fell by 5.2% to 682,000 tonnes.

Efficiency has been paramount at Turkish mills in their attempts to compete internationally, the association source said. “Turkish plants with 3 or 4 million-tpy capacities operate with fewer than 2,000 people, while in some countries similar plants operate with more than 10,000 people,” he said.

Logistical advantages
He added that the geography of the major production areas – Izmir, Marmara, Iskenderun and the Black Sea – gave the country some logistical advantages as they are all close to the sea, allowing easy import and export of raw materials and finished products.

A market development manager at a steel mill added that the split in product exports between those rising and those falling against last year was largely to do with the country’s traditional product range, with high production costs for hot rolled flat products against competitor exporters.

“Turkey is traditionally an exporter of long and semi-finished products. Our mills are familiar with export markets and have experience, but we are a newcomer to the export markets for flat products,” he said.

“Naturally, it is not easy to compete with powerful competitors such as Russia and Ukraine, especially when we know those countries provide iron ore, energy and other necessary elements [for steel production] at a price lower than global levels,” he explained.

“It is one of main reasons for reductions in [Turkish] exports of hot rolled flat products,” he said.

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