Dallas, TX -- (SBWIRE) -- 10/22/2012 -- Turkey Metals Report Q412 examines how the steel industry has performed in the face of external headwinds and warns some segments are facing increased pressure as a result of decreased manufacturing activity in the EU. It examines the latest plant projects and whether output is keeping pace with the ongoing increases in capacity. The report also analyses the investment strategies being employed by the leading players in the Turkish steel industry, as they seek to maximise the growth opportunities offered by the regional market.
In the first seven months of 2012 Turkey produced 21.1mn tonnes (mnt) of steel, up 9.3% y-o-y. This followed a strong 2011 when output grew 17.6%. As a result, Turkey represented 24% of global output growth, the largest single contributor. BMI believes Turkey is still on course for its forecast 6% growth in crude steel output to 36.1mnt. Meanwhile, Turkey is increasingly self-sufficient in a broad range of steel products as a result of increased capacity and moderation in domestic demand growth. In H112, Turkish flat steel imports were down 5% y-o-y to 2.43mnt with hot-rolled imports declining 4% and coated steel imports falling 23%, offsetting rises of 14% in cold rolled flats and 2% in strip. At the same time, growth in exports is improving the country’s steel trade surplus. Total steel exports grew 9% y-o-y to 11.7mnt with revenue increasing 4% to US$9.3bn.
In the aluminium sector, the country’s sole 60,000tpa Seydisehir smelter – which has been operating at maximum capacity over the past five years – is unable to fulfil all the country’s aluminium requirements. Smelters will also face increased competition from re-melters.
Over the last quarter BMI have revised the following forecasts/views:
- BMI forecasts 7.8% growth in crude steel consumption in 2012, with consumption set to reach just under 41mnt by 2016, an increase of around 40% over 2011 levels.
- A decline in flat steel product exports is bound up with the reduction in production of vehicles in Europe with flat production adversely affected by a 5.7% decline in vehicle exports in H112, which coupled with weak domestic demand led to a 9.1% decrease in Turkish vehicle production.
- Turkish steel producers have been able to take advantage of EU sanctions to virtually monopolise the export of billet to Iran, a situation that has enabled billet exporters to raise their prices.
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