Reuters reported that Turkish steel prices will rise in 2011 to 2012 but are unlikely to hit the record highs hit in 2008 as growing domestic demand and exports to new markets will be offset by a drop in exports to the Middle East and North Africa.
Mr Namik Ekinci CEO Steelmaker Ekinciler and chairman of the Turkish steel exporters association said that "I was expecting steel prices to increase more in 2011 but because of political unrest in the Middle East and North Africa this was delayed. I still expect prices to increase in 2011 but I'd rather they didn't increase too much because huge increases are followed by big crashes which result in big losses. You can lose gains accumulated in 8 to 10 months in only 1 month to 2 months."
Mr Ekinci said that also as the Middle East and North Africa develop their own steel industry, Turkish producers are looking at new export market. Central and southern Africa and Latin America offer the biggest potential. Product diversification is the answer to oversupply.
Ekinciler normally exports 85% of its production and sells 15% in the domestic market but this year that has changed to 60% and 40% as political turmoil hit exports to the MENA region and increased investment in construction in Turkey boosted domestic demand.
The record prices hit in 2008 however still seem remote as Turkish steel producers face increased competition both domestically and in the Middle East and North Africa, their key export regions. Prices of rebar a finished long product used in construction to reinforce structures were at USD 710 per tonne to USD 720 per tonne free on board Turkey this week compared with levels of USD 1,500 per tonne to USD 1,600 per tonne fob in 2008.
Most Turkish steelmakers produce and export long steel products such as billet, rebar and wire rod used in construction. But these are in oversupply and some steel producers are switching to other steel types including flat steel products used to make cars and white goods and stainless or higher grade steel used in anything from construction to cutlery.
( Source: www.steelguru.com )