At the 13th International Steel Market and Trade Conference being held on March 31-April 2 in Shanghai, SteelOrbis market analyst Nazlı Keseli talked about the market situation in the Middle East and
Turkey. She said that, despite projects like the third Bosphorus bridge and the new airport in Istanbul, softening iron ore prices and the relative strength of scrap prices have negatively affected the Turkish steel industry. Many production cuts were observed in the country during 2014, leading to reduced crude steel output for the year.
Ms. Keseli stated that lower scrap prices are expected in 2015. Accordingly, the production costs of EAF-based Turkish mills will decrease and Turkish mills will become more competitive in the global markets. On the other hand, she went on to say that the strong dollar and oversupply will continue to put Turkish domestic steel demand under pressure and fierce competition will remain a problem in the global markets. She underlined that countries will take further measures to protect their economies. As a result, Turkish mills are expected to implement further production cuts in 2015.
According to the SteelOrbis market analyst, crude steel production in the Middle East has increased by 58 percent since 2009, though this strong growth has not been sufficient to meet regional demand, resulting in imports. Keseli stated that the producers in the region still have many projects aimed at increasing production, but at the same time they are experiencing problems in selling their material because of lower import prices. She pointed out that, with the lifting of the long-standing export ban in Iran, the biggest crude steel producing country in the Middle East, last year Iranian steelmaker Mobarakeh Steel started to export small tonnages, especially to the European Union and
Turkey.
Nazlı Keseli stated that in 2014 the strongest demand for long steel in the Middle Eastern region was observed in Saudi Arabia on the back of the many construction and infrastructure projects in the country. However, the Saudi Arabian economy has faltered a little with the drop in oil prices, causing some projects to be cancelled, and this impacted steel demand negatively. While
Turkey exported 210,000 mt of rebar to Saudi Arabia in 2014, China sold around 180,000 mt of rebar to the country during the same period.