Dalbeler: Turkish mills burdened by $15/mt extra energy costs for steel production

Friday, 23 August 2019 17:59:44 (GMT+3)   |   Istanbul

Ugur Dalbeler, executive board member of the Turkish Steel Exporters’ Association and general director of Turkish steelmaker Colakoglu Metalurji, has told local Turkish news channel Bloomberg HT that Turkey, which was for a long time the eighth biggest steel producer in the world, has now regressed to ninth place. Mr. Dalbeler said that in the first half of the current year local Turkish steel demand declined by 32 percent and output declined by 10 percent, though in the same period steel exports increased by 15 percent, all year on year. He also added, “At least, second quarter results are better than the first quarter figure. We see that an environment of confidence has started to be formed. We can see this looking at overall indicators.”

Mr. Dalbeler pointed out that the fact that Turkey has to import raw material is a drawback for the country in terms of costs and he also added that Turkish producers are affected by some factors like environmental contributions and extra energy costs, which are not imposed on other foreign competitors. “We pay an additional energy cost of almost $15 per every ton of steel we produce, which adds up to TRY 900 million. If you include the environmental contribution fee, this exceeds TRY 1 billion. As long as we carry this additional burden, we will always have difficulty in competing in global markets,” he explained.

Regarding the new adjustments the EU proposed for its quota system, the Çolakoğlu general manager said that the free trade agreement between Turkey and the EU has been working in favor of the EU and when the winds have changed to favor Turkey the EU has decided to change the rules of the game. “We have serious concerns going forward, regarding how we are to trust the EU’s commitments made in the agreements we have,” said Mr. Dalbeler.  

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