Ekinci: Energy burden must be cut for Turkish steel mills

Monday, 08 October 2012 17:55:47 (GMT+3)   |  
       

The Turkish Steel Exporters Association (CIB) has evaluated the latest price hikes for electric energy and gas in Turkey, saying that the rising prices will lead to trouble for the country's steel industry.

CIB chairman Namık Kemal Ekinci commented on the hikes noting that Turkey's steel production is 75 percent based on electric arc furnaces and is a very high consumer of energy and gas. He called for the reduction of additional artificial burdens in energy costs and the inclusion of energy consumed in the production of exported products in Turkey's Inward Processing Regime (IPO) which is aimed at incentivizing exports.

Observing that the Turkish steel sector has been increasing its production every year and has become the eighth largest producer and exporter of steel in the world, Mr. Ekinci forecast that in 2012 Turkey will produce 37.5 million mt of crude steel while exporting 20 million mt of steel product. According to the statisctics for 2010, the energy consumption of the steel sector in Turkey was responsible for 11 percent of Turkey's total energy consumption and for 23 percent of total energy consumption by Turkish industry, while the gas consumption of the steel sector constituted five percent of Turkey's total gas consumption and 10 percent of total gas consumption by Turkish industry. Ekinci highlighted the importance of energy costs in terms of the ability to export steel products at competitive prices.

The CIS chairman said that 44 percent and 49 percent increases were seen respectively in energy and gas prices within the last year, stating that steel companies continue to emphasize the difficulties caused by high energy costs and continue to seek the removal of extra taxes from energy costs. 


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