The 5th SteelOrbis Turkish Steel Market Conference, held in Istanbul on November 26, gathering together over 560 representatives from 295 different companies with the sponsorship of Turkish integrated steelmaker Erdemir, began with a quick look by the SteelOrbis team at market developments since the last conference took place. After this general overview, Veysel Yayan, general secretary of the Turkish Iron and Steel Producers' Association, made a presentation in which he cast his eye over trends in steel production across the world and, in particular, assessed the current situation of Turkish steel producers.
In his presentation, Mr. Yayan said that Turkey's total crude steel production in 2010 is expected to rise to 28.5-29 million metric tons, marking an increase of over 12 percent from 25.3 million tons in 2009, ranking ninth among the world's top steel producing countries. Yayan predicted that Turkey may well rank ninth in this list in the coming years, with new investments coming on stream. However, he went on to note that, while Turkey has this year already reached its highest production levels of the pre-crisis period, this has resulted from the country's overall capacity expansion, while the actual capacity utilization rates still remain below the pre-crisis levels.
Mr. Yayan indicated that in 2010 Turkey's crude steel production for flat products is expected increase by around 40 percent due to the new capacities coming on stream, while the share of crude steel production destined for flat steel production has increased to 23.9 percent in 2010, from 18 percent in 2009. Meanwhile, Turkey's flat steel consumption increased by 59.6 percent in the first 10 months of this year, as compared to the year-ago period, revealing that new flat steel investments have also had a stimulating effect on the development of the flat steel consuming industries.
Veysel Yayan remarked that Turkey's steel production structure, based on production by EAFs, is no longer seen as disadvantageous, given that gas emissions in EAF production are significantly lower as compared to production by blast furnace. However, EAF production also increases Turkey's dependence on ferrous scrap imports, which are expected to reach 18.2 million metric tons in 2010, up from 15.6 million metric tons in 2009, while the country's domestic scrap supplies remain at 6.4 million mt this year. Yayan told the conference attendees that investments in scrap, iron ore and ferroalloys are on the agenda in Turkey, adding, however, that these investments would require some time.
On the other hand, Mr. Yayan stated that development in Turkey's steel industry is not only supported by its exports, but also by its growing economy which boosts its steel consumption. Turkey's total steel consumption is expected to rise by more than 25 percent year on year in 2010, Yayan said, noting that this growth rate is partly due to the base effect, but is also due to real growth in the Turkish economy, which is expected to expand by almost eight percent in 2010.
Underlining that the restructuring process in the Turkish steel industry has accelerated in the last two years, Mr. Yayan informed attendees that, due to the new investments, Turkey is expected to be self-sufficient in flat steel, structural steels and specialty steels by 2015. Despite weak demand in the international markets, strong growth in Turkish steel consumption is expected to support growth in the steel industry, Mr. Yayan concluded.