Important players from domestic and foreign steel markets came together in “SteelOrbis Turkish Steel Markets 2006 Conference” held in Istanbul on May 26. The conference began with the opening presentation of Dr. Veysel Yayan, General Secretary of
Turkey Iron and Steel Manufacturers Association. Having made a general evaluation on the global and Turkish iron and steel industry, Veysel Yayan said that the must important period for the global and Turkish iron and steel industry began in 2000. Having mentioned that global steel
production increased approximately 50% in the last five years over the previous 30 years, Yayan identified that the extraordinary market conditions between 2000 and 2005 have almost completely stemmed from
China, who accounted for approximately 30 percent of global steel
production.
China has realized 349 million tons of raw steel
production in 2005 and obtained 31% share in total global
production. Strong domestic demand between 2000 and 2005 has also enabled
China to keep its
consumption and imports at high levels; therefore, global steel prices recorded strong increases. However, the price difference between
China and
Europe or USA led to the cessation of
China's imports and an increase in its exports, which led to a sharp fall in prices last year. On the other hand, the developed countries such as the USA, EU and
Japan which have almost completed their infrastructure
investments represent a horizontal line for both steel
production and
consumption. Global steel
consumption is shifting from the developed western countries to the developing eastern countries. In the meantime, western steelmakers are turning towards higher value added products instead of instead of increasing their
production quantities. In
Turkey, which has entered into a stable growth period following the last economic stagnation experienced in 2001, per capita steel
consumption that was around 150 kg in 1990 increased to 200 kg in 2000 and to 275 kg in 2005. It is predicted that per capita steel
production will increase to 350 kg by 2010. Despite the uncertainty in international markets in 2005, and the declines in
Turkey's exports to the USA, EU and
Far East respectively by 43 percent, 28 percent and 44 percent and the decline in overall exports by 9.8 percent, Turkish raw steel
production indicated 2.4 percent increase thanks to brisker domestic demand. Turkish mills compensated a portion of their losses in exports to the afore-mentioned markets by turning to
Middle East, Gulf and North
Africa. It is predicted that the steel
consumption in the world and around
Turkey, will continue to increase by 5 percent per annum, which will put a pressure on raw material prices. Meanwhile, higher prices will turn marginal capacities into economical ones, and therefore will lead to an increase in raw material
production. In this regard, no raw material shortage is expected in the global steel industry in the short run. Nevertheless,
Turkey is obliged to reduce the
investments oriented on long products and speed up flat steel
investments. Besides, global consolidation will also contribute to the steel industry in
Turkey and in the entire world.