Global crisis still impacts on Turkish stainless steel market but to lesser degree

Market players think that the peak influence of the global crisis may well have been seen in Turkey over the past month. With the implementation of some measures by the government, the sector has gained some relief. In particular, sectors such as automotive and white goods will be able to sell more materials thanks to the tax reductions. Some firms whose stocks had melted started to buy spot materials for immediate needs but not for their stocks. Thus, although demand this month seems better compared to last month, it may be said that the sales volume is down by 40-50 percent compared to the same period of last year.

Meanwhile, it may not be quite correct to say that the uptrend in the automotive and white goods sales volumes in Turkey has been reflected in the stainless steel market with the same impact. It seems that only existing stocks of material have been melted. Some producers are still able to manage with their available stocks. On the other hand, other producers are backing down from "just-in-time" production and prefer to buy some materials to carry out new production.

Looking at the nickel prices, they have been more stable in the last two months, whereas previously they had been fluctuating in general. The current base nickel price levels of $10,000-15,000/mt seem to be an obstacle blocking any price fluctuations. These days, the most sluggish countries as regards industrial sectors are the most industrialized ones such as the European countries, the US, Russia and Japan. Since demand in these countries has declined sharply, stainless consumption in the countries in question have also decreased significantly and prices have softened at the same rate. Meanwhile, the Middle East is even showing some small levels of activity. The sales volumes of cookers, kitchenware and sink producers in this region are relatively positive compared to other sectors since these producers have been affected less than other sectors thanks to a number of ongoing construction projects.

As of the fifteenth week of the year, offers of stainless steel coil ex-stock materials from the important European producers and trading firms to the stainless steel service centers in Turkey are as follows:

Looking at the price movement in the local Turkish market from the beginning of 2009 up to the present, we can see that prices have decreased in line with demand.

Changes in nickel prices may be seen in the graph below. With these two graphs, we can see how the decline in the industry has been reflected precisely on to prices.