During the past week, demand in the local Turkish hot dip galvanized coil (HDG) market has remained weak, while prices of domestic HDG in Turkey have moved sideways. It is observed that buyers in the local Turkish HDG market postponed their purchases before the New Year holiday, while they have restarted their price inquiries again today, January 2, though maintaining a cautious stance and still exerting pressure on prices. Market sources do not expect a significant fluctuation in the market prices before the end of the Orthodox Christmas holiday, while they believe buyers will continue their purchases only in line with their immediate needs.
On the other hand, the European Commission has imposed import quotas on HDG products on country-basis. Although there has been no official announcement yet, according to a document seen by SteelOrbis Turkey has been included in the “other countries” category, with the European Commission imposing a quota of 910,966 mt on Turkish HDG imports for the February 2, 2019-June 30, 2019 period, which will be revised to 2,343,000 mt for the July 1, 2019-June 30, 2020 period, and to 2,460,000 mt for the July 1, 2020-June 30, 2021 period. According to the data the first ten months of 2018, Turkey exported 330,000 mt of HDG to the region. As a result, from the point of view of Turkish mills, the new quotas are not expected to have a negative influence on their HDG exports.
On the other hand, the EU has imposed country-based quotas for its important import HDG sources, India and South Korea. Considering the HDG imports made from these countries in the first ten months of 2018, the new quota will not affect India significantly, though South Korea is expected to be forced to cut its HDG exports to the EU by approximately 20 percent as of February 2. The general opinion in the market is that this development can be considered as an advantage for Turkish mills as they can increase their HDG export tonnages to the EU within the scope of the new quota regime.
Domestic producers’ HDG prices in the local Turkish market, excluding 18 percent VAT, are currently at the following levels:
|
Product |
Price ($/mt) |
Weekly change ($/mt) |
|
HDG 0.50 mm 100gr/m² |
660-690 |
0 |
|
HDG 1 mm 100gr/m² |
605-660 |
0 |
|
HDG 2 mm 100gr/m² |
565-585 |
0 |
Meanwhile, it is observed that ex-Turkey HDG prices have remained stable week on week at $655-675/mt FOB.
Note: According to the statistics provided by the Turkish Statistical Institute (TUIK), the products in question currently fall under Customs Tariff Statistics Position Numbers 7210490010 and 7210490090. But, according to the European Union’s Customs Tariff Statistics Position Numbers, they fall under 7210490020 and 7210490080.