The uncertainty in the local Turkish welded pipe market has continued, while both buyers and producers have maintained a wait-and-see stance over the past week. As of the current week, the downward pressure on domestic hot rolled coil (HRC) prices in Turkey has increased further and there are expectations that HRC prices will decline in the coming weeks. Turkish welded pipe producers have continued to monitor the market against the backdrop of these developments. While demand in the local Turkish welded pipe market has been sluggish over the previous weeks, price inquiries have increased slightly in the current week, though purchases have not yet restarted. Market sources believe domestic welded pipe prices in Turkey may be revised after the future trend of HRC market gains clarity. Accordingly, domestic welded pipe purchases in Turkey are expected to revive when prices are revised.
It is observed that the price gap between HRC prices, which have been at high levels for a while now, and welded pipe quotations, which have failed to move up due to sluggish demand, has narrowed significantly. As a result, a possible fall in HRC prices is expected to reassure welded pipe producers who need to replenish their inventories to continue production.
Turkish producers’ offer range for ERW pipes and hollow sections with 2-4 mm wall thickness made from hot rolled coil (HRC) of S235 grade as per EN 10219 to the domestic market has remained stable over the past week at $680-720/mt ex-works.
Amid the sluggishness and the uncertainties in the local Turkish welded pipe market, steel mills are trying to pursue export sales and so they have decreased their welded pipe export offers by $20/mt on the upper end to markets to which they continue to conclude sales. As a result, Turkish producers’ export prices for ERW pipes and hollow sections with 2-4 mm wall thickness made from HRC of S235 grade as per EN 10219 have moved down to $710-720/mt FOB.
Amid the increased protectionism in the international markets against the backdrop of the Section 232 tariffs and European Commission’s investigation initiated against steel imports, Turkey is still expecting an exemption from the US, though it is also possible for Turkey to be exposed to a duty or quota on its steel exports to the European Union (EU). Despite the 25 percent duty on steel imports in the US, Turkish steel producers may still continue their sales to this destination since prices in the US domestic pipe market have moved up, but the tonnages of Turkish welded pipe exports to the US are expected to decline as compared to the pre-tariff period. On the other hand, a reasonable quota initiated by the EU could allow Turkey to continue to export welded pipe to the region.
However, market sources draw attention to the fact that, having lost their price advantage in these two export markets, Turkish steel mills may focus on their domestic markets. If this turns out to be the case, competition in the local Turkish welded pipe market will increase.