86 th OECD Steel Committee Meeting Dr. Veysel Yayan Secretary - - PowerPoint PPT Presentation

CURRENT SITUATION IN TURKISH STEEL INDUSTRY & OUTLOOK

86th OECD Steel Committee Meeting

• Dr. Veysel Yayan

Secretary General Turkish Steel Producers Association 25-26 March 2019 Paris

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Development of Turkish Economy, Construction, Manufacturing and Steel Industries (%)

2

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 GDP 0,7

• 4,7

9 8,8 2,2 4 2,9 6,1 2,9 7,4 2,6 Construction

• 8,1
• 16,3

17,1 11,5 0,6 7,2 2,2 4,9 5,4

8,9

• 1,9

Manufacturing

• 0,1
• 7

13,3 10 1,9 3,8 3,7 5,9 3,8

8,8

1,1 Steel Industry 4,1

• 5,6

15,2 17 5,2

• 3,4
• 1,8
• 7,4

5,2

13,2

• 0,6
• 20
• 15
• 10
• 5

5 10 15 20 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

GDP Construction Manufacturing Steel Industry

Steel Using Industries - Construction

3 17.1 11.5 0.6 7.2 2.2 4.9 5.4 9,0

• 1.9
• 5

5 10 15 20 2010 2011 2012 2013 2014 2015 2016 2017 2018

Steel Using Industries - Manufacturing

4 13.3 10 1.9 3.8 3.7 5.9 3.8 9.1 1.1 2 4 6 8 10 12 14 2010 2011 2012 2013 2014 2015 2016 2017 2018

Industrial Production Index

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Source: TurkStat

80 90 100 110 120 130 140

GDP Growth Rate (%)

6 2.1 4,0 2.9 4,0 3.2 7.4 2.6 1 2 3 4 5 6 7 8 2012 2013 2014 2015 2016 2017 2018

Turkey’s Total Steel Trade (million tons)

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Source: TurkStat

17.6 18.5 20.3 19,0 18,0 16.7 16.9 18.3 22.1 11.1 10.7 11.9 14.9 13.8 19,0 17.5 16.3 14.5 5 10 15 20 25

2010 2011 2012 2013 2014 2015 2016 2017 2018

Export Import

Turkey’s Net Total Steel Export (milion tons)

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Source: TurkStat

6.5 7.8 8.4 4.1 4.2

• 2.3
• 0.6

2.0 7.6

• 4
• 2

2 4 6 8 10 2010 2011 2012 2013 2014 2015 2016 2017 2018

Turkey’s Total Steel Export/Import Ratio ($), %

9 133.2 140.5 152.5 123.0 126.5 95.3 99 108.1 138.0 75.0 85.0 95.0 105.0 115.0 125.0 135.0 145.0 155.0 165.0 2010 2011 2012 2013 2014 2015 2016 2017 2018

Crude Steel Production of Turkey (Mt) & y-o-y Growth (%)

10 29.1 34.1 35.9 34.7 34.0 31.5 33.2 37.5 37.3 6.2 5.2 15.2 17,0 5.2

• 3.4
• 1.8
• 7.4

5.2 13.2

• 0.6
• 16.1
• 20.0
• 15.0
• 10.0
• 5.0

0.0 5.0 10.0 15.0 20.0 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2018-2m 2019-2m

Production Growth (%)

Turkey’s Crude Steel Production Capacity, Production (mt) & Capacity Utilisation (%)

11 84.6 80.5 78.6 66.1 68.2 72.4 73.2 70.4 67.8 62.5 64.4 73.2 71.9 10 20 30 40 50 60 70 80 90 0.0 10.0 20.0 30.0 40.0 50.0 60.0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Production Capacity CU %

Turkey’s Finished Steel Production (Mt)

12 26.3 31.9 34.3 36.4 36.1 36.9 36.9 39.1 38.6 4.6 21.5 7.3 6.2

• 0.9

2.3

• 0.2

6.2

• 1.1
• 5.0

0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 2010 2011 2012 2013 2014 2015 2016 2017 2018 Production Change %

Turkey’s Finished Steel Consumption (Mt)

13 23.6 26.9 28.5 31.3 30.7 34.4 34.1 36.1 30.6 12.4 14.2 5.6 10,0

• 1.8

11.8

• 0.9

5.8

• 14.9
• 20.0
• 10.0

0.0 10.0 20.0 30.0 40.0 2010 2011 2012 2013 2014 2015 2016 2017 2018

Consumption Change %

Conclusion

• Protectionist policies, high exchange rate volatilities and contraction in

domestic demand, affected crude steel production negatively. In 2018, crude steel production decreased by 0.6%.

• Due to these developments, during the first 2 months of the year,

production decreased by 16.1% and capacity utilization rate declined from 71.9% to 60.2%.

• The contraction experienced in domestic consumption, led steel

producers to turn to export market. Thus, in 2018 Turkey's steel exports increased by 20.5%.

• Because of the protectionist measures that are being implemented

worldwide, we are expecting that, starting from the second quarter of the year, export will decrease gradually.

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