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Turkish steel importers seek alternatives to Russian supplies, paving the Way for Iranian steel

As the European Union enforces a ban on steel products containing Russian-made semi-finished products from October onwards, Turkish steel billet and slab importers are exploring options to reduce their reliance on Russia. This move presents a promising opportunity for Iranian steelmakers to expand their presence in the Turkish market.

Turkish steel importers seek alternatives to Russian supplies, paving the Way for Iranian steel

As the European Union enforces a ban on steel products containing Russian-made semi-finished products from October onwards, Turkish steel billet and slab importers are exploring options to reduce their reliance on Russia. This move presents a promising opportunity for Iranian steelmakers to expand their presence in the Turkish market.

Over the first eight months of this year, Turkey witnessed a significant surge in the import of semi-finished products, with imports reaching 4.3 million tons, marking a substantial increase of 41.4% compared to the same period last year. The preference for importing billet and slabs instead of direct steel production from scrap is primarily attributed to the favorable economics it offers to Turkish steel producers, given the high production costs associated with the latter method.

A noteworthy development influencing this shift is the recent 20% hike in electricity and industrial gas prices in Turkey, which is expected to elevate the production cost for Turkish steelmakers by approximately $15 per ton. Consequently, this cost increase is likely to drive a higher demand for imported billet and slabs in the Turkish market.

Russia, a major supplier, had exported 2.27 million tons of semi-finished products to Turkey in the first eight months of this year, securing a dominant 53% share of the market. However, with the EU ban on the horizon and the Turkish market's growing need for alternatives, this market share may experience a decline in the coming months.

It is worth noting that in addition to Russia, countries such as Algeria, Malaysia, India, and Indonesia have also ramped up their export of semi-finished products to Turkey in the current year. Malaysia, in particular, is strategically increasing its steel production capacity to capitalize on the demand for intermediate steel in the Turkish market.

As Turkish steel importers diversify their sources, Iranian steelmakers are poised to seize the opportunity presented by this changing landscape. With the potential for increased Iranian steel exports to Turkey, the dynamics of the Turkish steel market are set for an interesting evolution in the months ahead.

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