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Effects of Covid 19 on the steel industry

November 2020

The effects of the COVID-19 pandemic became visible in 2020. The disease, which has spread worldwide as of April 2020, in the production sector; This has caused problems such as slowdown or stoppage of production, decrease in production quality, deterioration of supply chains and decrease in demand for manufactured goods.

The production of steel and other metals provides raw materials or intermediate products to many industries in Turkey and around the world. For this reason, the steel industry was adversely affected by the stagnation in other sectors. Turkey's steel products exports decreased by 10.3 percent on amount basis to 1.5 million tons in August with the effect of the COVID 19 epidemic, while it increased by 14.9 percent on value basis to $1.02 billion. In the January-August period, compared to the same period of the previous year, exports decreased by 10.2 percent on amount basis to 13 million tons, and decreased by 16 percent on value basis to 9.1 billion dollars. Compared to the same month of the previous year, imports fell to 1.09 million tons with a decrease of 7.7 percent on amount and to 765.5 million dollars with a decrease of 12 percent on value basis. In the January-August period, imports reached 8.7 million tons with an increase of 8.7 percent in terms of quantity compared to the same period of the previous year, and decreased by 5.1 percent in terms of value to 6.3 billion dollars.

Despite the effect of the epidemic, Turkey's crude steel production increased by 18 percent to 3.22 million tons in September compared to the same month of the previous year. According to Worldsteel data, in September, Turkey's crude steel production amounted to 3.22 million mt, up 18 percent year on year, while crude steel production in the first nine months amounted to 25.93 million mt, up 2.6 percent year on year. Thus, Turkey overtook Germany to become the largest steel producer in Europe and the seventh largest in the world. Germany, which ranks eighth, produced 25.73 million mt of crude steel in the January-September period, down 15.7 percent year on year.

In October, there were good developments in terms of steel production, which we, as Salda Metal, attach great importance to and target. One of the manufacturers in our country has started to produce special quality stainless steel sheet. The world's largest casting tonnage was achieved for AISI 304 and 304L grades, and these grades were produced for the first time in Turkey. Especially in recent years, our Turkish companies, which have turned to value-added steel production, are also increasing and new investments are being made in this regard. Good quality namely alloy steel; It brings the advantage of being one step ahead of its competitors in terms of user sectors, while having high sales prices for manufacturers and exporters.

Southeast Asia, West Africa and Latin America regions, where steel imports have increased in line with the search for new markets, are among our prominent target markets. It is obvious that exports could not be realized at the desired levels in all markets due to the pandemic, so it has become more important than ever for our industry to turn to alternative markets. As a result of the unfair increase of customs walls by the countries in the export markets around the world in the last period with the epidemic, the EU has been our market with the most losses in the first half of 2020. The EU has tried to prevent imports from Turkey as much as possible with the protection measure reviews. As the Union, we continue our legal initiatives against these unfair practices faced by our industry; We think that unfair restrictions harm free trade.

As a result, on the one hand, the sector is making great efforts to achieve its 2020 targets, and on the other hand, it follows the opportunities that will arise after the process and the process. Companies that take care to take their steps in the most correct and efficient way make fine calculations to achieve their targets and to leave this process behind without loss or even by getting stronger. While the World Health Organization and the health industry are looking for a solution to the fight against this virus, the steel industry makes an effort to meticulously apply the hygiene rules in this process and to continue their production without interruption. As Salda Metal, we are making great efforts to draw the most efficient roadmap by analyzing the advantages and disadvantages brought by the epidemic. We emphasize the importance of preparing for the post-pandemic period from today and we think that this will provide great competitive advantages in international markets...

Salda Metal has started its Turkey adventure quickly

Salda Metal expressed its confidence and allegation in the sector as follows: "This is not just a start or a change of location in the country but at the same time It represents an important beginning in terms of presenting a vision that leads with the development of the metal industry in Turkey.”

Industry News

In the January-May period, compared to the same period of 2018, exports amounted to 9.8 million tons with an increase of 20.4% in quantity and 7.2 billion dollars with an increase of 6.5% in value.