"Turkey Metals Report Q4 2010" is now available at Fast Market Research

Oct. 4, 2010 - PRLog -- The Turkish steel industry is facing significant difficulties in terms of competitiveness in sluggish and volatile export markets, as well as the soaring costs of raw materials, according to this latest Turkey Metals Report from BMI.

Key risk factors include the rapid rise in the cost of scrap steel which is used as the majority of the industry's raw material, appreciation of the Turkish lira against the euro, surging steel production in Saudi Arabia and Qatar and, to a lesser extent, suggestions that Turkish steel exports could be subject to trade barriers by Arab states seeking to protect their own steel industries. Altogether, these factors will squeeze steel production margins and hold back export growth. In addition and worryingly for Turkish steelmakers is the shift in exports from high value to low value products. In H110, exports of billet and slab grew by around 150% and 390% year-on-year (y-o-y) respectively, while exports of high value added products such as flat and long products fell by around 50% y-o-y.

In January-July 2010, Turkish crude steel production rose 11.1% y-o-y to 15.87mn tonnes, following a decline in output of 5.6% to 25.3mn tonnes in 2009. While June and July followed the global trend of declining output, mirroring a slowdown in construction activity and the automotive industry in Europe and Asia, monthly output was only just still keeping ahead of the levels seen in 2009. Nevertheless, the downturn is a cause for concern, with metals utilising industries witnessing a drop in production levels. Production from EAFs increased by 10% y-o-y while steel production using blast furnaces increased by 13.9%. Around 69.9% of production came from mini mills, with the remaining 30.1% from integrated plants. The continued dominance of electric arc furnaces (EAFs) in Turkish steelmaking helped boost scrap steel imports, which grew 24.9% y-o-y to 8.79mn tonnes in H110, valued at US$3.27bn (up 85.4% y-o-y).

While we hold to a broadly positive medium-term outlook, we caution that a 'V-shaped' recovery in 2010 is unlikely, with domestic private consumption likely to remain markedly weaker than during the precrisis period. As such, the Turkish metals market will lag behind the rest of the economy, with finished steel consumption up 9.6% to 16.23mn tonnes in 2010 following contractions of 12.0% and 17.2% in 2008 and 2009 respectively. At the same time, crude steel output will rise 6.1% to 26.84mn tonnes - a downward revision from the 28.98mn tonnes forecast in the previous quarter, in light of the downturn in growth in domestic and external markets.

Sluggish construction growth in Turkey and elsewhere has also depressed longs production, the country's largest steel product sector, accounting for more than three quarters of the total. According to the Turkish Iron and Steel Producers' Association, in the first seven months of 2010 Turkey's flat steel output increased by 59.1% y-o-y to 3.73mn tonnes, constituting 23.5% of total domestic steel output compared with 16.42% in the corresponding period of 2009. Turkey's long steel production grew by only 1.7% y-oy to 12.14mn tonnes in the same period, accounting for 76.5% of the country's total steel production compared to 83.58% in the corresponding period of 2009. This followed a decline in external markets with the Istanbul Mineral and Metals Exporters Association reporting that in July 2010, Turkey's steel exports to the EU declined by 4.9% m-o-m - though this was up 5.7% y-o-y - to US$173.65mn. The EU market accounted for 17.1% of the country's total steel exports, up by 0.1 percentage point from July 2009.

For more information or to purchase this report, go to:
-  http://www.fastmr.com/prod/87305_turkey_metals_report_q4_...

Report Table of Contents:

Executive Summary
SWOT Analysis
- Turkey Political SWOT
- Turkey Economic SWOT
- Turkey Business Environment SWOT
Global Market Overview
- Table: World's Top 10 Steel Producing Countries
- Table: Recent And New Smelter Capacity
Commodities Forecast
- Nickel
- Table: BMI's Nickel Forecasts
- Table: Nickel, 2005-2011
- Aluminium
- Table: BMI's Aluminium Forecasts
- Table: Aluminium, 2005-2011
- Copper
- Table: BMI's Copper Forecasts
- Table: Copper, 2005-2011
Regional Overview
Forecast Scenario
- Table: Turkey Aluminium Market, 2004-2008
- Table: Turkey's Metals Industry 2007-2014 ('000 tonnes unless stated)
- Macroeconomic Forecasts
- Table: Turkey - Economic Activity
Competitive Landscape
- Steel
- Table: Turkey's Steel Mills
- Aluminium
Company Profiles
- Erdemir
- Kardemir
Global Assumptions - Q4 2010 Update
- Table: Global Assumptions
- Table: Global & Regional Real Gdp Growth
- Table: Consensus Forecasts
- Table: Developed States, Real Gdp Growth Forecast
- Table: Emerging Markets Aggregate Growth
- Table: Emerging Markets Aggregate Growth
Country Snapshot: Turkey Demographic Data
- Section 1: Population
- Table: Demographic Indicators, 2005-2030
- Table: Rural/Urban Breakdown, 2005-2030
- Section 2: Education and Healthcare
- Table: Education, 2002-2005
- Table: Vital Statistics, 2005-2030
- Section 3: Labour Market and Spending Power
- Table: Employment Indicators, 2001-2006
- Table: Consumer Expenditure, 2000-2012 (US$)
BMI Methodology
- How We Generate Our Industry Forecasts
- Cross Checks

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Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.