Mena Region as Export Location Challenges & Opportunities
Crude Steel Production (2012) : Rank Country Production ( 000 mt) EAF (%) BOF + (%) Total 1546,8 29,3 69,6 1 China 716,5 10,1 89,8 2 Japan 107,2 23,2 76,8 3 United States 88,7 59,1 40,9 4 India 77,6 67,5 31,2 5 Russia 70,4 27 63,4 6 South Korea 69,1 37,6 62,4 7 Germany 42,7 32,3 67,7 8 Turkey 35,9 74,0 26,0 9 Brazil 34,5 23,7 76,3 10 Ukraine 33 4,5 69,4 Source: Worldsteel Association and World bank
Unbalanced Situation in Long vs. Flat : 2011 2012 2012 (9) 2013 (9) Production of Consumption of Production of Consumption of Production of Consumption of Production of Consumption of Long 22.868 13.738 25.238 14.828 18.971 11.099 19.668 12.363 Flat 9.075 13.210 9.039 13.626 6.606 10.154 7.137 10.710 Total 31.943 26.948 34.277 28.454 25.578 21.253 26.805 23.074 The production has increased 4.8% compared to 9 months of 2012. The consumption has increased 8.4% in the same time period Domestic production in long products is around % 59 more than the consumption whereas the domestic production in flat products is fulfilling approx % 67 of the demand for flat products.
Unbalanced Situation in Exports and Imports : Export of Iron and Steel (1,000 tons) 2011 2012 2012-9 2013-9 Billet & Bloom 2.393 2.957 2.304 1.356 Slab 60 21 21 1 Flat 2.298 1.859 1.294 1.858 Long 10.489 11.726 8.886 8.383 Total 15.239 16.563 12.506 11.598 Import of Iron and Steel (1,000 tons) 2011 2012 2012-9 2013-9 Billet & Bloom 2.004 2.403 1.787 2.294 Slab 153 953 428 1.604 Flat 6.433 6.446 4.842 5.431 Long 1.359 1.316 1.014 1.078 Total 9.949 11.117 8.071 10.407 Source: Turkish Iron and Steel Producers Association
Distribution of Steel Exports acc. To Regions : Row Labels 2007 2008 2009 2010 2011 2012 2013 9M EAST AFRICA 291.122 359.658 510.764 363.552 729.545 873.520 667.167 EUROPEAN UNION 6.009.159 4.074.363 2.450.326 2.381.776 3.377.337 2.236.088 2.344.507 LATIN AMERICA 124.217 523.266 538.071 874.557 1.189.031 1.434.350 1.205.433 MENA 7.926.350 12.114.438 11.948.443 10.943.150 8.935.010 11.135.212 8.120.353 NORTH AMERICA 593.982 944.595 395.319 755.708 1.100.867 1.634.622 1.085.294 OCEANIA 311 2.622 3.817 7.286 12.890 15.069 19.625 OTHER ASIA 286.058 682.120 1.750.377 1.036.668 1.135.341 549.566 411.146 OTHER EUROPE 893.955 803.645 644.174 680.045 865.588 1.279.508 1.080.528 SOUTH AFRICA 3.282 23.475 1.840 12.633 68.755 16.427 29.728 WEST AFRICA 96.631 224.227 273.373 285.860 703.332 667.044 402.227 Grand Total 16.225.067 19.752.408 18.516.503 17.341.236 18.117.695 19.841.405 15.366.007 Source: Turkish Iron and Steel Producers Association The export volume of Turkey on Steel is increasing with more than 3% y-o-y change between 2012 & 2013. Middle East North Africa (MENA) is still the leading region on Steel Exports of Turkey. The share of MENA is %52.8
Breakdown of MENA Exports : 2007 2008 2009 2010 2011 2012 2013 9M REINFORCING BAR 5.170.490 8.174.118 7.208.654 4.733.854 4.298.817 5.530.597 4.524.476 BILLET 1.218.503 1.832.404 1.480.803 3.081.784 2.019.740 2.590.622 1.063.200 PROFILE 497.947 649.997 1.177.187 1.017.118 976.383 944.407 738.189 OTHERS 478.188 580.581 720.890 765.133 655.954 798.525 714.085 TUBE 342.328 475.460 727.237 781.530 553.103 671.342 664.652 WIREROD 137.241 324.725 490.863 385.917 241.668 390.033 284.826 HOT ROLLED COIL 81.654 77.153 142.809 177.814 189.344 209.685 130.926 Grand Total 7.926.350 12.114.438 11.948.443 10.943.150 8.935.010 11.135.212 8.120.353 Source: Turkish Iron and Steel Producers Association Reinforcing bar is the main export item to MENA. (55.7%) (It was 49.6% in 2012) It is followed by Billets (13.0%). It was 23% in 2012. Wirerod export share is 3.5% in 2013. It was the same also in 2012.
Çolakoğlu Group : Çolakoğlu is one of the diversified conglomarates in Turkey involved in steel production, shipping, energy, mining and finance. Its steel company Çolakoğlu Metalurji is ranked in the top 20 in the industrial ranking, while its bank is ranked as number 6 in the finance sector in Turkey. Today the group employes 12,000 people.
Investments : 1945 1960 1969 1983 1985 1990 Investment of Rolling Mill in Sütlüce Steel Trade in Karaköy 2007 2010 Start-up of Hot Rolled Coil Production New Meltshop Investment Start-up of Rebar Production Start-up of Wirerod Production Start Selling to Export Markets Meltshop investment in Diliskelesi / Gebze Çolakoğlu s involvement in the iron and steel business began with the steel trade business started in 1945. Today with its 3 million tons crude steel capacity and 4 million tons of rolling capacity, Çolakoğlu is one of the leading companies in the steel industry.
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Production Flow :
Production Capacities : Billet : Capacity : 2,500,000 mt Size : 130, 150 & 200mm Length : 6 16m Reinforcing Bar : July 2010 Capacity: 750,000 mt Size : 8 40mm Length : 6 16m Meltshop : Capacity : 3,000,000 mt Hot Rolled Coil (HRC) : June 2010 Capacity : 3,000,000 mt Thickness : 1.2 25mm Width : 800 1650 mm Slab : (July 2007) Capacity : 3,500,000 mt Thickness : 150 270mm Width : 800 1650 mm Length : 6 16m Bloom : Capacity : 120,000 mt Thickness : 220 mm Width : 150 300 mm Length : 6 16m
Conclusion : The share of exported products to MENA region will change, but MENA region will continue its importance for the Turkish Steel Industry. Turkish steel industry will focus on more value added products. Increase on steel consumption per capita to the level of developed countries will trigger the steel consumption in Turkey and also in MENA region. In addition to the long products, flat steel will also be an important export product for Turkey in its export to main markets. Ability of shifting between long and flat products will bring competitive advantage to the Turkish mills without damaging the markets.