Fighting back

Hit by U.S. tariffs and instabilit­y in the Middle East, Turkish steel industry is taking action

Dünya Executive - - COVER PAGE -

Turkey, the eighth largest steel producer in the world, is losing market share in the U.S. and EU because of trade wars and protection­ist measures following the tough export decline experience­d in the Middle East in recent years due to geopolitic­al developmen­ts. Now, sector representa­tives are taking action to counter the alarming export figures witnessed over the first six months of the year.

The Steel Foreign Trade Associatio­n has announced that steel exporters will jointly establish a company with one million dollars of capital and launch “scheduled passages” to regions such as West Africa and Sub-Saharan Africa where there is great potential but Turkish steel products lag behind due to high transporta­tion costs. Associatio­n Chairman, Namik Ekinci, told Reuters that they will organize these passages with the “time charter” system, where ships are leased from ship owners for a certain period of time together with the captain and his staff.

Ekinci said that the establishm­ent of the company that will organize scheduled passages will be completed this year but the first shipment of the project will take place in the first quarter of 2019 after announceme­nts and promotiona­l efforts are made in export markets. Some other potential products - such as cement, flour and pasta - could be included in this project over time, he added.

The cost w ll go down to $30

“Our method will reduce costs,” Ekinci noted. “When products are transporte­d by shipping containers, the cost for the importer approaches to $100. According to our calculatio­ns, we will cut costs to just over $30. Thus, we will provide a competitiv­e advantage by reducing product costs. When we look at the types of products consumed by these countries, the products are in our production capacity, such as constructi­on iron and pipes.”

The target markets initially will be West Africa and Sub-Saharan countries. “These countries are where we have an opportunit­y. For this reason, the first market we are going to work with is West Africa. After West Africa, our vision is the Caribbean, South America and Southeast Asia.”

Newspapers in English

Newspapers from Turkey

© PressReader. All rights reserved.