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Kallanish Kallanish

Knowledge matters Knowledge matters

October, 31st 2020

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MAY 17

US Turkish duty reduction supports rebar trade: Dalbeler


The US halving of Turkish steel import duty to the blanket level of 25% will help Turkish rebar trade, Turkey's Çolakoğlu's chief executive officer Uğur Dalbeler tells Kallanish.

"Compared to our situation during the last eight to ten months, it is good news to have American market back again," Dalbeler says. He adds that Turkey had lost tremendous opportunities however due to its having been singled out during this time.

Capacity utilisation in the United States has increased up to 83% as compared to 72% a year ago. Steel imports have fallen by around 12%, indicating that the import market has shrunk by about 30%, Dalbeler adds. However, having the US export alternative back will increase Turkish exporters' bargaining power in other regions, thus offsetting the drop in rebar export prices, he adds.

Dalbeler cites the outcome of the US-Canada-Mexico talks and US-China talks as two other pivotal factors for Turkish rebar exports in the near future. Regarding the former, the liberation of Mexican and Canadian imports into the US would likely lead to increased imports into the US of those countries' steel products. Considering NAFTA's apparent shortage of certain steel products however, should these increases take place, Turkey could supply more product to these countries, achieving an overall positive effect.

In the case of China-US talks, Chinese domestic market rebar demand looks set to be increasing, in which case Turkey could replace its market share in ASEAN, Dalbeler notes.

"Turkish rebar is the No.1 choice for the majority of the global regions due to its versatility, - we can produce any grade to any certification - and high quality," he says. He adds that the main problem remains low demand in the Turkish domestic market, which has shrunk by -65% in the last year. 

With regard to the removal of Turkey from the Generalised System of Preference (GSP) by the US, Dalbeler notes that the effect will be significant for Turkish exporters. Turkish exports to the US of automotive products, precious metals and jewellery, are all to be affected. The automotive industry share is likely to have most effect on the domestic steel industry, although magnitude of this is difficult to estimate, Kallanish notes.