Turkiye: Ferrous scrap imports drop 15% in CY'22 on steel production cuts

Turkiye's ferrous scrap imports decreased by 15% to 20.65 million tonnes (mnt) in CY'22 compared to 24.37 mnt in CY'21, as per customs data. Notably, exports declined from the US, a major supplier, due to active demand from other origins, like India, towards the end of the year.

Import volumes showed a mixed trend since June, as Turkish mills began procuring from different origins at reasonable prices other than traditional suppliers such as the US and the UK.

Meanwhile, Turkish steel producers struggled to maintain normal production following a hike in electricity tariffs in September. Many steel mills were forced to cut output. Furthermore, both domestic and international demand remained low for the last few months of 2022.

The country imported 1.26 mnt of ferrous scrap in December, a decrease of 5% m-o-m compared to 1.33 mnt in November. Scrap imports decreased significantly by 49% y-o-y against 2.49 mnt in December 2021.

Country-wise shipments

• Imports from US up 5% in CY'22: Turkiye's imports from the US increased by nearly 5% to 3.95 mnt, with the US remaining the top exporter to Turkiye for yet another fiscal year. After a sharp decline in imports in November, Turkiye's import volumes from the US recovered by over 105% m-o-m to 0.29 mnt in December. Despite overall imports by Turkiye declined, imports from the US increased.
  
  
• Imports from Netherlands down: Shipments from the Netherlands fell by 35% in CY'22 at 2.08 mnt. After a whopping 82% increase in November, volumes again dropped by 59% at 0.12 mnt in December. Reasonable import prices from the Netherlands and shorter shipment times enticed buyers.
  
  
• Shipments from Russia, UK decline: Russia exported 0.44 mnt to Turkiye in CY'22, down 77% compared to 1.91 mnt in CY'21. Due to the Russia-Ukraine conflict, the trade flow was disrupted for more than six months. Shipments from the UK also fell by 22% in CY'22 at 1.81 mnt compared to 2.33 mnt in CY'21.
  
  

Key updates

• Crude steel output declines: Turkiye's crude steel production was recorded at 35.1 mnt in CY'22, down 12.9% compared to CY'21, as per World Steel Association (WSA) data.
  
  

• Lira falls: The value of the Turkish lira dropped to 18.68 in December from 13.31 in January.
  
  

Outlook

After a period of subdued activity towards the end of 2022 due to increased power tariff and production cuts, Turkish mills are expected to procure actively in the near term. Hence, it is expected that import volumes may rise. Frequent bulk deals from the US and EU, on the other hand, are expected to push up prices.