Iron and Steel Industry Sets 2021 Export Target

Steel sector increases exports to Far East countries Yalçın Ertan, Chairman of the Aegean Association of Iron and Non-Ferrous Metals Exporters, stated that the steel sector's 2021 export target is USD 1.4 billion. Ertan shared the following information in his statement. Despite the Covid-19 pandemic that began spreading globally at the beginning of 2020, in 2020 the Aegean Association of Iron and Non-Ferrous Metals Exporters earned USD 1 billion 361 million for our country; nationwide Turkey earned USD 20.9 billion in foreign currency. Among the associations under the umbrella of Aegean Exporters Associations, we were the association with the highest exports. It is also a source of pride for us to be among the sectors that earn the most foreign currency for both our region and our country. As you know, our steel sector has undergone a difficult period for two years due to protectionist measures and additional tariffs applied in our main markets, the US and EU, as well as low domestic consumption. We entered 2020 by reducing these difficulties through our companies' initiatives to target new markets and higher-value production, but of course the pandemic showed its impact both in our sector and in the steel-consuming sectors we supply. Nevertheless, although we slowed down in the 1-2 month period from the start of the outbreak, our sector companies successfully weathered this difficulty and, adapting rapidly, managed to reinvigorate the sector.

In light of the experience we gained in the first wave of the pandemic, we entered the second wave better prepared, and even conducted sales of finished and semi-finished products in the first three months of 2021.

Additionally, towards the end of the year, both due to lower supply and the revival of demand that had been delayed since 2019, commodity prices rose significantly and this was reflected in final product prices, causing buyers to enter into stock-building behavior. For these reasons, we managed to increase our exports especially in the final months of 2020, and I believe this trend will continue in the first quarter of 2021. Looking at steel production, which is our association's largest export item, since September we have caught up with last year's production performance. Excluding China, the world's largest producer, when global steel sector contracted by approximately 9 percent, Turkey's growth of close to 5 percent is an indicator of our companies' success and that they are in a better position compared to their competitors. Products from our Aegean region's iron and non-ferrous metals exporting companies are sent to more than 170 countries. This number exceeds 220 nationwide. Since 2018, due to measures in the EU and US markets, reorientation towards different markets, particularly Africa and Latin America, had begun. In the second half of this year compared to the previous year, we are observing increases in exports to the Republic of South Africa and Far East countries where we have not been able to make significant sales for many years, particularly Hong Kong, Singapore and Malaysia. Our efforts towards Latin America, which is on our radar, have slowed due to the pandemic but continue. Nationwide, rods, flat hot-rolled and pipes; in our Aegean Region, profiles, rods and construction components constitute our most important export items. Although the construction sector is the sector that receives the most inputs from the steel industry, both in Turkey and worldwide, the automotive and white goods sectors are also important steel-consuming sectors and these sectors require high-value products as inputs.

Our country, particularly over the last 30 years, has made significant progress in both production and quality and continues to do so. While the number of facilities producing higher-value products is increasing, new investments that started before the pandemic are also coming to fruition.

In the medium term, we can say that many products currently being imported will begin to be produced with domestic resources and will make significant contributions to the country's economy. In this context, as an association we have set our 2021 export target at USD 1.4 billion and will continue to implement our work in this direction rapidly. As an association, we have been carrying out work especially on Industry 4.0 in recent years. We define Industry 4.0 as a series of strategies to be built with high productivity, low cost, low energy, innovation, speed, smart cooperation and smart integration, and we believe we will be able to reach new markets more easily in this way. In this context, in order to inform our member companies on this subject and showcase good examples, in October we conducted a digital forum organization with the participation of leading institutions and organizations from Turkey and Germany in the sector, and conducted digital visits to firms in the Bavaria Region that are leaders in Industry 4.0 applications. We aim to make similar organizations a regular practice and convey the latest developments to our members every year. As is known, unfortunately the earthquake that occurred in Izmir in October and the loss of life deeply affected all of us. We unfortunately experienced the reality that buildings kill, not earthquakes. Given that our country lies in an earthquake belt, placing more emphasis on steel construction structures rather than reinforced concrete structures would be beneficial in reducing the damage that would occur in earthquakes. Finally, I wish for the ongoing pandemic process and global contraction to end as quickly as possible for our sector and all people, and for 2021 to bring health, happiness and prosperity.