Turkish steel exporters are experiencing an increase in orders for July after the U.S. hit key allies the European Union, Mexico and Canada with steel and aluminum tariffs.
The Trump administration said last Thursday it was moving ahead with tariffs on aluminum and steel imports from Canada, Mexico and the EU, ending a two-month exemption and setting the stage for a possible trade war.
In order to protect the U.S. domestic steel industry, President Donald Trump in March announced a 25 percent tariff on imported iron and steel, and a 10 percent tariff on aluminum on some countries, including Turkey.
Trump exempted Canada, Mexico and the EU to buy time for negotiations, which were to expire at midnight last Thursday. Dissatisfied with the negotiations, Trump lifted the exemptions, in a move likely to provoke counteraction from trade allies, as of June 1.
While no tariff was levied on Australia, quota decisions were brought for South Korea, Brazil and Argentina.
The inclusion of the EU, Canada and Mexico in the steel and aluminum tariff application has put Turkey in an advantageous position, Steel Exporters Association (ÇİB) Chairman Adnan Aslan told the Turkish daily, Dünya yesterday.
"Australia, Argentina, Brazil and South Korea were exempted from this tariff and a quota was introduced. These quotas will eventually end and they will come to us. In fact, demands have already begun to go up. I see that orders for July have already begun to arrive," the ÇİB chairman said.
He said that Turkish steelmakers will catch up with last year's export figures in 2018. He added that at the end of the year, they will export 25 percent more to the U.S. on a value basis. "On the quantity basis, we will be very close to last year. We have experienced losses in the first months but it looks like will close it in the third and fourth quarter."
Turkey's steel exports to the U.S. stood at $1.12 billion in 2017. Meanwhile, Turkey's total steel exports in the said year stood at $8.25 billion.
Steel Federation Chairman Namık Ekinci also thought Turkey was in an advantageous position in steel exports to the U.S.
"The introduction of 25 percent steel tariff on Mexico, which was our biggest rival, has brought us to an advantageous position. After the developments, construction steel prices in the U.S. are going towards $900. Even with the additional tariffs on
our price of $550, it will remain below $900 when it arrives in the U.S. market. We are being competitive even if we remain $30 below the U.S. companies. The U.S. will come to us. The orders have already started to arrive," he said.
The EU had launched an anti-dumping investigation concerning some steel products from Turkey on March 27. The Turkish steelmakers demanding an appointment for this issue have received a positive response from the EU. A delegation composed of members of the Steel Exporters Association will discuss the issue in the EU Parliament in Brussels today.
The tariffs introduced by the U.S. will also be discussed during the meeting. "We are expecting the EU to be smothering toward us because the U.S. has imposed the 25 percent tariff on the EU countries as well. We will tell them that we should come together and unite strengths against the U.S. The EU is exporting more steel to us than the U.S. They can accept this offer," Ekinci said.
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