Turkey’s steel exports to the United States halved in the first five months of the year after U.S. import tariffs were imposed, but they may bounce back now that other producers face the same levies, a Turkish industry leader said.
In a move that ignited fears of a global trade war, U.S. President Donald Trump in March imposed a 25 percent tariff on steel imports and a 10 percent tariff on aluminium imports.
The tariff slashed Turkey’s steel exports to the United States by 56 percent to just below half a million tonnes between January and May, while it led to a 5 percent contraction in its overall steel exports in the same period, as the United States was its biggest export market before the tariff.
Trump had granted a two-month exemption to the European Union, Canada and Mexico but he removed the brief relief as of June 1, a rare bright spot for Turkey’s exports, said Adnan Aslan, head of steel exporters association (CIB).
“As long as the United States continues to impose 25 percent tariffs on all countries, Turkey is at a great advantage,” he told reporters late on Tuesday, adding that following the removal of the exemption, there had been substantial increase in steel orders for June and July.
Turkey’s steel producers say despite the tariffs they remain competitive, thanks to lower production costs.
“We will be seeing the impact of these increased orders in export figures in July and August,” he said, adding he expected the overall steel exports to reach 18 million tonnes in 2018, slightly up from the 17.8 million tonnes last year, despite the 5 percent contraction in the first five months.
In financial terms, exports would hit $15 billion in 2018, rising 30 percent compared with last year, Aslan said.
Turkey is the eighth-largest steel producer in the world. Following the imposition of tariffs, the United States is now its third biggest market for the commodity.
Increasing costs due to the weakening Turkish lira and anti-dumping cases have also weighed on Turkey’s steel market in 2018, Aslan said, but added that domestic demand remained strong on the back of state-sponsored infrastructure projects.
Turkey started implementing last week retaliatory tariffs worth $266.5 million against the United States over “ill-advised” and “unsupportable” additional steel tariffs enacted by Washington.
The United States is the fifth largest country where Turkey exports its goods and trade volumes amounted to $20.6 billion in 2017, official data showed.