Turkish Steel Industry Prepares Diplomatic Offensive Against EU Quota Cuts

Planned quota reductions in Europe, Turkey's largest steel export market, have raised serious concerns across the sector. Steel Exporters' Association (ÇİB) Chairman Candidate Uğur Dalbeler announced that they will launch an intensive diplomatic campaign in both Ankara and Brussels against a potential 50% quota cut.

Emphasizing that Turkey's position differs from other countries, Dalbeler said: "We are part of the European Coal and Steel Community Agreement and a member of the Customs Union. Europe should position us differently." He stated that if quotas are cut by 50% starting in July and the 2022–2024 average is used as the reference period, Turkey's steel exports to Europe could decline by 60–65%, representing a loss of approximately $3 billion.

Traditional Markets Are Now Competitors

Drawing attention to the fundamental shift in the export geography over the past 20 years, Dalbeler noted that until 1997, two-thirds of exports went to Southeast and East Asia — regions that have since become the strongest competitors. He pointed out that while 7–8 million tonnes of steel were sent to the Arabian Peninsula alone in 2008, that figure has now nearly fallen to zero, and North African countries have become self-sufficient through new investments.

According to Dalbeler, competing countries have surpassed Turkey in terms of state support, labor, and energy costs. However, the Turkish steel sector still holds strong cards. "If you order from China, you wait a month. From Turkey, you receive the same material within a week," said Dalbeler, emphasizing that flexibility and fast delivery capacity are the sector's most distinctive advantages. He also added that Turkey maintains its position as the largest supplier of construction steel to the Western world.

Cost Pressures and the Global Price Gap

Touching on price imbalances in the global steel market, Dalbeler noted that the same product sells for $450 in China, $800 in Europe, and $1,100 in the United States. He said that China's exports, which have reached 130 million tonnes, are distorting global balances, but that this situation is not sustainable.

Noting that hourly labor costs in Turkey have risen from $3–3.5 to $10, and that profit margins have virtually disappeared when combined with energy costs, Dalbeler warned that competition will intensify further after 2026. Nevertheless, he recalled that similar difficulties have been overcome in the past: "Turkey has never experienced a decline in exports to date, and hopefully that will continue."

Criticism of State Aid to European Industry

Recalling that under the 1997 European Coal and Steel Community Agreement, Turkey committed not to benefit from state subsidies, Dalbeler noted that Europe today is supporting its own steel industry with grants of up to approximately €30 billion for decarbonization and new facility investments. He noted that a similar process is taking place in the United States, where the American steel sector, restructured following tariffs, has become the country's most profitable sector.

The New Period's Roadmap

Dalbeler, the sole candidate in the upcoming general assembly in April, has set a broad agenda for the new term. Priority goals include Brussels contacts coordinated with Ankara against EU quota regulations, updating Customs Union agreements, emphasizing Turkey's allied identity, and establishing strong legal defense mechanisms against anti-dumping measures.

Strengthening relations in Eastern Europe, Africa, and alternative geographies, joint solutions to energy and financing costs, and technical guidance for members are also among the topics on Dalbeler's agenda. Noting that the tradition of consensus culture within the association will be maintained, Dalbeler said: "We have always moved forward by reaching agreement, and that will continue."

Source: EKONOMİM