Turkiye agreed on a mechanism to control steel prices for reconstruction

Turkiye’s trade ministry and the country’s steel producers have agreed to set up a price control mechanism to prevent speculation in a meeting to supply steel products for reconstruction projects in earthquake-hit regions. Eurometal informs about it with the reference to S&P Global.

During 2023, the Housing Authority of Turkiye plans to build 350,000 houses in the affected southeastern part of the country. According to calculations, this will require 5 million tons of steel products, including 3 million tons of rebar, 750,000 tons of wire rod, and 1.25 million tons of sheet steel.

Representatives of the steel industry noted that these volumes can be satisfied by the domestic market. At the same time, there was talk of increasing prices for raw materials and steel products after the earthquakes.

When detailing costs at the production stage, steel producers paid attention to the share of raw materials and energy in the cost of production. Government officials and steelmakers have reached an agreement that there will be no increase in the prices of rebar, except for fluctuations in the prices of raw materials. In addition, a price control mechanism was agreed to prevent speculation in the market.

Imported billet and scrap prices have risen domestically in recent weeks due to demand for steel for reconstruction projects. The necessary volumes, producers note, can be obtained by contracting organizations focusing on the domestic market.

As GMK Center reported earlier, Turkiye stabilizes prices  of construction materials, including steel products, for the reconstruction of areas affected by earthquakes, said Veysel Yayan, CEO of the Turkish Steel Producers Association (TCUD). He noted that the country has enough production capacity to meet the expected increase in demand for steel. At the same time, most long-rolled steel producers have stopped accepting rebar orders from Turkish exchanges and traders.