View of SBQ Markets from Bursa Tolga Şölen
PRESENTATION PLAN Who we are, where we stand currently. How we view the industries that affect SBQ usage in Turkey and in other markets What challenges and opportunities we expect to face in the future.
ASİL ÇELİK WHERE WE STAND Largest producer of engineering and stainless steel bars and billets in Turkey. Numerous approvals from major OEMs in various sectors such as automotive, defense, machinery, mining, and energy. Commitment to consistent quality, attentive service and continuous improvement
LOCATION İSTANBUL KOCAELİ BURSA
COMPANY HISTORY Asil Çelik founded by Koç Group to meet the special steel needs of the nascent Turkish automotive, machinery and defense industries. Ownership taken over by Turkish government due to sudden devaluation of Turkish Lira. Privatization. Two major holding groups purchased over 99 % of Asil Celik in equal shares. Second set of Ladle Furnace and Vacuum Degassing Units added. (Marti Technologies, Switzerland). Asil Celik Deutschland established in Hilden. & Medium Section Mill modernization completed. 11 stand continuous rolling (Siderimpes, Italy). 1974 1984 2000 2007 2010 1979 1998 2005 2008 2012 Construction completed. Main equipments provided by IHI of Japan. Engineering and consultancy services provided by Thyssen Krupp, Germany and Kaiser Engineers, USA respectively. Continuous casting machine added to the existing ingot route. (Danieli, Italy) New Electric Arc Furnace installed. (Danieli, Italy) Two continuous type quenching and tempering furnaces installed with a capacity of 70.000 tons/year. (Olivotto, Italy) Existing Continuous Casting Machine overhauled. & Due to ownership structure and regulation changes, Asil Çelik becomes a publicly traded company in Borsa Istanbul.
ONGOING AND PLANNED INVESTMENTS Jumbo Caster New 3-strand continuous caster from SMS Concast with ability to cast up to 600mm round blooms Steel Melt Shop Upgrade Details are not finalized yet. Expected capacity 1.000.000 tons / year 2015 Q1 2018-19 Total planned investments: 150 million 2015 Q3 Medium section rolling mill investment New furnace, continuous rolling stands, Kocks Block technology, cooling beds, increased capacity by 250.000 tons/year. Large section rolling mill investment Automation systems, new rolling Technologies, increased capacity by 100.000 tons/year All mill equipments provided by Danieli. Total rolling capacity of approximately 800.000 tons / year
Semi finished billets PRODUCTION PROCESS CONTINUOUS CASTING 4 Strands 10m Radius 5 different cast sizes Billets MEDIUM SECTION ROLLING MILL Walking Beam Furnace Descaling Duo-reversible mill 11 Stand continuous mill MEDIUM SECTION CONDITIONING LINES Straightening Shot Blasting Ultrasonic and Surface Crack Tests RAW MATERIAL PREPARATION EAF 70mtons EBT Type LF / VD 2 LF&2 VD UNITS HEAT TREATMENT LINES 3 Quenching and Tempering Lines 2 Furnaces for various heat treatments PACKAGING & DISPATCH Ingots INGOT CASTING Bottom Pouring Type LARGE SECTION ROLLING MILL Soaking Pits or Walking Beam Furnace Descaling Duo-reversible blooming mill LARGE SECTION CONDITIONING LINES Straightening Shot Blasting Ultrasonic and Surface Crack Tests
INGOTS PRODUCTS CONTINUOUS CAST BILLETS AND BLOOMS HOT ROLLED BARS Square 480 x 480 Square 550 x 550 Polygonal 710 Dimensions (mm) Weight (kg) 2.225 2.850 5.000 Other sizes such as 8.000 kg and 13.000 kg ingots are also available. Dimensions (mm) Square 135x135 3.000-12.000 Square 160x160 3.000-12.000 Square 240x240 2.500-6.000 Rectangular 280x300 2.500-6.000 Round 300 2.500-6.000 New Round Sizes To be Added in Q1 2015 with new caster: 300mm 600mm Length (min max) Dimensions (mm) Round Bars 19 220 Round Corner Square Bars 50 240 Hexagonal Bars 18 67 Rectangular Bars 50-200 x 130-400 Flat Bars 6-60 x 50-120
RANGE OF PRODUCTS Carbon Steels Heat Treatment Steels Case Hardening Steels Micro Alloy Steels Boron Steels Bearing Steels Spring Steels Stainless Steels (Ferritic and Martensitic) Free Cutting Steels (with/without Lead) Wear Resistant Steels High Temperature Resistant Steels Tool Steels (Cold and Hot Working) Nitriding Steels Constructional Steels END USE OF OUR PRODUCTS Automotive Industry Machine & Manufacturing Industry Spring Production Industry Tools Production Industry Military and Defense Industry Bolts and Nuts Production Industry Tubes Production Industry Energy Industry Mining Industry Aircraft Industry
END USE PURPOSE 2,2% 2,5% 1,1% 4,9% 0,3% 0,2% 0,1% Forging Machining Purposes 8,1% 36,2% 44,5% Leaf spring Billet Flats Bar Applications Cold Drawn Bloom for Tubing Mill Grinder Coil Spring Bearing
SOME CUSTOMER APPROVALS
CRUDE SPECIAL STEEL PRODUCTION IN TURKEY Asil Çelik 350.121 72% Others 136.000 28% Companies Capacity (Present) Production (2013) CU % Production Share % Asil Çelik 485.000 350.121 72% 72% Others 153.000 135.504 88% 28% Total 657.000 486.121
PRESENTATION PLAN Who we are, where we stand in currently. How we view the industries that affect SBQ usage in Turkey and in other markets What challenges and opportunities we expect to face in the future.
TURKISH AUTOMOTIVE INDUSTRY 2010 2011 2012 2013 793.172 910.867 817.620 893.124 Market 2014 2015 and Later In a downward trend in 2014 due mainly to additional taxation by government. Compared to 2014 overall decrease in the first half is -% 24. Expectation of domestic market to grow in line with growing economy and income per capita. Taxation change is seen as necessary. High age of vehicles 16 years. 1.124.982 1.234.637 1.115.233 1.166.043 Production 2014 2015 and Later First half is almost leveled with 2013. Strong help from exports. Intention from the administration to develop automotive production. More production of parts, such as engines and gear boxes, then assembly is tried to be motivated. More variety of models for need of domestic market has to be produced. 763.670 801.112 745.354 843.467 Exports 2014 2015 and Later Overall exports up by %8 during the first half. Passenger car exports up by 27%. Turkey is becoming a strong hub for production for exports in the region. The pace will continue with successful long-term FTAs and penetration to new markets All units mentioned in the above table are number of vehicles. Source: OSD www.osd.org.tr
AUTOMOTIVE INDUSTRY General positive trend is observed in the world. Comparison of first half of 2013 and 2014: Global car sales increased by 4%. Highest level since 2006 is expected. EU and EFTA countries, passenger car sales up by 5%, commercial vehicle sales up by 11% China car sales increased by 15% India car market is beginning to rebound
AUTOMOTIVE INDUSTRY Despite Political Uncertainty, The Emerging Mideast Is Expected To Be One Of The Largest Clusters, Outside BRIC, Europe and North America, through 2020
AUTOMOTIVE INDUSTRY The North African Belt Is Expected To Reach New Vehicle Sales of 1.2 Million by 2020
FORGING INDUSTRY 23% of total forgings are produced in Europe. Expectation is that Turkish forging industry would show a healthy growth in the coming years. Source: Euroforge (Figures for 2012) This industry is relatively small when compared to size of the country and size of industries using forged parts such as automotive and equipment/machinery manufacturing. More investments is also expected in these industries due to the growing nature of population and economy in Turkey.
OTHER INDUSTRIES New drilling technologies such as fracking affect steel usage with heightened drilling activity throughout the World, mainly in North America. Renewable energy industry is also an industry that is still developing and consuming considerable amount of steel. Mining and heavy construction equipment, general machinery industries, despite a trend of production move Eastwards, still present potentials for SBQ producers in Europe and America. Strong demand and production growth in Turkey for machinery. Currently imports double the exports..
PRESENTATION PLAN Who we are, where we stand currently... How we view the industries that affect SBQ usage in Turkey and in other markets What challenges and opportunities we expect to face in the future...
CHALLENGES AND OPPORTUNITIES FOR FUTURE While increasing the value added nature of our products, maintaining a balance with risks of costly investments in order to upgrade production technologies
CHALLENGES AND OPPORTUNITIES FOR FUTURE Managing and/or hedging against major cost items such as electric, scrap, natural gas. Difficult task to do in Turkey, mainly dependent on imports for these resources.
CHALLENGES AND OPPORTUNITIES FOR FUTURE Flexibility requested by customers, not in production only, but also in services offered. Logistics and stock programs are becoming more and more common practice.
CHALLENGES AND OPPORTUNITIES FOR FUTURE Positioning ourselves in an industry which is already operating at an over-capacity status. Also, calculating risks of China and India becoming more active in export markets. POSITIONING
CHALLENGES AND OPPORTUNITIES FOR FUTURE Opportunities are present in geographically close markets for steel usage in mid-tolong term. Resolution of conflicts, lifting of embargos, further industrialization etc.
Thank you! Tolga Şölen