Turkish Construction Material Industrialists Association (Turkey İMSAD) announced the results of its monthly Foreign Trade Index for June. Featuring the latest data, according to the report, export figures of the construction materials industry, which declined in May as a result of lesser number of working days due to official holidays, broke records on both monthly and annual basis in June. Average unit prices increased by 28.5 percent while the highest rate of export was realized since August 2013, when the index started to be measured.
The construction materials industry broke two new records in exports according to the June figures of the Construction Materials Industry Foreign Trade Index prepared by Türkiye İMSAD, the umbrella organization of the construction materials sector. While the monthly export figures reached its historical peak with 3.36 billion dollars as of the end of June, the annual exports broke a record with 34.52 billion dollars. The highest export figures were realized in value in this period, while the average unit price increased by 28.5 percent.
Demonstrating a high performance in foreign trade in June, the construction materials industry realized 5.31 million tons of exports with a more limited increase in quantity.
Annual (last 12 months) export figures decreased to 63.56 million tons in terms of quantity, while the annual average export unit price was at the rate of 0.54 dollars/kg.
In June, the export unit price index rose to the highest level with 108.98 points since January 2015. The average export unit price which was 0.49 dollars/kg in June 2021 reached to 0.63 dollars/kg in June 2022 with an increase by 28.5 percent.
The increase in imports also continued in this period. Construction materials import reached to 957 million dollars in June 2022 with an increase by 27 percent compared to the previous year. The highest figures of the year were reached in terms of value and quantity as well. Construction materials imports amounted to 336 thousand 613 tons and the import unit price was 2.84 dollars/kg in June.
Completing the first half of the year with the highest rate in history, construction materials industry exports are expected to be under influence of the effects of the war, high global inflation and recession concerns in the next six months. The annual export magnitude at the end of the year is expected to be higher than last year despite forecasts that anticipate a decline in export unit prices.
Exports in certain sub-sectors started to decline in terms of quantity
Increases in value resulting mostly from unit price increases were observed when the export performance of construction materials in June is compared with the previous year by sub-sectors. Declines started in terms of quantity.
In June 2022, export unit prices increased in all eight product subgroups compared to June 2021 with the influence of the high course of global commodity and final product prices.
The average annual export unit prices of iron and steel products increased by 34.5 percent, mineral, stone and earth products by 26 percent, prefabricated products by 30.1 percent, wood and wood products by 21.6 percent and metal-based products by 32.4 percent in this period compared to the same month of the previous year.
Exports in June 2022 were lower than of the previous year in terms of quantity in five of the eight sub-product groups. The base effects of last year’s high increases began to appear in the declines in terms quantity and increase only happened in only three sub-products in terms of quantity.
In June, increases in export were 15.4 percent and 29.5 percent, in chemical-based products and insulation materials, respectively, in terms of quantity. Exports of mineral, stone and earth products decreased by 8.7 percent and iron and steel products by 14.3 percent, in terms of quantity.
Major increases were realized in the export of all eight sub-product groups in terms of value. It increased by 31 percent in insulation materials, 30.6 percent in metal-based products, 25.3 percent in prefabricated structures, 21.2 percent in chemical-based products and 20.2 percent in wood and wood products.
Additional demand for Turkish industrial goods continues despite the effects of the war
The second highest monthly exports of the year were reached in June following the decline in Turkey’s industrial exports due to the lesser number of working days in May. Industrial products export reached to 17.34 billion dollars in terms of value in this period.
Additional demand for Turkey continues to increase along with the effects of the war between Russia and Ukraine. High export unit prices are still contributing to the exports. In June, Turkey’s total exports of industrial products were 11.19 million tons in terms of quantity. Average annual export unit prices continued to remain high despite a slight rate of decline. The average unit prices of industrial goods exports reached to USD 1.55/kg in June 2022 while it was USD 1.44/kg in June 2021.
The global increase in commodity and finished-global product prices has a determinative role on unit prices. Recession concerns are causing downward pressure, while the ongoing war is pushing up the prices. Additional demand for Turkey’s industrial goods has been rising since the beginning of the year. It is expected that both the escalating impacts of the war between Russia and Ukraine on markets and recession concerns will limit industrial exports in the forthcoming months.