Banks are reportedly becoming increasingly reluctant to write letter of credit (L/C) business for transactions between Turkish sellers and western buyers of steel following Washington's decision to double tariffs on steel and aluminium imports from Turkey and threats from US President Donald Trump's of more punitive sanctions to come.

But Turkey's steelmakers say they will increasingly look to Asian markets to replace sales of steel to US and western markets.

Sanctions threats

The US president has threatened to slap "large sanctions" on Turkey unless Ankara frees an American pastor whose detention has strained relations between the two countries.

"The United States will impose large sanctions on Turkey for their longtime detainment of pastor Andrew Brunson," Trump tweeted.

Vice President Mike Pence also wrote a tweet saying Washington would impose "significant sanctions on Turkey until this innocent man of faith is free".

Asian steel outlook

But the CEO of a major Turkish steel company said he was confident Turkey will continue to find outlets for its finished steel products as global demand remains strong.

The executive, who spoke to the Platts news outlet, said L/Cs were becoming harder to come by for transactions with customers in the west so steel producers would increasingly look to Asian markets to sell their steel.

Bright prospects

"China's domestic consumption is good," the executive said, adding that this provides plenty of scope for Turkish steel exports.

The CEO added that two steel producers reported selling larger volumes of steel to Singapore and Hong Kong, while another steelmaker sold a large shipment to Singapore this week.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.