Turkish base oils slow - GSP changes add to legislation complications

14 January 2014 23:59 Source:ICIS News

LONDON (ICIS)--Turkish base oil imports remain extremely limited with a number of new legislation changes, sources said on Tuesday.

Market participants in Turkey are talking of an extremely thin market with very few deals done.

“We are starting to receive some calls but not as much as expected”, said one importer.

The market is talking of legislation difficulties including new import licences and additional deposits needed at port as well as changes to the Generalised System of Preferences (GSP).

Turkey’s GSP is linked to the European Union’s and included preferential import rates for less developed countries.

As of 1 January 2014 Russia lost less developed status under the scheme. Imports from Russian, or some other Black Sea countries, into Turkey are now subject to an additional 4.5% tax.

This has had a further dampening impact on any already slow import business.

Even local producers talk of limited trades

“We are selling some product, but compared to last year it is lower”, said one producer.

Some importers had hopes that buyers inventories were getting low with limited purchases since November. However most buyers seemed very happy with stock levels.

“We have product, bought before Christmas”, said one buyer.

In this environment, with limited news on trades, pricing remains unchanged at $885-900/tonne FOB (free on board) Black Sea.

By Rhian O'Connor