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MMK delays relaunch of Turkish project due to trade war uncertainty

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MMK delays relaunch of Turkish project due to trade war uncertainty

PJSC Magnitogorsk Iron & Steel Works, or MMK, pushed back the relaunch of hot-rolled steel production at its operations in Turkey due to market uncertainty caused by protectionist measures on the global steel market, said Andrey Eremin, the company's director of economics.

Production was suspended at the site in 2012 due to a global slump in steel prices.

During a conference call earlier in the year, Eremin said the company was on track to restart production at the MMK Metalurji property in early July with potential output of 500,000 tonnes by the end of 2018.

However, the implementation by the U.S. of a 25% tariff on steel imports and a 10% on aluminum imports forced the company to reassess its plans.

"We had completely restored equipment at the plant to working condition, had figured out all the contracts for supplying energy and raw materials," Eremin recently told Reuters, noting that the decision was made before the U.S. introduced the tariffs.

MMK postponed a decision on the relaunch of the Turkish project until November. "We hope that by that point, the transformation on global markets will have ended and there will be clarity," Eremin said.

Eremin also said the company had ceased steel exports to Iran, following threats from Washington that it would impose new sanctions on Tehran, and had redirected the steel deliveries to other markets.

"Even before the introduction of sanctions, deliveries were insignificant," Eremin said. "We even cleared out the port warehouses where stocks were intended for delivery in that direction, and sold off supplies."