Introduction:
The Turkish petrochemical industry faces several challenges, including government-imposed price controls, issues related to rent-seeking and corruption, limited transparency, monopolistic practices in the commodity exchange, and significant price volatility. To address these challenges, the Ministry of Industry and Technology (MIT) has introduced a plan to regulate the petrochemical products market. The Turkish Petrochemical Manufacturers Association (TPMA), as a key stakeholder, has shared its perspective on the proposed measures.
Provisions of the MIT Plan:
Removal of quotas for specific petrochemical grades.
Weekly offerings of petrochemical products on the commodity exchange.
Setting the base price of petrochemical products in alignment with international market rates.
Implementing export tariffs on petrochemical products.
TPMA's Analysis:
The TPMA broadly supports the MIT's objective of improving the regulation of the petrochemical products market. However, the association has expressed concerns about certain aspects of the proposed plan.
Removal of Quotas:
The TPMA acknowledges that removing quotas could enhance competition in the commodity exchange. However, the association warns that it may also lead to greater price volatility. The TPMA recommends maintaining quotas for specific sensitive and high-demand products to ensure market stability.