Ekin Maden has been the number one non-ferrous metal supplier in Turkey for over a decade. Can you give us an overview of the company’s main activities today?

SL: We separate our activities into metal trading, our main business, and ore and concentrate trading. We are also the leading exporter of chrome and zinc oxide from Turkey. Until 2008 we were the biggest sulfide zinc and lead concentrates producer in Turkey but we sold these assets. We have a joint-venture company which produces silver and gold and this year invested in two non-operating mines to do geological research and may therefore produce sulfide lead and zinc again by 2019. 

CY: Ekin Maden imports zinc, lead and aluminum ingots and copper cathodes, and in the zinc and lead market we are the leading company. Meanwhile we also export zinc oxide ore, sulfide zinc, lead and copper concentrates, as well as lumpy chrome ore, concentrate chrome, iron ore and manganese ore.

Where does Ekin Maden source the ores that it exports and why should producers partner with Ekin Maden?

CY: There are many different producers in Turkey and they are all potentially our supplier. For example, there are more than 200 chrome ore producers all of which we could work with. We are a financially strong company and have had a good reputation since 1982; they all prefer to work with us because they can trust us to get them financed.

Companies approach us to get long-term financing and secure long-term sales, which can be difficult for them as they mainly sell raw materials to China which is a volatile market. We also give them engineering support free of charge, warehousing and logistics and pay their VAT. We spend money, time and effort on marketing their materials but they do not incur costs for this and have no product risk as we buy on loading port results and sell on Chinese inspection and quarantine results, so we take the risk.

Other than China, where else are important export markets for Ekin Maden?  

SL: For the last two years, Iran has been the biggest buyer of zinc oxides as their processing plant is close to Turkey by rail so transportation costs are low. The Chinese are still buying roughly 50% of zinc oxides, whilst Iran takes the other half. We also sell small quantities of zinc to South Korea.

CY: We also sell to Ukraine, South Africa, Brazil, Germany, Slovenia, especially for chrome. However, 99% of chrome products go to China.

From where does Ekin Maden import ingots and cathodes and who are Ekin Maden’s typical clients for these?   

CY: We have a long-term contract with Glencore for zinc and lead ingots and copper cathodes, and they supply from nearby countries. We supply aluminum ingots from nearby countries by ourselves. Our customers are galvanizing, automotive, battery companies etc. We supply 75% of Turkish consumption for lead and zinc ingots and we are the market maker.

Ekin Maden is the largest mining company in Albania and it has a newly built flotation plant there. Can you tell us more about the scale of these operations?

SL: We have seven copper mines but we are only working on one of them. We have a big project and are now looking for financing. We are using one of the plants and have another in case of emergencies. Because of low copper prices we stopped production for 20 months but just recently started producing concentrate again. We have a 50-50 joint-venture with Jiangxi Copper, the biggest copper producer in China and second biggest in the world, and are looking for more opportunities in the Balkans.

We are also investing in nickel in Albania. Furthermore, Ekin Maden just won a tender to enter into a joint-venture with an Albanian company and should be producing chrome by the end of the year, and will combine our own production with trading.

Turkey’s economy grew by 7.4% in 2017 but currently inflation is high and the lira has depreciated. How positive is the macro situation in Turkey for a company like Ekin Maden?

SL: Turkey is a leading country for construction both domestically and in other countries; Turkish companies here are increasingly getting contracts for building airports, roads, and other infrastructure projects abroad. Domestically, because of pressure on the lira, construction companies may experience lower sales. Nevertheless, Turkey has a growing population so there will always be a need for construction. In the last fifteen years, Turkey became more engaged with Arab countries and there is much demand from them in Turkey now, especially given the lower lira. Also, the government is lowering taxes and stimulating credit for housebuilding. There are many people employed in construction so the government wants to keep it going.

CY: Exchange rates effect our imports but costs which are also dependent on LME prices internationally; a strong dollar will mean metal prices reduce. Turkey is still a growing country and it needs these materials so demand will continue.