IMPORT – EXPORT RELATIONS

AND

BASIC RULES OF

WHEAT TRADE IN TURKEY

February 17, 2018, Dubai / UAE

Middle East Grain Congress-2018

AGENDA

1-TURKISH AGRIFACTS

2 – WHEAT ROLE IN TURKISH AGRICULTURE

3 – TURKISH WHEAT & DERIVATIVES TRADE

4- TMO, TURKISH GRAIN BOARD

5- 2018/2019 SEASON PROSPECTS

6- SUMMARY

1- TURKISH AGRIFACTS

TURKISH AGRIFACTS

Turkish Population ( 2018 ) : 80.8 MlnsAgricultural Employment Rate : 20%Economic Magnitude: 850 Mlrd USDGlobal Rank: 16th

Growth Rate ( 2017 ): 7.5%GDP Per Capita ( 2017 ) : 10.500 USDAgricultural Value : 100 Mlrd USDGlobal ( 3.2 Trillion USD ) Share: 3%Turkish AgriExports : 17 Mlrd USD ( 11% of Turkish total )Turkish AgriImports : 17 Mlrd USD ( 8% of Turkish total )

2- WHEAT ROLE IN TURKISH

AGRICULTURE

TURKEY HAS AROUND

78 MLN HA OF ACREAGE

INCLUDING

24 MLN HA OF ARABLE AGRICULTURAL LAND

( APPROX 30% SHARE )

APPROX. 11.5 MLN HAOF TURKISH ARABLE

AGRICULTURAL ACREAGE TOTAL ( 24 MLN HA )

BELONGS TO THE CEREALS COMPRISING

- 7.7 MLN HA OF WHEAT- 2.75 MLN HA OF BARLEY- 0.7 MLN HA OF CORN- 0.35 MLN HA OF OTHERS ( PADDY RICE, RYE, OATS, TRITICALE ETC ).

IN 2017/18 SEASON;

TURKEY RAISED AROUND 36.5 MLN T OF CEREALS COMPRISING

- WHEAT, 21.0 MLN T ( 16/17, 18 ),- BARLEY, 6.5 MLN T ( 16/17, 5.0 ),- CORN, 6.0 MLN T ( 16/17, 6.4 ),- OAT, 250 KMT ( 16/17, 200 ),- RYE, 325 KMT ( 16/17, 300 ).

IN 2017/18 SEASON;

21.0 MLN T ( 2016/17, 18 ) OF TURKISH WHEAT OUTPUT HAS BEEN COMPRISING

4.15 MLN T ( 16/17, 3.6 ) OF DURUM

16.85 MLN T ( 16/17, 14.4 ) OF OTHERS ( MAINLY MILLING )

IN 2017/18 SEASON;

WITH 21.0 MLN T ( 2016/17, 18 ) OF WHEAT ( ALL SPECIES ) OUTPUT

TURKEY HAS

10TH RANK ( EU LEADERSHIP )

IN GLOBAL OUTPUT ( 757.5 MLN T )

HOWEVER, IN 2017/18 SEASON;

WITH 4.15 MLN T ( 2016/17, 3.6 ) OF DURUM WHEAT OUTPUT

TURKEY HAS

3RD RANK ( AFTER CANADA AND ITALY )

IN GLOBAL OUTPUT ( 36.5 MLN T )

3- TURKISH WHEAT & DERIVATIVES TRADE

TURKISH WHEAT OUTPUT OF 21.0 MLN T IN 2017/18 SEASON WILL BE CONSUMED AS

- FOOD ( FOR WHEAT FLOUR, PASTA/MACARONI, BULGUR/CRACKED

WHEAT, SEMOLINA, BISCUIT, STARCH ETC ) OF 17 MLN T,

- SEED OF 1.7 MLN T,

- FEED OF 1.3 MLN T,

- OTHERS ( LOSSES ETC ) OF 1.0 MLN T.

TURKISH WHEAT FLOUR OUTPUT

IS AROUND 17.5 MLN T

LOCAL TURKISH WHEAT FLOUR OUTPUT

CAPACITY IS OVER 30 –35 MLN T WITH MORE

THAN 700 SMALL, MEDIUM AND LARGE-

SCALE MILLERS.

WITH OVER 80 MLN OF LOCAL POPULATION, PLUS REFUGEES AND TOURISTS, TURKISH

WHEAT FLOUR CONSUMPTION IS

AROUND 14 MLN T.

THE BALANCE OF 3.5 MLN T OF WHEAT FLOUR

HAS BEEN EXPORTED AND SO TURKEY IS

THE BIGGEST GLOBAL EXPORTER.

TURKEY APROX. PERFORMS 1/3 OF

GLOBAL WHEAT FLOUR TRADE WITH MAIN

DESTINATIONS OF IRAQ, SYRIA, SUDAN, ANGOLA,

PHILIPPINES AND MADAGASCAR.

TURKISH PASTA/MACARONI

OUTPUT IS AROUND

1.75 MLN T

LOCAL TURKISH PASTA OUTPUT CAPACITY IS

AROUND 2.0 MLN T WITH NEARLY 25

FACTORIES.

TURKISH PASTA/MACARONI CONSUMPTION IS

AROUND 750 THD T.

THE BALANCE OF 1.0 MLN T OF

PASTA/MACARONIHAS BEEN EXPORTED AND

SO TURKEY IS THE SECOND BIGGEST GLOBAL EXPORTER FOLLOWING ITALY.

THE MAIN DESTINATIONS OF

TURKISH PASTA/MACARONI

EXPORTS ARE ANGOLA, BENIN,

SOMALI AND TOGO.

EXCEPT UNFAVORABLE WEATHER-SUFFERED

SEASONS,

TURKEY IS ALMOST SELF-SUFFICIENT COUNTRY

FOR WHEAT.

HOWEVER, TURKISH GOVERNMENT PROTECTS LOCAL

FARMERS WITH IMPORT-DUTY ( 45% NOW ) AGAINST CHEAPER

IMPORTS. AND SO, TO BE COMPETITIVE AT EXPORT

MARKETS, THE GOVERNMENT GRANTS LOCAL FACTORIES DUTY-FREE IMPORTS UNDER

INWARD PROCESSING REGIME.

AT THIS POINT;

IN 2017 CALENDAR YEAR,

TURKEY IMPORTED

4.57 MLN T ( 2016, 3.47 ) OF WHEAT.

THE MAIN ORIGINS OF TURKISH WHEAT IMPORTS WERE

- 2.85 MLN T OF RUSSIA,- 570 THD T OF LITHUANIA,- 435 THD T OF UKRAINE AND- 161 THD T OF LATVIA.

4- TMO, TURKISH GRAIN BOARD

http://www.tmo.gov.tr

TMO, TURKISH GRAIN BOARD, ESTABLISHED

IN 1938, WAS THE MAIN STATE

STRUCTURE IN GRAIN MARKETS,

INCLUDING WHEAT.

THE MAIN MISSIONS OF TMO ARE

- TO TAKE PROTECTIVE MEASURES FOR PRODUCERS AND CONSUMERS

BY REGULATING AGRICULTURAL MARKETS, ESPECIALLY GRAIN

MARKETS,

- TO KEEP STOCKS FOR THE STATE OF EMERGENCY.

TMO HAS BEEN ANNOUNCING

PURCHASING AND INTERVENTION PRICES FOR FARMERS, SELLING

THE STOCKS FOR THE LOCAL FACTORIES.

IN SOME SEASONS, IF NEEDED, THE

GOVERNMENT ALSO APPOINTS THE RELEVANT STRUCTURE TO PERFORM THE IMPORTS AND/OR

EXPORTS UNDER INTERNATIONAL TENDERS.

5- 2018/2019 SEASON PROSPECTS

DUE TO DRIER FALL 17, THE PLANTINGS COULD

NOT BE DONE IN DUE TIME AND AS INTENTED IN

ANATOLIA ( ASIAN PART OF TURKEY ) MOSTLY, SO

SOME ACREAGE CUTS WERE UNFO EXPERIENCED.

IN ADDITION, RAINS AND ESPECIALLY SNOWS ARE LESS THAN EARLIER YEARS SO FAR.

INDEED, IT’S EARLY TO SPEAK, BUT IF CURRENT PARTLY

UNFAVORABLE WEATHER CONDITIONS ARE KEPT TILL THE

HARVESTINGS AND DURING HARVESTINGS ( LATE MAY-JUNE-

EARLY JULY ), FURTHER LOSSES ARE POSSIBLE.

TENTATIVELY, TURKISH WHEAT NEW-CROP SIZE MAY BE AT

17 – 19 MLN T RANGE, IE 2 – 4 MLN T

LESS THAN CURRENT YEAR’s 21 MLN T.

BY ASSUMING STILL HIGH PACE OF WHEAT FLOUR AND

PASTA/MACARONI EXPORTS FOR 2018/19 SEASON, TURKEY MAY NEED HUGE WHEAT IMPORTS UNDER DUTY-FREE INWARD PROCESSING REGIME. TMO MAY ALSO ANNOUNCE DUTY-

FREE INTERNATIONAL IMPORT TENDERS TO CURB LOCALLY HIGHER PRICES. CURRENT 45% OF IMPORT-DUTY MAY BE ALSO LESSENED EVEN

ZEROIZED.

6- SUMMARY

• TURKEY IS AMIDS THE MAIN PLAYERS IN GLOBAL WHEAT OUTPUT ANDTRADE.

• TURKEY IS THE LEADER GLOBAL WHEAT FLOUR EXPORTER ( TO MORETHAN 120 COUNTRIES ) BY PERFORMING 1/3 OF GLOBAL WHEAT FLOURTRADE.

• TURKEY IS THE SECOND BIGGEST PASTA/MACARONI EXPORTER ( TO MORETHAN 150 COUNTRIES ) AFTER ITALY.

• NORMALLY, TURKEY IS SELF-SUFFICIENT IN WHEAT, BUT TO BE COMPETITVEIN WHEAT FLOUR AND PASTA EXPORTS, GOVERNTMENT GRANTS DUTY-FREE ( NORMALLY, 45% ) IMPORTS UNDER INWARD PROCESSING REGIME.

• TMO, TURKISH GRAIN BOARD, IS THE PUBLIC STRUCTURE TO REGULATETHE LOCAL MARKETS AND KEEP THE STOCKS FOR THE STATE OFEMERGENCY.

• WEATHER CONDITIONS SO FAR ARE NOT FAVORABLE IN ANATOLIA, ASIANPART OF TURKEY, MOSTLY AND SO TUR NEW-CROP SIZE MAY BE 2 – 4 MLN TLESS THAN CURRENT 21 MLN T.

• IF SO, BY KEEPING STILL HIGH PACE OF WHEAT FLOUR AND PASTAEXPORTS, TURKEY MAY NEED MORE WHEAT IMPORTS. TMO MAY ALSOANNOUNCE INTERNATIONAL DUTY-FREE IMPORT TENDERS.

Great thanks for your kind attention…

Teşekkürler…

Большое спасибо…

شكرا

THE EXPERT SUPPORT ON REPORTING, ANALYSES, CONSULTING AND BROKERAGE AS PER OVER 20-YEAR SECTOR

EXPERIENCE ( SINCE 24 DECEMBER 1998 )

VEYSEL KAYAhttp://www.sunseedman.com

veyselkaya@sunseedman.comSKYPE : SUNSEEDMAN

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