Although the past trading week was not characterized by a specific event, we are seeing some movement in the Turkish Hazelnut Market. What sellers and buyers have in common is that most have now finished thinking about the 2023 harvest and are now focusing on the 2024 harvest. However, expectations are different. Just as in the previous season, most buyers have the information that a large harvest is coming and conclude that prices will then have to fall. On the sellers' side, on the other hand, there is not much optimism left regarding a downward price correction. A certain skepticism is now beginning to spread in the market.

An active TMO

This week there was a meeting at the Ministry of Agriculture at which it was discussed that the TMO should remain active in the coming year. The trend seems to be clear.

• After the TMO started the first tender for the 2022 harvest at TRY 124/kg, the price was raised to TRY 125/kg after just a few weeks and has now been at TRY 126/kg since the first of June.
• There are therefore increasing signs that the TMO will set a minimum price of at least 130 - 140 TRY/kg for the 2024 harvest.
• By way of comparison, TRY 117/kg was still being asked for the current harvest on the free market this week.
• Interestingly, the TMO was able to sell around 3,500 mt at TRY 125/kg last week.

Price differences

Although this trend is becoming apparent, it is still the case that the price lists of the various exporters for prompt loading, but above all for the coming harvest, differ from one another. Price differences of around one euro per kilogram are currently not uncommon. Some buyers are therefore taking advantage of the (speculative) offers at the moment and are already carrying out cover into the first quarter of 2025.

Costs of raw materials

We expect the trend to continue in the coming weeks. The Turkish lira remains quite stable against the euro/US dollar, so there is currently little reason to speculate on the decline of the Turkish lira. The commodity prices we are currently seeing in the open market are likely to be the lowest for months to come. We therefore assume that, as in the previous year, some buyers will still conclude certain transactions and carry out partial cover. However, the mark-ups for the financing costs of raw materials for later dates are likely to remain a point of discussion.

Quality speculations

Another issue that exporters are currently speculating about is the quality of the future harvest. Many fear massive quality losses in natural produce due to the presence of the marmorated stink bug. As a result, the willingness to take risks with regard to the coming harvest is significantly higher for processed produce than for natural produce, especially in the eastern Black Sea region.

What we can already say is that the coming season will be no less challenging than this one. Although we do not expect prices to jump as much as last year for the time being, there is still a risk of fluctuations, especially at the start of the harvest.

Bullet points

• Both buyers and sellers are now increasingly interested in the 2024 harvest.
• The TMO is continuing to turn the price screw slightly, but steadily. Therefore, no price slide is expected for the coming harvest. However, not all market participants see it that way.
• The heterogeneity of the export price lists remains very high. This applies to prompt shipments, but also to offers relating to the 2024 harvest
• Uncertainty in combination with attractive offers leads to a strategy of partial cover for some buyers.
• There is still little change in the exchange rate.