Although a market price slowly formed towards the weekend in Turkish hazelnut market, this week was still characterized by uncertainty. At the beginning of the week, the mood among exporters was still very reserved and they were very cautious about giving a price. Towards the end of the week, the tendency was for the price on the free market to settle between 118 - 120 TRY/kg, although there were still no transactions at these prices as the crop is not yet available.

Rumors about quality

From next week, the picking of the kernels will also begin in the somewhat higher regions, and the first results regarding the quality of the kernels already harvested will also be available. There are increasing rumors about quality problems, but there is still a lack of representative data. This can only be assessed at the end of August, until then such statements should only be noted. However, it is noticeable that some exporters are now becoming rather restless and are tending to offer more conservatively. In addition to the uncertainty with regard to quality, it was also the reaction of the TMO that led to a little more caution in the market. From next Monday, farmers will be able to book appointments to deliver their harvest to the TMO. Up to now, this option has been little used, as the long payment period of 45 days has been a hindrance for farmers. The TMO has now corrected this and reduced the period to 25 days. This is an indication that there is a willingness to buy and a signal to the market that the TMO will have some influence on the volume flow.

Different prices

If you look at the exporters' price lists, you can currently see an enormous range in prices. On the one hand, this is due to expectations, but also to exchange rate speculation through options of the respective banks that predict a devaluation of the Turkish lira. As a result, there were also a number of trades on the market this week, as investors did not want to miss out on this option. However, interest is still focused on the fourth quarter. Beyond that, there is still little genuine buying interest.

In general, we expect the search phase to continue in the coming week. Harvest information and weather forecasts will have an influence, as will the number of registrations with the TMO, with many farmers booking appointments but then not keeping them. The market leader is not expected to make a purchase offer until the beginning of September. We therefore expect little change in the coming week, although interest will continue to increase.

In terms of the exchange rate, we have also seen little change this week. Although the Turkish lira is trending slightly weaker, fluctuations of around 1% are nothing special compared to the past. There are no decisions to be made by the Turkish central bank next week, so we expect little change in the coming week.

Bullet points

• Commodity market in the discovery phase. The free market is currently trending at around TRY 10/kg below the TMO purchase price (TRY 130/kg)
• Reports of quality problems are increasing, but a representative picture is not yet possible.
• Exporters' price lists remain very heterogeneous due to differing expectations and options in forward exchange transactions.
• The buyer's market is characterized by individual purchases, great interest in information and the tendency to continue to only make short-term covers.
• From next week, farmers will be able to book delivery dates with the TMO.
• There is still little movement in the exchange rate