Hazelnuts: new round of chaos

September 26, 2022 at 11:36 AM, Der AUDITOR
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ORDU. Turkey’s Central Bank once again stunned the market on Thursday by cutting interest rates further. Although this move is designed to boost short-term economic growth, president Recep Tayyip Erdoğan’s policies are currently strangling Turkey’s hazelnut exports.

Failure to get back on track

While inflation hit a 24-year high in August at 80.2%, the bank decided to cut interest rates by 100 basis points and brought the key rate down to 12% on Thursday. In so doing the Central Bank continues to act against economic reason. As news agencies report interest rates were gradually cut by 500 basis points in 2021 and by a further 100 basis points in August thereby accelerating an unprecedented currency crisis. The lira’s loss exceeds 27% against the dollar since last year and worse is in store as economists believe that the lira will trade as low as 24 against the US dollar in March.

Support is dwindling fast for Erdoğan and his ruling AK Party as people and businesses are struggling to make ends meet. Basic living costs have surged and the ongoing war in Ukraine is driving up the prices for energy, gas and fertilisers. Financially, the government is relying on foreign currency inflows to support the lira and practically on boosting short-term economic growth and implementing spending projects ahead of the general elections, which will be held on 18 June. These measures, however, fail to provide the economy with a sustained impulse to get back on track again.

Hazelnut exporters forced to part with income

This situation has very direct and unpleasant implications for the hazelnut market. While producers are happily selling to the TMO, which offers way above the current market prices for inshell hazelnuts (TRY 52-53/kg vs TRY 43-44/kg), it is next to impossible for exporters to compete due to financial restraints. In recent months they have been forced to deposit foreign currency incomes in special accounts and the banks are presently refusing to issue loans in Turkish lira, which is leaving even big exporters to struggle.

The high degree of uncertainty has also put off buyers. Not only are customers deterred by the current energy crisis, particularly in Europe, but the situation has become so very unpredictable that no one wants to enter contracts that involve shipments in 2023. Exporters are rather reckoning with short-term contracts this season.

Ferrero to issue new bid

Yet, prices are surprisingly fixed. Harvesting is nearly complete. Although some producers state that the proportion of rotten kernels is relatively high, others are quite satisfied with the quality of this year’s crop. Many nuts are, however, still laid out for drying and weather conditions are being carefully watched as rain may easily give rise to a high degree of mould and aflatoxin. Anticipations that Ferrero may issue a bid over TRY 92-94/kg for raw kernels this week have recently lifted market prices to TRY 89-90/kg. Buyers in Europe are confronted with stubbornly firm export prices, which should, however, change with more and more volumes of the new crop arriving in the market.

Hazelnuts, Turkey, 2022 crop




Natural, 11-13 mm



Diced, 2-4 mm



Meal, 0-2 mm



Paste, premium



DAP Central Europe


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