Fearing rising prices and the perceived threat of sunflower oil shortages, customers have scrambled in
recent days to stock up on cooking oils. The Turkish government has reassured the public that a shortage
doesn’t exist. At the same time, in order to stabilize local market conditions, the government recently
halted cooking oil exports and also zeroed out tariffs on imported oils. Meanwhile, the purchase price of
imported wheat continues its upward climb, and some local feed companies are reportedly considering
limiting sales volumes if feed ingredient supplies become tight.
Government Reassures Public That There’s No Sunflower Oil Shortage…
Fearing rising prices and the perceived threat of sunflower oil shortages, customers have scrambled in recent days to stock up on cooking oils. The price of a 5-liter bottle of cooking oil climbed to TRY200 ($14), up by about 50 percent in the last week. This increase coincides with rising international prices of sunflower oil.
On March 6, the Minister of Agriculture & Forestry (MinAF), who was appointed earlier this month, issued a public statement reassuring the public that Turkey has adequate supplies of sunflower oil as well as other basic foods. To ensure stable domestic supplies of cooking oil, the Ministry has zeroed out tariffs on imported oils. The Minister of Finance separately reaffirmed that Turkey has enough cooking oil on hand to last until July. In contrast, some private sector representatives think stocks will run out sooner.
On March 4, the government announced that it was cutting import tariffs on vegetable oil to zero
until the end of June this year. Turkey depends heavily on its Black Sea neighbors for sunflower oil and sunflowerseed to make oil. The tariff cuts, which were promulgated in the Official Gazette, cover imported sunflower, soybean, palm, maize, and several other vegetable oils.
In addition, on March 4, the government added sunflower oil and several other staple foods to the list of export products that the Ministry of Agriculture & Forestry may restrict to stabilize local market conditions. To date and to the best of Post’s knowledge, Turkey has halted cooking oil exports, such as sunflower, corn, soybean oils, as well as bulk olive oil shipments. The situation may change by the day, with other products being restricted. Post will publish a separate report with the latest list.
According to local media reports from March 8, Russia authorized 30 commercial vessels loaded
with Russian sunflower oil and wheat to be shipped to Turkey. These shipments had reportedly
been stuck at loading ports in the Azov Sea due to the war. If these cargoes are delivered, they
may help to temporarily ease some of the upward price pressure on both sunflower oil and wheat
in the local market.
Imported Wheat Prices Jump Higher…
The developments in the region have disrupted wheat imports, with some Black Sea suppliers canceling contracts on the grounds of force majeure. These disruptions have caused the purchase price of imported milling wheat to climb by about 20-28 percent since January. According to market sources, on March 2, the Turkish Grain Board (TMO) purchased 285,000 MT of milling wheat for $409-449/MT, which is $65-98/MT higher than its last purchase in January. TMO purchased wheat is used to make subsidized bread that is sold in lower-income neighborhoods across Turkey.
Feed Manufacturers May Limit Sales…
Last week, a couple of the leading compound feed manufacturers in Turkey announced that they may need to limit sales volumes in the short term because of the disruption in imported ingredients coming from Black Sea countries. Some of the major imported ingredients include corn, barley, wheat bran and oilcake from Russia and Ukraine.