Unexpectedly dry weather conditions in Turkey between April and June in many regions led to lower
wheat and barley production forecasts for MY 2021/22. The wheat production forecast is 16.5 MMT,
barley production forecast is 4.5 MMT. Planting for the first corn crop finished and production is
forecast at 6.8 MMT. The Turkish Grain Board (TMO) opened tenders for about 1.5 MMT of wheat and
barley in June and July.

Total wheat production forecast has decreased to 16.5 million metric tons (MMT) for marketing year (MY) 2021/22 from an original forecast of 17.6 MMT in April. This change is due to unexpectedly dry weather conditions between April and June, causing yield and quality losses, especially in the Southeast and Central Anatolia regions. The expected increase in production in the Thrace region is not sufficient to compensate for losses in other regions.

Marketing year 2021/22 wheat planting is forecast to decrease to 7 million hectares (MHa), down
100,000 hectares (ha) compared to MY 2020/21. Farmers have complained about low domestic prices,
despite sharply increased input costs which affected crop selection.

For MY 2021/22, Turkey’s wheat import forecast is 11.25 MMT, a record high level, due to demand
from the domestic market, stable demand from wheat product manufacturers, and a smaller harvest than
expected. Total wheat exports from Turkey for MY 2021/22, including wheat products, are forecast at 6
MMT, down 300,000 MT from MY 2020/21, assuming more limited domestic production will partly
affect pasta, bulgur, and other wheat product exports. The domestic wheat industry is concerned about
possible export limitations during the year as a measure to combat domestic food inflation, as seen in
other countries in the region. More background on the sector is available in the Turkey Grain and Feed
Annual Report.

Turkey imported about 8.15 MMT of wheat in MY 2020/21. The main supplier was Russia, with 6.3 MMT of wheat exported to Turkey. Ukraine (740,000 MT) and Canada (250,000 MT) were the other main sources. The Turkish Grain Board (TMO)’s duty-free tenders to meet domestic demand and demand from wheat product producers are the main driving force of imports since commercial importers can’t compete with the high tariffs. There has been a slowdown in Turkish wheat products exports in
recent years. In MY 2020/21, wheat exports from Turkey (including flour and wheat products) are estimated to be 6.3 MMT (wheat equivalent basis), of which about 2.9 MMT is wheat flour, about 1.4 MMT is pasta, and about 250,000 MT is bulgur. Pasta exports, which have increased 25 percent in the last three years, compensated for the loss of flour exports.

The President of Turkey announced the 2021 grain intervention prices on May 17, 2021. He announced
the intervention price for Anatolian Hard Red Milling Wheat (AKS) at 2,250 TL/MT ($268/MT), 2,450
TL/MT ($291/MT) for durum wheat, and 1,750 TL/MT ($208/MT) for barley (exchange rate of
US$1=8.4 TL as of May 17, 2021). On behalf of the government, TMO is responsible for buying grains
from the farmers to ensure a minimum price threshold. However, this year TMO’s total procurement
will likely be limited due to higher domestic price in the markets which is above the TMO’s intervention

In July 2021, the Anatolian Hard Red Wheat (AKS) price is about 2500TL/MT barley is 2,400
TL/MT and corn is 400 TL/MT in the domestic market. Last year, the local prices were 1,650 TL/MT
($243/MT), 1,320 TL/MT ($194/MT), and 1,350 TL/MT ($199/MT), respectively (exchange rate of
US$1=6.8 TL as of July 2020). In other words, the main grain commodity prices increased between 50-
80 percent in TL in a year, although the currency depreciated against the dollar and euro.

There may be a tariff reduction for the main grains in the following months, as has been announced in previous years,
depending on the harvest. After the spring wheat harvest, TMO imported about 790,000 MT of wheat
with two issued tenders in June and July 2021 to meet the domestic demand and stabilize the domestic
wheat price.

Source: United States Department of Agriculture (USDA), GAIN Reports

About İsmail Uğural

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