Australia’s Hazelnut Push: Import Replacement Meets Firm Global Prices

Australia’s hazelnut sector is entering a strategic growth phase, aiming to lift production beyond 3,500 tonnes over the coming decade while global kernel prices remain firm and value-added products gain traction. For market participants, the focus is shifting from pure volume to integrating orchard expansion with processing capacity and higher-value channels. Australia remains a small player in global hazelnuts but is targeting domestic import replacement as its first major growth lever. The upcoming 2026 Australian Hazelnut Industry Spring Symposium in Orange, NSW, will center on how to scale orchards, improve yields and build processing for hazelnut oil, meal and other derivatives. At the same time, FOB kernel offers from Turkey and Georgia indicate a relatively steady, moderately supported world price environment, reinforcing the commercial logic for Australian growers to move up the value chain.

Prices

Recent offer indications for Turkish hazelnut kernels in EUR FOB suggest a firm but not spiking market. Conventional Turkish natural kernels (11–13mm) are currently around EUR 6.97/kg FOB Istanbul, with 13–15mm at about EUR 7.50/kg, both slightly lower than mid-August levels, pointing to mild easing after earlier strength. Organic Turkish kernels (11–13mm) are offered near EUR 19.33/kg FOB Izmir, with larger 13–15mm sizes around EUR 18.30/kg and blanched roasted organic kernels near EUR 22.85/kg, effectively flat over the past three weeks.

Georgian kernels delivered FCA Warsaw are at a premium to Turkish origin, with 13–15mm around EUR 10.10/kg and 15+mm roughly EUR 10.50/kg. This differential reflects product positioning and logistics rather than a sharp fundamental divergence. In Turkey’s domestic market, the state purchasing floor price for the 2026/27 crop has been raised to TRY 250/kg in-shell, underlining structural cost and support levels that are likely to underpin export price floors over the new season.

Supply & Demand

Australia is positioning hazelnuts as an import-replacement crop. Current domestic demand is largely met by imported kernels, historically around 3,400–3,500 tonnes annually, mainly from Turkey. The industry’s stated goal of exceeding 3,500 tonnes of local production over the next decade is therefore closely aligned with displacing these flows rather than immediately competing on large-scale exports.

Globally, Turkey remains the dominant supplier, with national crop and export policy continuing to set the tone for world prices. Recent moves by the Turkish Grain Board (TMO) to lift its 2026/27 in-shell floor price signal ongoing government support for growers and a desire to keep farm-gate returns in line with inflation and production costs. This backdrop suggests a structurally supported international price environment, even if short-term export volumes have softened on subdued confectionery and ingredient demand.

Fundamentals & Australian Industry Strategy

Australia’s current hazelnut industry is small but increasingly coordinated, with the AUSHAZ R&D program backing work on production systems, sustainability, marketing, and pest, disease and bird management. This research focus is designed to underpin commercial expansion by lifting yields, stabilising quality and reducing on-orchard risk as planted area grows. The 2026 Spring Symposium in Orange will be a focal point for sharing trial results, discussing new orchard developments and aligning growers and investors on best practice.

A key insight from the industry’s strategy is that future growth will not rely solely on raw kernel sales. Planned investment into processing – notably hazelnut oil, hazelnut meal and other by-products – aims to monetise a broader grade spectrum and diversify end markets. This mirrors global trends in the tree nut sector, where health-positioned oils, flours and snack ingredients capture price premia and reduce exposure to single-channel confectionery demand.

Australia’s trade data confirms it is a consistent net importer of hazelnut kernels, with imports only marginally fluctuating in recent years. This persistent deficit underpins the rationale for new plantings: domestic buyers in confectionery, bakery, health foods and specialty oil segments represent a ready-made demand base, while locally grown kernels generally attract a premium over imports for provenance and freshness.

Weather & Crop Conditions (Key Regions)

In Turkey’s Black Sea region, the 2026 harvest window has broadly opened, with official notices marking inspection periods in mid to late August. Localised reports indicate typical seasonal conditions, with no major, late-breaking weather shocks reported over the last few days that would materially change the global supply outlook. This supports the view that the current Turkish floor price, rather than weather stress, is the main driver of producer sentiment.

In Australia, hazelnuts are concentrated in cooler temperate regions such as northeast Victoria and parts of NSW. While short-term weather has been variable, the main sector focus is on longer-term climate resilience, including cultivar selection and orchard design that can handle episodic heat and frost. R&D on production systems and sustainability is central to managing these structural climatic risks rather than reacting to any single season.

Forecast & Trading Outlook

Over the next 6–12 months, the Australian hazelnut market is likely to remain structurally tight, with domestic consumption still heavily reliant on imports even as new orchards establish. The primary medium-term risk is execution: the industry must convert planting intentions into commercially viable yields while ensuring processing capacity for oil, meal and other value-added products keeps pace. Successful integration of orchards and processing could gradually narrow the import gap and stabilise local pricing.

Globally, the raised Turkish floor price and firm domestic Turkish spot indications suggest downside for kernel prices in EUR terms is limited unless demand weakens significantly. At the same time, modest easing in recent FOB offers for some sizes indicates buyers retain some negotiating power as new-crop supply comes to market. For now, the market appears balanced to mildly supported, with value-added segments (oils, flours, premium origins) best positioned to defend margins.

Focused trading recommendations

• Australian buyers: Secure a portion of 2026/27 needs via medium-term contracts with Turkish and Georgian suppliers while gradually onboarding Australian-origin supply as it scales; prioritise traceable, higher-quality kernels for premium products.
• Australian growers/investors: Align new plantings with access to processing (oil, meal, paste) rather than relying solely on bulk kernel export channels; leverage R&D outcomes on production systems and pest/bird management to lock in yield stability.
• Processors/brand owners: Develop and test hazelnut oil and meal SKUs now to be ready for larger volumes of Australian origin in coming years; emphasise provenance and sustainability claims to justify price premia versus imported kernels.

3-day price indication & directional outlook

• Turkish conventional kernels, FOB Istanbul: Around EUR 7.0–7.6/kg; bias slightly stable to firm as the new-crop floor price underpins grower offers.
• Turkish organic kernels, FOB Izmir: Around EUR 18–23/kg depending on size and processing; expected to remain broadly stable over the next few days amid limited immediate supply shocks.
• Georgian kernels, FCA Warsaw: Roughly EUR 9–11/kg; likely to track Turkish price direction with a stable quality and freight premium.