Hazelnuts: The hazelnut market is moving very slowly

Ankara – Not much is happening on the hazelnut market at the moment. There are still only isolated enquiries from Europe, but exporters continue to report good loading figures from existing contracts. It seems that uncertainty about further developments still prevails among the majority of buyers.

The market is still waiting for the TMO to announce at what price it will buy. However, hardly anyone expects a surprise here, so the Turkish domestic commodity market remains firm with a rising trend. Therefore, there continues to be some demand from exporters for commodities, who are buying at the current rate and storing the commodity speculatively. This also means that this level (plus financing costs, which are not insignificant) can be the basis for selling preparations even over the harvest transition. Thus, especially for the fourth quarter, we expect an extremely inhomogeneous market between the individual suppliers regarding preparations and pastes. We do not expect this to be the case with natural hazelnut kernels. Here we see the danger that the farmers will hold the old stocks and mix them with the new harvest to bring them to the crackers. The editors are still trying to find out which stocks are actually still being held by the farmers.

About the exchange rate, there is also little to report. After the Turkish lira gained against the euro last week, it lost almost all of this gain at the beginning of this week. Experts had actually expected the lira to strengthen, as the talks on Monday between Turkish President Erdogan and US President Biden were very positive for Turkey.

For the coming weeks, we expect trading to be quiet, similar to this week. The TMO will probably wait about 6 weeks before deciding, and the first regions will start harvesting in about 8 weeks. Some factories will close for cleaning and maintenance at the beginning of August, but many have already finished the current season. We also expect the market leader to signal to the market only after the TMO’s decision.

• The export market remains subdued. Market participants live on existing contracts.
• Customers are currently still shying away from long-term contracts. (Speculative) purchases by exporters are maintaining/driving the current price level of raw materials.
• The strength of the US dollar puts the Turkish lira under pressure again; it loses almost all of the previous week’s gains.
•  No surprises are expected for the coming weeks.

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