This week, the Turkish hazelnut market appeared much more relaxed again. The first inspection of the hazelnut orchards in the eastern Black Sea region showed that the cold front did not cause any serious damage. Only at altitudes of 500 m and above, and in some cases as late as 700 m, there was local damage, but this was in the range of 5-10%. As a result, raw material prices dropped again and, at 57 TRY/kg for hazelnut kernels in shell, are back at the level before the cold front. However, it is still too early for a general all-clear, as many damage reports from the western growing regions have not yet been verified. If these were serious, however, the word should have spread by now.
Hazelnut Crop 2023 Expected in a Normal Range
Overall, frost is hardly an issue for Turkish exporters. Rather, the size of the coming harvest is being discussed in the Turkish hazelnut market. It is still too early to make an estimate, but the frost has led to a close inspection of the gardens, and the teams have independently noticed that the coming harvest will probably “only” be in the normal range at most. As I said, the official count will not take place until May, but there is a sense of subdued optimism. Should this suspicion be confirmed, it is quite possible that the market leader will become active again and could thus stimulate demand. The question is whether this will be done on its own or covertly via other exporters, which we tend to assume.
Buyers are out for the Holidays
In terms of demand, there was little to report in the export business this week, as expected. Many buyers are away on holiday and the easing in the market gives no reason for action. In the Turkish domestic market, on the other hand, demand continues to be good. The export figures also continue to show satisfactory values in terms of volume. Also, the averages are so slow indicating that the time for loading the cheap contracts is running out. Although the price lists continue to be quite inhomogeneous, we see that especially for the preparations the price expectations could not be realised and that the exporters are now correcting further downwards here. For natural kernels, the situation is more differentiated, depending on the quality.
Weather Forecast Gives no Reason for Concern
The weather forecast for the coming week gives no reason for concern. By next week, the weather situation should be predictable enough to rule out the risk of frost. We suspect that even then the focus will increasingly shift to the 2023 harvest.
Concerning the exchange rate development, we see the trend of the last few weeks continuing. The Turkish lira is increasingly weakening, which has a positive effect on the price level for export for buyers. The Central Bank’s Monetary Policy Committee will meet again at the end of April before the long-awaited election in May. No more serious interest rate hikes or other measures will likely be taken shortly before the election.
For the coming week, we expect little trading activity in the Turkish hazelnut market due to the holidays.
bullet points
- The cold front only caused minor local damage in the eastern growing regions. Results from the western growing regions are still pending.
- Turkish hazelnut market eases again after the above-mentioned all-clear. Raw material prices fall back to the level before the cold front.
- However, sightings of the hazelnut orchards lead to subdued optimism about volume expectations for the coming harvest.
- The strong euro and the weak Turkish lira also cause a price correction in the export price lists.
- Due to public holidays, export demand remains subdued.
Import/Export Statistics
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