Report Highlights: 

Turkish sultana raisin production is expected to increase by 35 percent in MY2014/15 to 328,167 MT, thereby rebounding from last year’s poor crop. Sultana raisin exports are forecast at 280,000 MT in MY 2014/15, up from 215,000 MT last year.

Executive Summary: 

According to the Raisin Production Forecast Commission, sultana raisin production in the Aegean region which accounts for virtually all production, will be 328,167 MT from a harvested area of 983,559 decares (243,042 acres). The Raisin Production Forecast Commission has members from Izmir Commodity Exchange, Izmir Chamber of Commerce, Manisa Commodity Exchange, Alasehir Commodity Exchange, Aegean Exporters Union and the Ministry of Food, Agriculture, and Livestock (MinFAL) Grape Research Center. 

After a bad season of freeze and hail in MY 2013/14 that resulted in a 20-percent in production, Turkish sultana raisin production is forecast to increase to a record high level of 328,167 MT in MY 2014/15. Favorable weather conditions and increased area are the reasons for the expected increase. Among European countries, the UK is the leading export destination, receiving 28 percent of all Turkish raisin exports with 42,000 tons between September 2013 and June 14, 2014. UK is followed by Germany, Holland, Italy and Australia. This trend is expected to continue similarly in the upcoming years. 

Production: 

Turkey is the world’s second largest raisin producer after the United States and the leading exporter, accounting to 25 percent of the world’s total raisin production and 40-45 percent of total raisin exports. Grapes are grown throughout Turkey, and there are over 1,200 different grape varieties in Turkey. Nearly two-thirds of these grapes have seeds, and one-third are seedless. 

Turkey produces approximately 4.2 MMT of grapes annually. Table grapes make up approximately 30 percent of the production, drying grapes make up 35 percent, grapes for traditional products such as pekmez (molasses) make up 25 percent, and grapes used for alcoholic beverage production make up approximately 10 percent of this total. 

Harvest season starts around August 15, so the marketing years in this report refer to the period between September 1st of the first year until August 30th of the next year. Seedless grape production expanded significantly in Turkey in the 1990s due to more intensive cultivation and adaption of better irrigation techniques. Seedless grapes constitute about 40 percent of Turkey’s total grape crop and are grown only in the Aegean (western) part of Turkey. While the Aegean region produces seedless grapes, the Marmara, Central Anatolia and Southeast Anatolia regions produce table and wine grapes. Sultanas are indigenous to the Aegean Region and are the raisin variety referred to in this report. 

The Sultana Raisins Association, which was established in 1934, formed the basis of “TARIS Raisins Agricultural Sales Cooperatives Union”. Generally, TARIS purchases around 15-20 percent of total production. The cooperatives of the union are spread across the Aegean Region, located in the western part of Turkey. The vineyards of TARIS members have always set a very good example in the region regarding the yield and the quality of the product. 

The size of an average farm land is less than 3 hectares in Turkey. Therefore, as like other commodities, seedless grapes are generally grown on small farms averaging about 1.3 hectares. It is estimated that nearly 65,000 growers produce seedless grapes in Turkey, and about half of all raisin producers are members of TARIS. Each year TARIS announces a procurement price for raisins, which also serves as a support price. TARIS is required to buy raisins from its members but members are free to sell to other buyers and they often do. 

Consumption: 

There are numerous firms in the dried fruit processing and export business in Turkey; however, the top ten firms are estimated to control about 80 percent of the raisin market. 

TARIS’s role in procuring and marketing raisins has been decreasing in conjunction with IMF-backed reforms to reduce the government’s role in agriculture. In general, TARIS has been the buyer of last resort, purchasing a large percentage of lower quality raisins. The quantity of raisins TARIS procured has varied from as low as 9,000 MT to as high as 75,000 MT during the last ten years due to variable production levels and quality. In MY 2013/14 TARIS bought 16,300 MT of the crop, which account to 6.7 percent of total production. 

TARIS and the Izmir Commodity Exchange are the two price determinants in the market. The former announces the advance procurement prices in the beginning of the season and the latter is the main cash market for raisins. 

Despite’s Turkey’s leading role in the production of raisins, domestic consumption is comparatively low, and most of the production (generally around 90 percent) is exported. Human and industry consumption is around 20-25,000 MT and the alcoholic beverages sector (lead by raki - a strong anise based Turkish alcoholic drink, and followed by wine and brandy) use about the same amount. Alcoholic beverage industry has been under the pressure of the conservative government actions such as restricting sales and marketing activities, heavy taxation, etc. which eventually reflected in a decrease of consumption. The Raki industry usually demands 350,000 MT of grapes, and the brandy and wine industries demand about 80,000 MT of grapes annually, and the wine grape production barely meets this demand. 

Domestic consumption of sultanas is forecast at 45,000 MT for 2014/15. 

Trade: 

EU countries continue to be the top export destinations for Turkish raisins, and are predicted to be so in MY 2014/15 as well. The European Union accounts for 84 percent of Turkey’s raisin exports. In MY 2013/14 sultana raisin exports decreased as much as 10 percent to 215,000 MT due to the decrease in production, but exports should rebound to 280,000 tons in MY 2014/15. United Kingdom, Germany and Holland continue to be the top three importers of Turkish raisins. Due to the increase in yields in MY 2014/15, post expects an increase in the amount of exports and a decrease in prices. Currently the price of raisins is expected to be around 3 TL/kg by the Izmir Commodity Exchange in the upcoming marketing year which means the export price would be around 5 TL/kg. (1 US$ = 2.15 TL as of the date of this report August 2014)