Highlights

Wheat production is forecast at 19.5 million metric tons (MMT) in marketing year (MY) 2017/18 because of high yields, especially in the Southeast and Thrace regions. Barley production is forecast at 6.5 MMT and corn at 5.5 MMT. However, there are quality problems everywhere. The Government of Turkey (GOT) eliminated tariffs on some grains. The Ministry of Food, Agriculture, and Livestock (MinFAL) announced 2017 wheat procurement prices on July 12, 2017, with intervention prices for Anatolian Hard Red Milling (AKS) wheat at 940TL/MT ($261/MT), and 1000 TL/MT ($278/MT) for durum wheat.

PRODUCTION

Wheat

Total wheat production is forecast at 19.5 MMT in MY2017/18 because of high yields, especially in the Southeast and Thrace regions. Harvest time is between mid-May and late-July in Turkey, and is around two weeks later than normal in almost all regions. About 50 percent of the wheat harvest was completed as of mid-July. Yields and quality are changing by regions and by fields due to irrigation and precipitation differences. Although Central Anatolia was affected winter drought last year, winter crops benefited from well-distributed rains in the spring, which compensated for the dry winter conditions. Wheat yield expectations remain favorable at the national level.

Despite serious drought after sowing during November and December 2016, rainfall in June 2017 was higher than the previous year throughout the whole country. Average rainfall in Turkey in June 2017 was 35 mm. This amount of rainfall is about 13.6 percent more than the long term average for that region, and 3.9 percent more than last year. Average rainfall in Thrace region in June 2017 was 51 mm. This amount of rainfall is about 48 percent more than the long term average for that region, and 54 percent more than last year. Rainfall in May was also helpful for the eastern part of Turkey, where harvest time is about one month earlier than western Turkey. For instance, average rainfall in the Southeast region in May 2017 was 56 mm. This amount of rainfall is about 46.6 percent more than the long term average for that region, and 129.5 percent more than last year. There was a significant recovery in that crop due to favorable weather conditions.

Almost 90 percent of the harvest was completed in the Southeast region by mid-July. Well-distributed rains in the spring resulted in high yields beyond farmers’ expectations. However, some farmers suffered from sunn pest damage in Gaziantep. Milling wheat area increased against durum wheat area in Southeast Anatolia, such as Mardin, due to high demand from flour millers. The first harvest in the Cukurova region and the Mediterranean coast started in the last week of May 2017. Average wheat yields were incredibly high at 7 MT/ha. In a normal season, the average yield is 5 MT/ha.

Central Anatolia regions, including Konya, Kirsehir, Polatli, were affected by winter drought. Although the crop in some regions in Konya and the western part of Kirikkale managed to recover, low yields were general traits of the 2017 wheat harvest, like last year. The protein content exceeds expectations in Polatlı area, but late rains in Thrace are reported to have lowered protein values. The first harvests in the Thrace region started in July 2017. Favorable weather conditions had contributed to wheat yields in Thrace. Yields in the region increased to 5-7 MT/ha, compared to 3-5 MT/ha in MY2016/17. The quality of the crop also deteriorated in the Aegean region due to heavy rain in June. Total wheat production is forecast at 19.5 MMT in MY2017/18, of which about 2.3 MMT is durum wheat.

Barley

Barley production is forecast at 6.5 MMT in MY2017/18 due to sufficient rain and favorable weather conditions during the spring, except in Central Anatolia. Late rains in spring were not enough to eliminate winter drought effects in a few areas in Central Anatolia. Some barley fields were irrigated in Southeast region. High yields and low quality were general traits of the MY2017/18 barley harvest.

Corn

Corn production is forecast at 5.5 MMT in MY2017/18. High returns for cotton and oilseeds, as well as a new support payment system, which does not encourage corn planting in drought prone regions, affected planting decision. Some farmers in Harran, Southeast region switched from milling wheat as first crop and corn for second crop back to cotton.

Rice

Post forecasts paddy rice production at 776,000 MT in MY2017/18. Rice planting finished in May 2017. Although planting area is similar with last year, some farmers are hopeful about yields due to new seed varieties.

Lentil

Despite increased GOT support, the area for lentil production has been decreasing for a couple of years. The main reason for this decrease is the switch from lentil to cotton and corn due to the availability of irrigation from the GAP project. The main areas of lentil production are in Southeastern Anatolian Region of Turkey as Sanliurfa, Gaziantep, Mardin, Batman, and Diyarbakir.

Lentil harvest completed at the end of June 2017. Total lentil production is forecasted at 380,000 MT, up 15 percent compared to last year due to favorable weather conditions. In some regions in Sanliurfa yields reached 2 MT/ha, but generally the yield was around 1.4 MT/ha.

TRADE

Turkey has imported a total of 4.4 MMT of wheat in MY 2016/17, of which the great majority (2.3 MMT) was supplied by Russia. Lithuania (494,000 MT) and Mexico (342,000 MT) were the other main sources. Due to short term trade restrictions on Russian commodities during April and May, Turkey tried to compensate Russian wheat with EU sources. Turkey imported about 630,000 MT of durum wheat in MY 2016/17. Mexico and Canada were the main suppliers with 324,000 MT and 145,000 MT, respectively. 200,000 MT of wheat were transferred to neighboring countries in MY 2016/17.

For MY 2017/18, wheat import into Turkey is forecast at 6.2 MMT as abundant domestic supplies are expected.

TURKEY: WHEAT FOREIGN TRADE

In scope of measures against food inflation, the Turkish government reduced the import tariff on wheat, barley and corn from 130 percent to 45, 35, and 25 percent respectively. Reference price for these commodities also was determined as $200 per ton. The GOT aims to pressure domestic commodity price with import instruments. Domestic prices are still lower than import cost despite the tariff elimination. After amendments on tariff rates, total cost for barley and corn are calculated at 860 TL/Ton ($239/MT) and milling wheat is at 1,080 TL/Ton ($300/MT) which are not attractive for importers in this stage. However, according to market sources, traders will import at least 100,000 MT of barley with a competitive price until August 1, 2017 before the reference price system comes into force. For MY2017/18, barley import into Turkey is forecast at 200,000 MT.

In June 2017, the Anatolian Hard Red Wheat (AKS) was about 930 TL/ton, barley was 855 TL/MT and corn was 880 TL/MT in the domestic market. Last year, the local prices were 875 TL/MT, 724 TL/MT, and 774 TL/MT, respectively.

The Ministry of Food, Agriculture, and Livestock (MinFAL) announced 2017 wheat procurement prices on July 12, 2017, with intervention prices for Anatolian Hard Red Milling (AKS) Wheat at 940TL/MT ($261/MT), and 1000 TL/MT ($278/MT) for durum wheat. Farmers can get up to 5 percent more according to quality (bugs ratio and protein). MinFAL also pays premium of 50 TL/MT and provides supports. Premium and supports for fertilizer, gasoline, certified seed and soil analysis reach 127 TL per ton.

The Turkish Grain Board (TMO) was very active in corn markets in MY2017/18. Low corn stocks in the private sector and steady demand from feed and starch producers encouraged TMO to import corn in order to meet the corn demand and stop price increases. A Cabinet of Ministers Decision published in the Official Gazette on May 11, 2017 authorizes the Turkish Grain Board (TMO) to import up to 500,000 of corn at a zero customs duty valid until December 31, 2017. TMO bought about 300,000 MT of corn in tenders during April and May 2017.

Corn imports for the first nine months of MY 2016/17 reached about 600,000 MT. Serbia is the main supplier with 156,000 MT, followed by Romania with 132,000 MT. Turkey also exported about 85,000 MT of corn during the same period.

Rice imports during the first nine months of MY 2016/17 were about 250,000 MT. Rice import into Turkey will be 300,000 tons, milled equivalent. Turkey imported 146,000 Mt of paddy rice (102,000 MT milled equivalent) from United States during the first nine months of MY 2016/17. When comparing importer and exporter data regarding Turkish rice trade, there are some differences due to transshipments. Also, another reason is that Turkish importers store the rice in bonded warehouses for 2-3 months until they find buyers to avoid advance payment of the 45 percent tariffs and VAT.

Rice exports during the first nine months of MY 2016/17 were about 50,000 MT. Libya is the main destination with 18,300 MT, followed by Sudan with 7,300 MT. Rice export forecast at 75,000 MT in MY2016/17, milled equivalent due to strong demand from neighboring and African counties.

Production, Supply and Distribution

Wheat

Wheat

2015/2016

2016/2017

2017/2018

Market Begin Year

Jun 2015

Jun 2016

Jun 2017

Turkey

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

7860

7860

7815

7815

7800

7800

Beginning Stocks

2767

2767

3118

3118

1293

1293

Production

19500

19500

17250

17250

19500

19500

MY Imports

4382

4382

4500

4500

5400

5400

TY Imports

4405

4405

4500

4500

5400

5400

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

26649

26649

24868

24868

26193

26193

MY Exports

5531

5531

6175

6175

6200

6200

TY Exports

5605

5605

6200

6200

6200

6200

Feed and Residual

1200

1200

700

700

700

1000

FSI Consumption

16800

16800

16700

16700

16700

16700

Total Consumption

18000

18000

17400

17400

17400

17700

Ending Stocks

3118

3118

1293

1293

2593

2293

Total Distribution

26649

26649

24868

24868

26193

26193

Yield

2.4809

2.4809

2.2073

2.2073

2.5

2.5

Barley

Barley

2015/2016

2016/2017

2017/2018

Market Begin Year

Jun 2015

Jun 2016

Jun 2017

Turkey

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

3400

3400

3400

3400

3400

3400

Beginning Stocks

332

332

961

961

361

361

Production

7400

7400

4750

4750

7000

6500

MY Imports

129

129

270

270

50

200

TY Imports

146

146

250

250

50

200

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

7861

7861

5981

5981

7411

7061

MY Exports

0

0

20

20

150

20

TY Exports

0

0

20

20

150

20

Feed and Residual

6000

6000

4700

4700

5500

5500

FSI Consumption

900

900

900

900

900

900

Total Consumption

6900

6900

5600

5600

6400

6400

Ending Stocks

961

961

361

361

861

641

Total Distribution

7861

7861

5981

5981

7411

7061

Yield

2.1765

2.1765

1.3971

1.3971

2.0588

1.9118

Corn

Corn

Sep 2015

Sep 2016

Sep 2017

Turkey

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

620

620

570

570

550

550

Beginning Stocks

712

712

862

862

532

512

Production

6200

6200

5500

5500

5500

5500

MY Imports

567

567

1000

1000

1500

1500

TY Imports

567

567

1000

1000

1500

1500

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

7479

7479

7362

7362

7532

7512

MY Exports

67

67

80

100

50

50

TY Exports

51

51

80

100

50

50

Feed and Residual

5500

5500

5700

5700

5900

5900

FSI Consumption

1050

1050

1050

1050

1070

1070

Total Consumption

6550

6550

6750

6750

6970

6970

Ending Stocks

862

862

532

512

512

492

Total Distribution

7479

7479

7362

7362

7532

7512

Yield

10

10

9.6491

9.6491

10

10

Rice

Rice, Milled

2015/2016

2016/2017

2017/2018

Market Begin Year

Sep 2015

Sep 2016

Sep 2017

Area Harvested

98

98

98

98

99

99

Beginning Stocks

217

217

128

128

98

73

Milled Production

500

500

500

500

520

520

Rough Production

746

746

746

746

776

776

Milling Rate (.9999)

6700

6700

6700

6700

6700

6700

MY Imports

250

250

300

300

320

320

TY Imports

275

275

300

300

320

320

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

967

967

928

928

938

913

MY Exports

49

49

50

75

50

50

TY Exports

55

55

50

75

50

50

Consumption and Residual

790

790

780

780

800

790

Ending Stocks

128

128

98

73

88

73

Total Distribution

967

967

928

928

938

913

Yield (Rough)

2.4809

2.4809

2.2073

2.2073

2.5

2.5