Turkish Hazelnuts, Market Update 03.04.2023
The Turkish hazelnut market was inactive last week due to bad weather conditions. There has been snowy weather in certain regions at high-altitude orchards, which are over 600 meters. We received several reports from different growing areas, and most agree that there has not been any significant damage. While there may be some local damages, they are not making any considerable impact. Moreover, this very wet week will suit the orchard's water needs.
Suppliers must also follow the Turkish Lira rate against USD and EUR. Turkey has an upcoming election on the 14th of May. After the elections, whoever gets elected, the current economic program will have to end as it cannot be sustainable anymore.
The trade deficit has been growing for the last three months, and the current government has been trying to close it with more pressing money and selling lots of foreign currency to the market to hold the USD or EUR. For February 2023, for the first time in years, the trade deficit has gone beyond critical limits. The graph below shows total TRL emissions since 2006, and it can be seen that since 2020, it has been increasing significantly and boosted since 2022. The Turkish central bank's monthly decrease in foreign currency reserves is much more than usual. Moreover, the government has made many populist decisions before the elections that will also negatively affect the economy in the long run.
Suppliers are expecting a rise in the currency in the coming months, but that does not mean that sellers will be looking to sell their goods at the same levels on a Turkish Lira basis. There could still be some better levels, but they may not align with the currency increase in the market.