Report from Ozgur Tarim:
According to the data from Aegean Exporters union, Turkey exported 255.043 tons between 01.09.2014 to 29.08.2015. The average price of this total quantity was $1800/MT
Looking at this figure, we believe crop size of 2014 crop was lower than the declared volume 328.000 tons and it was 305 thousand tons.
We believe there was also a carry in of around 35 thousand tons which made the total supply 340 thousand tons.
|Carry In From 2013 crop||35000|
|Total Available Quantity||340000|
|Export end of the season||255000|
|Domestic Consumption (ıncluding alcohol)||40000|
|Carry Over to 2015 crop||45000|
|Carry In From 2013 crop||45000|
|Total Available Quantity||215000|
|Domestic Consumption (ıncluding alcohol)||35000|
|Export end of the season||180000|
|Carry Over to 2015 crop||0|
Season started, raw material is coming slowly. As was expected, it is a lot slower than 2014 crop. New seasons shipments will start from this week. Last year in these days in 2 buying stations we were receiving 1500-1600 MT but in this year we aren’t able to receive more then 250-300 tons.
Aproximately half sold and other half in consignment.
If we divide the region into 4 parts, we will better explain the situation region by region.
- Manisa to Akhisar
- Manisa to Salihli
- Salihli to Alaşehir
- Alaşehir to Denizli
Region 4 has the most problem. This area is producing fresh grapes for vineries and for Raki industry. The extreme cold weather in winter time (below –12 C) has damaged these vineyards most seriously. So many vineyards here are dead from cold, needs to be pulled out. We will see if they will replace with vineyards on the coming years. Alcohol industry here was buying more then 250.000 tons of Fresh grapes but they will be able to buy a maximum of 20-30 thousand tons. They are also shifting their demand to other regions, mainly to Region 3.
Region 1 and Region 2 also has serious problems from the several frosts happened through March and April. In these regions there are more then 10 exporters ıf Sultanas and Raisins and mainly the big ones.
Region 3 – Here has the least damage but even in this region according to most optimistic view the shortage is over %40. After a crop of 2014, the yield of the vineyards wasn’t too good.
Our main market on fresh grapes is Russia, due to the crisis there exports are slower, but considering the at least %40 shortage of crop here, the shortage of export doesn’t seem to be as big.
On the other hand the domestic demand for fresh grapes is really big. Availability of other fruits is even more scarce and more expensive.
Region 3 is also receiving a lot of demand from other regions and has its own demand also. Here most of the goods normally traded through mid traders (merchants). Big demand to them.
We hear that, there are even some exporters from other regions here, buying fresh and carrying the goods to their regions for drying.
All in all, crop is very short. Prices in Lira terms increased already too high. Tariş already announced their opening prices. They are a lot earlier then they usually are. Because they weren’t having enough and needed to declare some good price to attract growers. Because if anyone misses the season to purchase after the harvest this year will have difficulty later on. Thankfully yet the currency is helping the USD offered prices from increasing too much. From another perspective this devaluation is also helping Lira prices of raw material to increase more.
Importers are mostly quiet, they try to collect previously made (mostly very low priced) contracts as fast as possible. Until these are finished they prefer to watch and see the developments in the market. Most comparing this season to 2013 crop, while prices increased too much at the beginning and then decreased too much. They are afraid the same may happen this year again. But please remember that time prices reached upto 2900 usd / ton in Turkey but that time California had a really big crop and a carry over. They used this opportunity too good to get rid of their accumulated stocks. But this year the situation is a lot more different. And yet, still they are more expensive then Turkey. Other than USA , there is no other origin to substitute
Of course Turkish prices shouldn’t increase too much. We always say that this is not a medicine 🙂 We believe it must be max 2500 usd / ton. But you never know there is no control over the market but due to the psychology of the players in the short term we may see a lot bigger fluctuations.
The levels today which are between 2300-2500 USD is not too high considering the past levels. But not that easy for the buyers to accept after lower then 1600 usd levels of last year.
We prefer to sell on a daily basis. What we buy we try to offer and sell. As always is the priority is with Chelmer Foods.
We will keep to follow the market very closely.
Please let us know if you have any comments or questions.