March 15, 2006

 

Turkey increases soybean and soymeal duties
 

 

The Turkish government increased on Mar 13 its soybean and soymeal import duties to 10 and 13.5 percent, from 0 and 8 percent respectively, the USDA reported through its Foreign Agricultural Services update. 

 

However, the new regulation keeps soymeal import duties for the EU countries and Bosnia at zero, with duty on soybean imports from Bosnia also remaining at zero. 

 

The decision, the USDA said, caught all related industries, including feed millers and poultry and oil producers, by surprise. 

 

The increase in duties will hit the Turkish poultry particularly hard, the agency predicts. "The sector is still trying to recover from a huge drop in sales due to avian influenza," the USDA said. "The higher production costs will only add to their troubles."

 

Practically all soymeal imported and produced locally is for the poultry sector.  Poultry production during CY2006 is expected to decline about 30 percent to 650,000 tonnes compared with 950,000 tonnes in CY2005 as a whole. As it is for the past six months, the poultry sector has been under increased financial strain. 

 

Feed industry representatives indicated that the recent tariff increases would raise total costs of production and make feed rations more expensive for the poultry industry, the USDA said.

 

The problems of bird flu and tariff increases will likely reduce total imports by about 25 percent during MY2005, sources said, adding that the zero customs duty for soymeal from the EU will give EU crushers an upper hand against US, Brazilian and Turkish crushers. It is also estimated that the Turkish government will gain some US$50 million in revenues from these new duties. 

 

Turkey imported a total of 1.1 million tonnes of soybeans during MY2004, nearly double that from MY2003's imports of 600,000 tonnes. Turkish soymeal imports also went up by about the same proportion during the same period, to 685,000 tonnes from 370,000 tonnes. 

 

About 48 percent of the soybean and soymeal imports in MY2004 were from the US, with the rest from South America; the total value of soybean and meal imports to Turkey was US$450 million in MY2004.

 

However, US soy exports have decreased primarily due to bird flu in Turkey and the drop in feed demand. South American meal will be particularly affected by the increase during the spring.

 

For the full USDA report, click here.