June 20, 2012

 

Turkey announces high grain price

 

 

The Turkish government's intervention price for the wheat market has hiked from TRY605/tonne (US$336.3) last year to TRY655/tonne (US$364.09), according to Agriculture Minister Mehmet Mehdi Eker.

 

Wheat production this year is estimated to reach 19.5 million tonnes, some 2.3 tonnes lower than last year, while the forecast for barley production stands at 6.5 million tonnes, Eker said at an Ankara meeting on the issue.

 

Turkey distributed 18.7 million tonnes of last year's wheat on the domestic market, stocking the remaining 3.1 million tonnes.

 

For several reasons, such as low rainfall in April and the cold weather, production in Central Anatolia was particularly poor. "Accordingly, the total grain production is estimated at 19.5 million tonnes," Eker said.

 

Turkey was the world's top flour exporter last year, and the second largest pasta exporter after Italy, he also said. Exports of processed wheat products made up US$1.9 billion, he said.

 

The harvest also began late this year and about 15% has been completed.

 

The Turkish Grain Board's (TMO) benchmark price is for red Anatolian bread, which contains between 11.5% and 12% protein, Eker noted, adding that the figure went higher when a sum of TRY115 (US$63.92) of support was included.

 

The usage of productive seeds increased by 36% this year, which is reflected in a higher quality, he added.

 

Turkey used to import high quality flour for bread to mix it with 90% of low quality domestic flour until 2005. "Today some Middle Eastern producers suggest selling us low quality flour so that we can mix it with domestic products and sell to third parties," he added.

 

This year farmers will get payments within 10 days, which is a first, according to Faruk Çöklü, a high ranking official at the Konya Chamber of Agriculture. Konya, a Central Anatolian province, is one of the leading grain growing regions in Turkey.

 

"Now farmers have a guarantee. They will be able to sell their goods at real prices," he told Anatolia news agency. The TMO used to start delivering payments in one month. The rise in official prices is above the inflation rate, as the hike in energy prices is affecting grain producers, he also said.

 

Lütfi Topbaş, head of the Karatay Chamber of Agriculture, said he was unhappy with the 2012 prices, adding that low quality grain would be bought by the TMO for lower prices.

 

"Despite recent efforts to raise the quality, weather conditions and other reasons have prevented the attainment of quality standards. Thus, nearly 80% of our grain will be bought for low prices, less than TRY655 (US$364.09) per tonne. Considering the price hikes in fuels and fertilisers, this price is low," TopbaÅŸ said.