Barley Pushes Corn Imports in Turkey
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In MY 2022/23, Turkish Corn production is forecast at 6.0 MMT, assuming a reduced area harvested as farmers switch to more profitable row crops, such as cotton. Yields are expected to decrease slightly as planting in Cukurova, one of the main growing areas, was delayed because of heavy rainfall. The Corn production estimate for MY 2021/22 was 6.5 MMT.
The primary Corn-growing regions are Central Anatolia, Southeast Anatolia, Cukurova, and the Aegean. Except for Southeastern Anatolia, moisture levels in these regions are better than the preceding year, which was marked by drought. Planting was delayed in Cukurova by more than a month because of heavy rainfall. Some farmers in Central Anatolia were considering whether to plant Corn or sugar beets, based on expected profitability. Some farmers in Southeast Anatolia have switched from double cropping Corn and wheat to growing cotton.
Farmers are facing skyrocketing input costs, including fertilizer and fuel. Costs increased because of a weaker Turkish Lira (TL), rising international commodity prices, and supply chain issues. For example, diesel prices have more than tripled since October last year, rising from 7 TL/liter ($0.82 /LT) to 22 TL/liter ($1.5 /LT). In response to higher input costs, the Government raised the support payments to Corn farmers for fertilizer and diesel to 80 TL/HA and 250 TL/HA, respectively.
In contrast to wheat and barley farmers, Corn growers can more easily handle these higher input costs since they can raise prices and, thereby, pass along higher input costs to end-users. However, there is concern that Corn farmers may reduce fertilizer use to save on cost, which could impact yields and overall production amounts.
MY 2022/23 consumption is forecast at 8.8 MMT, up 200,000 MT from the previous year, based on increased demand from the feed and starch sector. The MY 2021/22 consumption estimate was lowered 800,000 MT to 8.6 MMT due to a contraction in feed demand and feed millers substituting imported barley for Corn.
Corn is primarily used in manufacturing feed and, to a lesser extent, producing Corn starch for food use. With nearly 85 percent of Corn used to make animal feed, overall consumption typically parallels trends in the feed sector. At the same time, feed Corn consumption is influenced by the prices of alternative feed ingredients.
The Government regulates Corn starch-based sugar production through production quotas; beet sugar production is likewise regulated through quotas. The Government announces annual production quotas, which are expected to decrease in size this year. Starch producers use about 900,000 MT of domestic Corn each year. The industry’s annual production capacity is 1.5 MMT.
Turkish Corn Price and Import
The average price of domestic Corn continues to climb higher. In March, the price was about 4,650 TL/MT (~$320/MT), up more than 30 percent from a year ago. This increase is in response to rising input costs farmers are having to pay and parallels rising international Corn prices. By comparison, TMO sells imported Corn at about two-thirds the price of 3,000 TL/MT ($207/MT). In March, TMO raised its Corn selling price by about 12 percent to its current level.
MY 2022/23 Corn imports are forecast to increase year-over-year by 600,000 MT to 2.8 MMT. The projected increase is due to lower Corn production levels and assumes stable feed demand. To stabilize prices, the Government has zeroed import duties on Corn and other grains (except rice) in the calendar year 2022.
The MY 2021/22 Corn import forecast was lowered by 600,000 MT to 2.2 MMT. This downward revision is mainly due to stronger than expected barley imports. As per AgFlow data, Ukraine (2.0 MMT) was the largest import market of Turkey’s Corn in 2021-22, followed by Russia (0.9 MMT) and Romania (0.4 MMT).
Other sources – Turkish Corn: https://www.usda.gov
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