Turkey to suffer the shortage of importable supplies of Black Sea sunflower seed till new season – SUNSEEDMAN




Turkish oilseed market faced many challenges in 2020: pandemic of COVID-19, decline of production of main oilseeds in Black Sea region, currency rally and high prices of raw materials and by-products.

The independent expert SUNSEEDMAN, Veysel Kaya told us about the results of the difficult year, realities and prospects of Turkish oilseed market, key trade trends and challenges.


- How would you characterize the condition of oilseed processing industry in Turkey? How has COVID-19 pandemic affected the sunflower seeds deliveries and the processing industry in general?

- Firstly, let me inform you that Turkey has around 9 mln tonnes onnes of oilseed crushing/processing capacity and unfortunately half of it is not used due to the shortage of raw materials. Turkey raises only 3 mln tonnes onnes of oilseeds and the balance is dependent totally to the imports.

Particularly in sunflower seed, Turkey considerably suffers the lack of imported supplies.

Turkey raises around 1.5 mln tonnes of oil-bearing sunflower seed, but consumes 1.3 mln tonnes of sunflower oil locally, so this implies the need of 3 mln tonnes of sunflower seed, i.e. to make the local output double or to import.

However, all Black Sea countries are just willing to increase their crushing to make the added value and impose the bans and export taxes as well.

For example, by April 2020, Russia has banned sunflower seed exports to secure their local supplies as per COVID-19 pandemic.


- What difficulties have market participants faced in 2020 in Turkey because of global pandemic and difficult economic situation? What are the wins and losses?

- Indeed, HORECA sector was the most unfavorably affected one. Turkey welcomes more than 50 mln of tourists per year and also has so big local service sector. Of course, COVID-19 pandemic has reduced the demand.

Nevertheless, Turkey has significant local vegoils consumption of around 1.5 mln tonnes and demand was somehow kept and the factories were mostly active.

Besides, let me also underline that COVID-19 pandemic has deteriorated the economic conditions of Turkey by sailing the USD/TL parity to the records and lessen the income of the citizens.


- In 2020, Turkey has quite actively imported sunflower seeds and oil from Russia. At the same time, Russia has decided to increase export tax on sunflower seeds. How can this influence the deliveries of the oilseed to Turkey in near term?

- By Jan/Nov 2020, officially Turkey imported 928.5 thsd tonnes of oil-bearing sunflower seed. Particularly, Russia supplied 624.5 thsd tonnes of the oilseed, Bulgaria - 80 thsd tonnes, Moldova - 65.5 thsd tonnes, Romania - 54.5 thsd tonnes, Argentina - 31.5 thsd tonnes, Ukraine - 28.5 thsd tonnes, France - 21 thsd tonnes, Serbia - 16 thsd tonnes, Kazakhstan and Bosnia - 3.5 thsd tonens each.

As you may notice, Russia has around 2/3 share in total imports.

In 2020/21 season, Turkey raised 1.45 Mln tonnes ( vs 1.6 of 19/20) of oil-bearing Sunseed ( also 150 kmt of confectionary type) and imported/contracted only 355 kmt including 155 kmt of Russian origin.

After 9 January till 30 June 2021, Russia will be virtually off due to 30% export tax, but not less than 165 EUR/t. The exportable supplies in other origins are also limited, so my seasonal sunflower seed import size forecast is only 450 thsd tonnes vs 1040 thsd tonnes of 2019/20.

Accordingly, Turkish sunflower seed crushings will be reduced to 1925 thsd tonnes vs 2750 thsd tonnes of 2019/20. Instead, more sunflower oil imports to compensate the shortage local sunflower oil output.

Right now, crude sunflower import-duty was reduced to only 10%, but may be even 5% even 0%.


- Turkey has announced zero tax on sunflower seeds imports. Will this neutralize the increased export taxes in Russia for Turkish importers and processors?

- Albeit zero-duty on sunflower seed imports, this will be almost useless since Turkey will suffer the shortage of importable supplies in Black Sea and other origins till new-season.


- Is it possible for Turkey to increase import of sunflower oil from Ukraine instead of Russia that increased export taxes?

- Refer to sunflower oil, Turkey traditionally prefers Russian origin (by Jan/Nov 2020, Turkey has imported 730 thsd tonnes of sunflower oil, including 545.5 thsd tonnes from Russia) since it’s rather cheaper than Ukrainian origin.

As long as Russia has no export tax for also sunflower oil, such trend will be kept.


- Turkey traditionally is a large importer of soybeans and soymeal. Please, tell us more about the current condition of this market segment in Turkey.

- Turkey raises only 150 thsd tonnes of soybean, but owing to huge demands from poultry sector, the soybean imports by 2019/20 season were as higher as 3.05 mln tonnes.

By Jan/Nov 2020, officially, Turkey imported 2.79 mln tonnes of soybean being mainly from Brazil (2110 thsd tonnes) and Ukraine (468.5 thsd tonnes).

By Jan/Nov 2020, officially, Turkey imported 479 thsd tonnes of soymeal being mainly from Argentina (296.5 thsd tonnes), Brazil (107.0 thsd tonnes), Bolivia (42.0 thsd tonnes) and Ukraine (32.5 thsd tonnes).

Normally, Turkey imports Ukrainian soybean actively by Sep/Feb, but lower Ukrainian new-crop size (3 mln tonnes vs 4.5 mln topnnes of 2019/20) has considerably reduced Turkish soybean imports and crushings/fullfat output nowadays.


- What are the prospects of sunflower seeds production in Turkey in a future season?

- Honestly, it’s early to speak, but as per my own opinion, the spring 2021 acreage will be higher due to much more lucrative prices vs grains. If we do not experience also unfavorable summer 2021 (unlike 2020’s), then Turkish oil-bearing sunflower seed new-crop size may be even record 1.65 – 1.75 mln tonnes vs 1.45 of 2020/21.


Interviewed by Polina Kalaida