Market info - Hazelnuts
Hazelnuts
With the Turkish lira hitting new lows against the euro and US dollar and exporters issuing prices for hazelnuts that have nothing to do with the current market situation it is hardly possible for buyers to keep track of developments. Trouble is that the central bank again cut the key interest rate by 100 basis points on Thursday. Thereby, the bank is holding firm to President Recep Tayyip Erdoğan’s bizarre strategy of lowering interest rates while inflation spirals out of control.
This situation is highly unsettling for the hazelnut market. Although a rising inflation normally renders exports more attractive, buyers presently confronted with rising export prices. Issue is that most exporters are very hard hit by the depreciation of the lira, which is compensated by a sharp rise in raw nut prices. Traders, therefore, reckon that prices may very well exceed TRY 50.00/kg in the next few weeks. This situation has also prompted many exporters to start to withdraw from the market or to issue small quantities. The prices on offer have also drifted far apart and it pays for buyers to compare.As prices are not really aligned with the market but rather with exporters trying to cover costs it is, however, extremely difficult for buyers find appropriate offers. While some suppliers only offer small volumes, others also appear to be taking advantage of the situation. Prices in Georgia are, for instance, not necessarily more attractive as suppliers in Turkey tend undercut these offers. The whole situation is extremely complicated, and many buyers would prefer to secure contracts with a low-price guarantee to have more security. Traders are convinced that prices will continue to rise in the next few months and that the market will remain unsettled, although the upcoming Christmas holidays should calm things down a bit. They also expect the wide price gaps to remain.