The Mintec Benchmark Prices of Turkish sultanas (type 9) FOB Turkey slid by 2.6% in the week ending 1st December 2021 and down by 5% month-on-month at USD 1,475/MT. The decline in prices follows a fall in the Turkish lira, down to 13.30 against the dollar on 1st December. The currency has since weakened further, to 13.81 against the dollar on 6th December.
Nonetheless, prices in Turkey are firming as sellers have been pricing in the weakening lira. The Turkish intervention agency, TMO, stopped sultana procurement on 30th November, estimated to have accumulated around 55,000-65,000 tonnes of dried grapes.
The market was quiet in Izmir in the first week of December, according to trade sources. A UK based trader noted, ‘Presently, the market is thin and not too much has been offered. The TMO has eaten into this year’s supply.’
Considering the TMO-held inventories, the current season Turkish dried grape supply is plentiful. In October, the EIB (Aegean Exporter’s Association) projected that Turkey would produce an estimated 290,000 tonnes of dried grapes in 2021/22, with additional 60,000 tonnes of a carry-in stock. This would take the overall supply in Turkey to 350,000 tonnes.
On the demand side, Turkey exported just over 73,000 tonnes of sultanas in the first three months of the new season, relatively unchanged from the previous campaign. Nonetheless, this is comparatively less to the 2019/20 campaign (88,130 tonnes) and 2018/19 (92,790 tonnes).
A UK based trader said, ‘Demand is static. Turkey hasn’t sold more sultanas than last year, which was a poor year’. Another EU importer added, ‘Demand is very strange to read. Everything is slow and there is lot of nervousness in the market. Low demand is presently the main deflationary influence on pricing’
Some market participants, however, expect prices to rise as farmers will want to pass on higher production and living costs following the soaring inflation. In November, Turkish inflation surged above 21%, according to TurkStat.
Moreover, Turkish sultanas are presently competitively priced, which some key stakeholders view as a key bullish factor on pricing. Indeed, at USD 1,475/MT, Turkish sultana prices hit a 4-year low and are 23% below the 10-year average (USD 1,914/MT).