Market Report for Turkish Raisins – October 2018

Since the beginning of the crop 2018, (01.09.2018), Turkey has exported around 45.500 m/tons of Sultana raisins until this week (Week 42) . This level is far higher comparing to the last year levels (around 41.000 m/tons). Also average price (for all grades) is around USD1780- p/mtons that level is around USD300- p/mtons higher than last year.

There are main quality problems this year that Mould level, Mycotoxines and Ochra results show that quality was not as good as the previous years. This is probably why that EU customs checks were increased in the arrival.

More farmers decided to produce Thompsons Raisins this year as a result of Thompson raw material worth much more than Sultanas last year. But the result, current offers are very close to each other in season 2018. Only concern that we should have, that Thompsons are dark colour so farmers that they have more mould problems decided to produce Thompsons in order to hide the colour diversion in raw material. But this problem ends up very high mould result in analysis that laser scanner are not very capable to sort our moulds out of the thompsons as product is almost same colour.

The main factor that both prices and export quantities depending on was the Turkish economy so far this year. As you can se below chart, USD currency rate against TL has increased more than 50% that factor diverted Turkish economy into deep trouble.

Starting the new crop, overseas buyers were expecting a major price decrease on the new crop Sultanas offers. We even saw some offers around USD1,6 p/Kg at the very beginning of the crop in August18. But soon after Inflation on Raw material prices came to then reality together with the high financial cost of buying Raw material for the processors.

For instance, it’s easier to compare inflation with the numbers. Last year, at the beginning of crop 2017 (in September 2017) Raw material of Sultana price was around 4 Lira/kg (USD1,15 at that day’s rate). But in 2018 Crop Raw material market started with 7 Lira/Kg (USD1,00 at that day’s rate).

So we can see the Raw material prices together with the inflation rate almost doubled but the USD prices were almost stable.
Come to today’s situation, Izmir Raw material exchange market prices for Standard size product is around 8,75TL/kg for Sultanas and 9TL/kg for Thompsons. This makes around 1,560USD (today rate) for the raw material and we well know almost all processors work for USD300/ton as processing cost. Finally, their offers must be between USD 1850 to 2000 m/tons depends on the grade of Sultanas.
For future expectations, we are facing nowadays fast decrease of USD currency rate against TL due to some political facts (5% only this week). And for result, final price offers are increasing daily basis. We see the demand is stable so far as a result of Turkish Sultanas is far more better prices comparing to Californian raisins.

In conclusion, we believe prices increase may continue in normal circumstances as finance cost is getting greater for the processors because of the economic structure, of course all depending on political facts that are the main reasons behind the USD rate fluctuations.
We hear rumours in other words about Iranian Sultanas quite cheap offers to EU as they have a big concern of EU may close the doors to any Iranian products soon following USA. Of course quality and cleanness is not comparable to Turkish Sultanas quality.

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