• Export market relatively quiet last week.
  • However, good demand from the Turkish domestic market and speculative buying by exporters are driving up prices.
  • Turkish lira recovers (temporarily) positive signals from the tourism sector.
  • Commodity prices are now expected to rise steadily to the expected level of the TMO.

The past trading week was rather quiet in terms of demand from Europe. Nevertheless, we are now seeing a rise in commodity prices. The reason for this is, on the one hand, good demand from the Turkish domestic market, but also speculative buying by exporters. Many have pre-sold at a much lower level, such as the expected 50 TRY/kg (for natural 11-13 mm) and now see the danger of losses, especially as the Turkish Lira is recovering somewhat. The partly speculative purchases by exporters suggest that the price level for preparations could decouple from the market for natural kernels in the fourth quarter. We can expect a very inhomogeneous market again.

About the exchange rate, we saw a clear recovery at the end of the week. In Turkey, there are now signs of a slight recovery in some sectors. The tourism sector, for example, is reporting good booking figures for the coming months, something that the government had previously written off. Also, a meeting between President Erdogan and US President Biden will occur next week as part of the NATO summit to discuss differences. This is important insofar as important nodes of the new Silk Road are located in Turkey, and the Chinese project is not only viewed positively. Sooner or later, Turkey will have to take a clear position on its orientation not to become a pawn between the Western world, China and Russia. All this will shape the exchange rate of the national currency.

We expect one or two more enquiries for the coming weeks due to the rising export prices (raw material prices and exchange rates). Still, we continue to assume that the great demand for hazelnuts is coming soon. Concerning commodity prices, we expect that prices will now slowly but steadily move upwards.