TURKEY Big growth potential as firms modernise
Firms determined to boost exports

Turkish agribusiness is determined to raise standards in the industry and boost exports. Agriculture and rural affairs minister Husnu Yusuf Gokalp says it remains a key priority to raise the food sector to the level found in the EU member countries.
Already a major food exporter, Turkey is one of the world’s largest producers of fruit and vegetables, including tomatoes, potatoes and peppers. The dominant fruit is grapes, mostly allocated for raisin production, in which Turkey leads the US in terms of total exports. Despite favourable conditions, only two per cent of the entire grape harvest is used for wine, compared to an average of 85 per cent for the EU.

There is increasing depth to the agri-business sector as local firms continue to invest in new food-processing technology, improved facilities for cold storage and pack-aging, and developing better marketing techniques.
The country’s main canned food exports are olives, artichokes, tomatoes and tomato products, and aubergines – although many niche areas such as wine and beer also exist. Turkey’s bigger firms, which have considerable export experience, are showing the way for smaller companies.

Turkish processing giant Banvit aims to achieve more than $3 million in foreign sales for this year. The company, which was established in 1968 as an animal-feed producer, began processing chickens in 1985. Now listed on the Istanbul Stock Exchange, the firm is Turkey’s top poultry producer.
Banvit’s feed mills are located in Badirma and Bursa, in the South Marmara region, and supply farmers. The company works with around 60 breeders and 550 broiler contract suppliers. Banvit’s own hatchery has the capacity to produce more than 1.6 million eggs a week.

In 1998, Banvit instituted a ‘farm loan’ scheme to help farmers develop better housing for their poultry. The loan is not in the form of money but as equipment, with a 12-month payback period and a low rate of interest.
A new processing plant, which began operating in June 2001, has the capacity to output 300 tonnes a week of fresh, frozen and marinated chicken pieces. Another multi-purpose plant, which also opened last year, has a capacity of 6,000 hens and 750 turkeys per hour.

‘We are doing more ready made meals’ Omer Gorener

“We are able to process 240,000 chickens a day under one roof,” says Banvit assistant general manager Omer Gorener. The firm’s major export markets are China, Hong Kong and Azerbaijan. Occasionally, when the price is right, it also exports to the Balkan countries.
Mr Gorener says last year’s low prices resulted in Banvit making a loss for the first time. In the first nine months of 2001, the firm posted a net loss of $6.1 million, against a net profit of $1.1 million for the same period of the previous year.
Yet Mr Gorener remains upbeat when he looks to the future. “We are moving more and more towards added-value products,” he says. “We are producing ready-made meals such as burgers, salamis and even doner kebabs, and in the future we will add even more to our portfolio.”

Other companies are just as ambitious. Food processing firm Pinar, part of Yasar Hold-ing, announced in January that it plans to expand into EU markets later this year.
It has set up two companies in Germany – Yadex and Pinar Foods – to market its products there. Pinar also hopes to export some of its turkey meat to the Middle East in the near future.
Tat, part of the giant Koc conglomerate, is Europe’s largest producer of tomato paste, exporting across the globe. Other major players in this sector include Oztusan, Penguen, Akfa, Dardanel and Tukas.

Cereals, especially wheat and flour, are other important strengths. Local companies serve an increasingly wider market, meeting the region’s ever increasing demand for food products. Turkish firms have also started exporting varieties of pasta, instead of semolina, to markets in the EU and the US, as well as developing countries. Biscuit production is also rising, largely on the back of higher export volumes.
The international food business is a competitive place, but Turkey undoubtedly has a solid platform on which to build and create further value.