Hazelnut Situation and Outlook
|Hazelnut production (in-shell equivalent) in four selected countries in 1998/99 is forecast to increase 23 percent to 752,970 metric tons. Production increases in Turkey, the worlds largest producer, and Italy, more than offset decreases in Spain and the United States. Total exports from selected countries in 1998/99 are forecast to increase 9 percent to 448,000 tons. Expanded exports from Turkey and Italy are expected to more than offset reduced shipments from the United States and Spain. U.S. hazelnut exports in 1998/99 are forecast at 14,000 tons, 45 percent below the previous years shipments, based on the sharply lower domestic harvest.|
U.S. hazelnut production in 1998/99 is forecast at 14,970 tons, in-shell basis, down 65 percent from the previous year's harvest, due to a light-bearing crop year and weather-related problems. Virtually all the expected production will originate from Oregon, except for an estimated 50 tons from Washington.
U.S. hazelnut exports in 1998/99 are forecast 45 percent below the previous year's shipments, due to the smaller harvest. U.S. Hazelnut exports will also face increased competition in international markets from Turkey, which has larger exportable supplies this season.
Turkey is by far the world's leading producer of hazelnuts, accounting for more than 75 percent of world supplies. The 1998/99 season is expected to yield a bumper hazelnut crop, with production projected at 600,000 tons, about 25 percent higher than the previous year. Weather conditions were very favorable during the early growing season. However, hot and dry weather during July and August in most areas reduced yields below initial expectations.
Turkey is the world's largest hazelnut exporter, accounting for more than 80 percent of world trade. In 1998/99 exports are forecast at 375,000 tons, 7 percent above the previous year's shipments, based on the larger harvest. Europe is the major market for Turkish hazelnuts. However, Turkey is looking to expand its exports to the Far East, former Soviet Union countries, and the United States. About four fifths of Turkey's hazelnut exports comprise raw kernels and the remaining one fifth consists of processed kernels, including roasted, sliced, chopped, paste, meal, and flour. Very few hazelnuts are exported as finished consumer confectionary items. The trend, however, is to move from raw exports to processed and finished products to capture increased value added. One constraint to increasing exports of hazelnut confectionary items is the relatively low quality of Turkish chocolate (an important base for hazelnut products) compared to European chocolate.
The hazelnut support price for marketing year 1998/99 was announced on August 10, 1998 at 2.26 U.S. dollars per kilogram. While this announced support price is viewed as an attractive one, the key question is whether FISKOBIRLIK (The Union of Hazelnut Sales Cooperatives) will be provided with funds to purchase significant quantities of hazelnuts. The Government of Turkey has reportedly promised to provide about TL150 trillion (about 500 million U.S. dollars) in funding for the procurement of 200,000 tons of hazelnuts from the 1998/99 crop. This level would be substantially higher than the 64,500 tons (150 million U.S. dollars) which FISTOBIRLIK procured in 1997/98.
FISKOBIRLIK currently holds about 125,000 tons of hazelnut stocks, with 64,500 tons from the 1997/98 crop and the remainder from 1996/97. FISKOBIRLIK has announced that the 1996/97 stocks will be crushed for oil or donated to military and schools. It is not clear yet what the policy will be for the MY 1997/98 carry over.
The 1998/99 filbert crop in Spain is forecast at 8,000 tons, well below the 1997/98 record crop of 18,900 tons. The expected decrease is attributed to the normal fluctuation in the production cycle of the orchards and to adverse growing conditions. Reflecting the smaller crop in 1998/99, imports are expected to increase while exports are forecast to decline.
The bulk of Spain's hazelnut crop is consumed domestically in shelled form. The confectionery and chocolate industries use about 60 to 70 percent of domestic supplies.
U.S. hazelnut exports to Spain represent about 7 percent of total hazelnut imports into Spain. While U.S. exports have grown modestly over the past few years, U.S. suppliers continue to face heavy competition from lower-priced Turkish hazelnuts, who supply about a 70 percent of Spain's imports. Nevertheless, large, good quality U.S. hazelnuts continue to have potential for growth.
Hazelnut production in 1998/99 is forecast at 130,000 tons (in-shell basis), 69 percent above the previous year's output. Weather conditions this year were generally favorable in all the major producing areas. Last year's crop was adversely affected by a frost in April, 1997.
Italian hazelnut exports in 1997/98 were down sharply due to a smaller harvest and increased competition from Turkey. However, larger production in 1998/99 and the European Union's suspension of a supplementary zero duty import quota for Turkey should result in sharply increased Italian hazelnut exports.
(For further information on supply, distribution and trade, contact Joseph Somers at 202-720-2974. For information on U.S. marketing opportunities, contact Ingrid Mohn at 202-720-5330.)