Hazelnut Situation and Outlook
|Hazelnut production in selected countries in 1999/2000 is forecast to decrease 3 percent to 769,500 tons. Marginal production decreases in Turkey and Italy, the worlds first and second largest producers respectively, did not offset significant production increases in Spain and the United States. Total world hazelnut supply has increased significantly, up 15 percent from last year, mainly due to increased carryover stocks from FISKOBIRLIK. Total exports from selected countries in 1999/2000 are forecast to increase 6 percent to 465,400 tons, due to expanded exports from all countries except Italy. U.S. hazelnut exports are forecast at 20,400 tons, 78 percent above last year due to the significant increase in production.|
U.S. hazelnut production in 1999/2000 is forecast at 34,500 tons, up 145 percent from the previous years harvest, due to the crops alternate bearing cycle and good weather conditions. Virtually all the expected production will come from Oregon, except for an estimated 270 tons from Washington. Exports in 1999/2000 are forecast at 20,400 tons, 58 percent above the previous years shipments, due to the larger output. U.S. exports will face increased international competition from lower priced Turkish product. Relatively low hazelnut prices are expected to encourage consumption and increase imports.
Turkey is the worlds largest hazelnut producer, accounting for about 70 percent of world production. The 1999/2000 crop is estimated to be large and of good quality, although it is slightly down from last years record crop at 600,000 tons. High support prices continue to draw an excess of producers into the market, contributing to significantly expanded hazelnut plantings and production over the past few years. As a result, the industry suffers from overproduction, large stocks, and depressed prices. In the past few years, various Turkish governments have tried unsuccessfully to implement incentive programs to shift area back out of hazelnut production, to reduce the persistent hazelnut glut and raise grower prices. Hazelnut prices are determined by supply and demand as well as the prices of other nuts, particularly almonds (which are considered a low-cost substitute).
FISKOBIRLIK (The Union of Hazelnut Sales Cooperative) announced a 1999/2000 support price of USD$2.30/kg., but it remains to be seen whether it will actually receive the government funds needed to pay growers this price. It plans to buy about 150,000 tons of this years crop, paying growers a total of USD$350 million. This level is less than the 239,000 tons (USD$500 million) which FISKOBIRLIK bought the previous year. FISKOBIRLIK is also holding carryover stocks of 275,000 tons, which it plans to crush for oil rather than sell as kernels so as to eliminate further downward pressure on hazelnut prices.
Turkey accounts for more than 80 percent of world hazelnut trade. In 1999/2000, exports are forecast at 400,000 tons, 7 percent above the previous years shipments. Although the European Union is the major market for Turkish hazelnuts, Turkey is trying to expand other export markets, particularly in Asia, the former Soviet Union countries, and the United States. The bulk of domestic consumption continues to be whole nuts, although consumption of processed hazelnuts for confectionary items is also increasing. Domestic hazelnut consumption is expected to increase in 1999/2000, due to FISKOBIRLIKs crushing plans.
Hazelnut production in 1999/2000 is forecast at 105,000 tons, 11 percent below last years record crop, due to cyclical crop fluctuation and good weather conditions. Imports are expected to increase slightly, due to decreased production. Prices of Italian hazelnuts during 1998/99 have risen somewhat mainly, due to expanded export demand. However, pricing and exports will continue to be affected by FISKOBIRLIKs actions. Lack of Turkish government support of FISKOBIRLIK this year will mean intense competition from Turkish hazelnuts. The main export markets for Italian hazelnuts are other EU countries primarily Germany, France, and Switzerland.
In order to favor domestic producers, the EU is paying 15 EUROs per 100 kg. (USD$16), in-shell basis. This measure will expire at the end of the 1999/2000 marketing year, but will probably be replaced by other support actions.
The 1999/2000 hazelnut crop in Spain is forecast to increase dramatically to 30,000 tons, well above last years crop of 10,000 tons, due to the crops cyclical production and favorable weather conditions. Hazelnut exports are expected to increase and imports to decline as a result of the larger crop. U.S. hazelnut supplies represent about 5 percent of Spains total hazelnut imports and continue to face stiff competition from lower priced Turkish product, which accounts for 75 percent of Spanish imports. All Turkish hazelnut exports to Spain are shelled, while U.S. exports are in-shell. Higher total supply is expected to keep prices low and spur consumption in 1999/2000. The bulk of the hazelnut crop is consumed in-shell, with the confectionary and chocolate industries consuming 60-70 percent of total supplies.
While there is no price support program for tree nuts, the EU does have an improvement plan that is implemented in both Spains hazelnut and almond sectors. Up to 475 ECU/hectare can be provided to growers to plant improved, higher yielding varieties. EU producer organizations are concerned about the impending end of this program in 2000.
The FAS Attache Report search engine contains detailed reports on Tree Nut Competition or Market Intelligence for 16 countries, including Turkey, Italy, and Spain. (For information on production and trade, contact Lisa Anderson at 202-720-5028. For information on marketing contact Ingrid Mohn at 202-720-5330.)