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Turkey... Growing Market
for Vegoils & Fats
Faik Genç
AgriPro Limited
Black Sea Grain, Kiev
13-14 April 2011
1. World Oils/Oilseeds & Sun Complex
2. Turkey
3. Turkish Oils & Oilseeds Balances
4. Sun Complex
5. Sun Complex & Price Outlook
6. Conclusions
Main Topics
World Oils/Oilseeds & Sun Complex
World Oilseed Production (2010/11)
million tonnes/year
Soybeans 258.52
Rape/canola seeds 58.78
Sunflowerseeds 32.74
Cottonseeds 43.81
Groundnuts 23.78
Others 24.88
TOTAL 442.51
SOURCE: OIL WORLD/AgriPro 2011
World Vegoil Production (2010/11)
million tonnes/year
Palm Oils 47.53
Soya Oil 42.03
Rape/Canola Oil 23.23
Sunflower Oil 12.11
Cottonseed Oil 4.84
Groundnut Oil 4.15
Corn Oil 2.40
Others 2.45
TOTAL 146.30
(excl. olive oil)
SOURCE: OIL WORLD/AgriPro 2011
World Sunseeds Production (2010/11)
million tonnes/year
Ukraine 7.70
Russia 5.60
EU-27 7.03
Argentina 3.20
China 1.68
USA 1.32
India 1.00
TURKEY 0.90
Others 2.45
TOTAL 32.64
SOURCE: OIL WORLD/AgriPro 2011
Turkey
• Population : 78.7 million
• Population Growth : 1.235%
• GDP : US$ 729.1 billion
• GDP per capita : US$ 12,300
• GDP Growth 2010 : 7.3% (-4.7% in 2009)
• Exchange rate : US$ 1 = 1.53 Turkish Lira
Turkey Fact File
SOURCE : CIA WorldFactbook March, 2011
• Annual inflation (consumer): 8.7%
• Unemployment : 14%
• Age Structure : 0-14 ........ 26.6%
15-64 ....... 67.1%
65 & over ... 6.3%
• Meridian Age : 28.5
Turkey Fact File
SOURCE : CIA WorldFactbook March, 2011
• Fertility rate : 2.15/woman
• Urban Population: 70%
• Total Land : 783,563 sq km
• Arable Land : 29.81%
• Irrigated Land : 52,150 sq km
Turkey Fact File
SOURCE : CIA WorldFactbook March, 2011
Turkey Major Crops
• Wheat : c. 20 million tonnes
• Sugar beat : c. 16 million tonnes
• Corn : c. 4 million tonnes
• Barley : c. 7.5 million tonnes
• Oilseeds : c. 1.85 million tonnes
SOURCE : AgriPro, Dec. 2010
Turkey Oilseeds
SOURCE : AgriPro , Dec. 2010
• Sunflowerseeds : 900,000 tonnes
• Cottonseeds : 850,000 tonnes
• Rapeseeds : 50,000 tonnes
• Soybeans : 50,000 tonnes
TOTAL : 1,850,000 tonnes
Turkish Oils & Oilseeds Balances
Turkish Vegoil Market Sizeper capita consumption: 20.89 kg/year
Liquid oils : 12.57 kg per capita - 930,000 tons/year
Margarine : 7.14 kg per capita - 528,000 tons/year
Exports (Liquid/Margarine) Domestic LiquidDomestic Margarine Industrial (feed, paint etc.)
Liquid Oils Consumption(thousand tonnes)
691
734
707717
677
735 738
850 850
958
992
883
930
600
650
700
750
800
850
900
950
1000
1050
1997 1998 1999 2000 2001 2002-
2003
2003-
2004
2004-
2005
2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
Source: AgriPro 2011
Margarine Consumption(thousand tonnes)
404
368
420399 393
419437 450
488 500
562 550528
0
100
200
300
400
500
600
1997 1998 1999 2000 2001 2002-
2003
2003-
2004
2004-
2005
2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
Source: AgriPro 2011
Total Vegoil Oil Consumption(thousand tonnes)
1095 11021127 1116
1070
12091253
1397
1796
1637
1548
1377
1766
1000
1100
1200
1300
1400
1500
1600
1700
1800
1900
1997 1998 1999 2000 2001 2002-
2003
2003-
2004
2004-
2005
2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
Source: AgriPro 2011
Oilseeds Production(thousand tonnes)
Source: AgriPro 2011
Sunseeds Production(thousand tonnes)
560
595
500520
820
600
650
850
950
700
900
800
900
400
500
600
700
800
900
1000
1998 1999 2000 2001-
2002
2002-
2003
2003-
2004
2004-
2005
2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
2010-
2011
Sunseeds
Custom Duties change
Source: AgriPro 2011
Total Oilseeds Production(thousand tonnes)
19071941
1774 1760
2285
1895
1975
2145
2355
1995
2280
2095
1850
1.500
1.600
1.700
1.800
1.900
2.000
2.100
2.200
2.300
2.400
1998 1999 2000 2001-
2002
2002-
2003
2003-
2004
2004-
2005
2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
2010-
2011
Total Oilseeds
Source: AgriPro 2011
Turkish Oilseeds Production(without cottonseeds, 000 tonnes)
620
661
544560
915
645675
895
1005
745
980
895
1000
500
600
700
800
900
1.000
1.100
1.200
1998 1999 2000 2001-
2002
2002-
2003
2003-
2004
2004-
2005
2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
2010-
2011
Total Oilseeds
Custom Duties change
Source: AgriPro 2011
Sunseeds & Sunoil Imports(thousand tonnes)
6695
356
640
459
629
445
523
183129
228
581
520
407
490532
850
755
154
288 305
192228
157132
98133
91 67 82
149
431
123
337
432
184
0
100
200
300
400
500
600
700
800
900
1,993 1,994 1,995 1,996 1,997 1,998 1,999 2,000 2,001 2,002 2,003 2003-
2004
2004-
2005
2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
Sunseeds Crude Sunoil
Source: DTM/Undersecretariat of Foreign Trade
Soybeans & Soy Oil Imports(thousand tonnes)
30 58
169 149242
285353 387
321
612
760
621
1102
889
1216
1340
1076
1646
224133 140
100164 153 166 158 154 174
13376
123190
141
30 39 90
200
400
600
800
1,000
1,200
1,400
1,600
1,800
1,99
4
1,99
5
1,99
6
1,99
7
1,99
8
1,99
9
2,00
0
2,00
1
2,00
2
2,00
320
03-200
420
04-200
520
05-200
620
06-200
720
07-200
820
08-200
920
09-201
0
Soybeans Soy Oil
Source: DTM/Undersecretariat of Foreign Trade
Corn Oil Imports(thousand tonnes)
43
68
82 84
63
77
9791
117
109
81
112117
110104
65
52
0
20
40
60
80
100
120
140
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2003
-200
420
04-2
005
2005
-200
620
06-2
007
2007
-200
820
08-2
009
2009
-201
0
Source: DTM/Undersecretariat of Foreign Trade
Rapeseeds & Rape Oil Imports(thousand tonnes)
3 014 12
213
2234
12 12 8 29 10 5
20 152
10
105
190
220
113
262
0
50
100
150
200
250
300
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2003
-200
420
04-2
005
2005
-200
620
06-2
007
2007
-200
820
08-2
009
2009
-201
0
Rape/Canola Oil Rape/Canola seeds
Ukraine rapeseeds
arrive in the scene
Source: DTM/Undersecretariat of Foreign Trade
Palm Oil Imports(thousand tonnes)
244226 237
210
257
194 194
317
366399 386
450 440
588
435
523
420
510
0
100
200
300
400
500
600
700
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2003
-200
420
04-200
520
05-200
620
06-200
720
07-200
820
08-200
920
09-201
0
Source: DTM/Undersecretariat of Foreign Trade
Total Oils & Oilseeds Imports(thousand tonnes)
744 689 763595
734579 590
704 757 794699 691
833
1341
8111015 1028
758572
222 237
579
797 770
1.028850
1.089
536
796996
1.265
16911510
19982092
1747
2610
3200
0
500
1.000
1.500
2.000
2.500
3.000
3.500
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2003
/04
2004
/05
2005
/06
2006
/07
2007
/08
2008
/09
2009
/10
2010
/11
Oils Oilseeds
Custom Duties change
Source: DTM/Undersecretariat of Foreign Trade
Sunseeds : 27% (0% with tariff quotas)
($141.75 min.)
Soybeans : 8%
Rapeseed : 10% (min. $52.5/mt)
Crude Sunoil : 36%
Refined Sunoil : 50%
Other Vegoils : 31.2%
Major Grains : 130%
Protein Meals : 13.5%
Major Import Duties
Turkish Vegoil Exports
Main Destinations : Iraq, Syria, Algeria, Iran, EU-27, UAE
Sorce : DTM (Undersecretariat of Foreign Trade
Total Turkish Oil Demand(2009-2010)
Liquid oils : 930,000 tons
Margarine : 528,000 tons
Exports : 220,000 tons
Industrial : 88,000 tons
TOTAL : 1,766,000 tons
* Olive Oil excluded
Vegoils Suppy & Demand
383 407494 421 378
523429 438 516
582465
347446
1,0991,0981,1301,1311,0911,1541,253
1397
179616371660
1461
1766
0200400600800100012001400160018002000
1997
1998
1999
2000
2001
2002
-200
320
03-200
420
04-200
520
05-200
620
06-200
720
07-200
820
08-200
920
09-201
0
Total Supply Total Demand
� Crushing capacity: 5.0 mn tons
Utilisation : c. 75%
� Liquid Refining capacity: 2.0 mn tons
Utilisation : c. 70%
� Margarine capacity: 0.85 mn tons
Utilisation : c. 70%
Turkish Vegoil Production Capacity
Turkey Oilseeds Crush(thousand tonnes)
2343
2532 2593
2366
1948
2881 2815 28703040
3573
3262
2672
3253
0
500
1000
1500
2000
2500
3000
3500
4000
1997 1998 1999 2000 2001 2002-
2003
2003-
2004
2004-
2005
2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
Custom Duties change
GMO issue
Sun Complex
CME Soyoil vs. Grains 2009-11
CME Soyoil vs. Wheat 2009-11
Trend line
Trend line
CME Wheat 2009-11
Trend line
CME flat price increase 2009-11
Between 31.12.2008 & 08.04.2011
Wheat 77%
Corn 54%
Soybeans 70%
Soyoil 56%
CIF TR Sunseeds v Sunoil 2007-2011
CIF TR Sunoil v Soyoil 2007-2011
CIF TR Sunoil v Soyoil 2009-2011
$600
$700
$800
$900
$1,000
$1,100
$1,200
$1,300
$1,400
$1,500
30/12/08
12/1/09
26/1/09
9/2/09
23/2/09
9/3/09
23/3/09
6/4/09
20/4/09
4/5/09
18/5/09
1/6/09
15/6/09
29/6/09
20/7/09
3/8/09
17/8/09
31/8/09
14/9/09
28/9/09
12/10/09
26/10/09
9/11/09
23/11/09
7/12/09
21/12/09
1/1/10
15/1/10
29/1/10
12/2/10
26/2/10
12/3/10
26/3/10
9/4/10
23/4/10
7/5/10
21/5/10
4/6/10
18/6/10
2/7/10
16/7/10
30/7/10
13/8/10
27/8/10
10/9/10
24/9/10
8/10/10
22/10/10
5/11/10
19/11/10
3/12/10
17/12/10
31/12/10
14/1/11
28/1/11
11/2/11
25/2/11
11/3/11
25/3/11
8/4/11
CIF TR Crude Sunoil CIF TR Crude Degummed Soyoil
CIF TR Sunoil v Soyoil 2010-11
Sun-Soyoil Price Delta 2009-11
Sunoil Price v Delta 2009-11
World Sunoil Imports
World Sunoil Usage
Sun Complex & Price Outlook
• World sunflowerseeds production will increase by at least 2
million tons in 2011-12 season. Increase to come from Russia,
Hungary, Turkey & Argentina.
• The premium of sunoil over soyoil came down drastically, in the
first 4 months of 2011. Currently premium is at $80/mt on
origins FOB, and premium/discount of «NIL» on CIF Turkey
basis.
• EU-27 with 1 million tons, constitutes 22.5% of all sunoil
imports. But EU will buy less in 2011-12 season with better
EU/Ukrainian rapeseed production.
• Argentina with a production of 3.5 million tons will be a player
in the sunflower world trade, after several years, This will add a
bearish tone to sunseed/oil prices in 2011-12.
Facts
• India is an extremely price sensitive market in edible oils. When
sunoil spread narrows or goes negative, Indians switch to sunoil,
but not fully.
• Turkey imports 54% of all world sunseeds imports (1.54m tons)
and 4.5% of all world crude sunoil imports (4.42m tons).
• Ukraine exports c.350,000 tons of sunseeds, about 60-70% of
which destined for Turkey.
• Ukraine exports around 2.6m tons of sunoil, about 10% of which
destined for Turkey.
• Egypt and Turkey are the sole dedicated sunoil importers/users
in the world. However, Egypt opts for soyoil when price spread is
over $120-130/mt with sunoil.
Facts
• Turkey is the sole «dedicated» sunseeds/sunoil importer in the
world, REGARDLESS OF PRICE.
• Turkey each year, imports around 750,000 tons of
sunflowerseeds and 250,000 tons of crude sunoil AND
GROWING...
• Turkey imports, around 1.7 million tons of soybeans AND
GROWING...
• During big export years to the Middle East (2008/09) Turkish
crude sunoil imports can go up to 450,000 tons, some 10% of all
sunoil imports. I predict 2010-11 to finish around 300,000 tons.
Facts
• Japanese earthquake/tsunami disaster is largely priced and there
will not be a fresh financial meltdown in the global markets.
• Global growth of world economy to keep up with the rate of 3%,
minimum.
• There is no further problem with problematic EU economies
such as Portugal, Spain, Ireland etc.
• Petroleum oil prices remaining above $110 a barrel.
• There will be no major weather problems with 2011 US soy or
corn crops.
• US/South American biodiesel mandates remain in force.
Assumptions
• There will be severe price volatility throughout 2011 with hedge-
fund activity and political unrest mainly in the Middle East &
North Africa.
• I predict, world grains & oilseeds prices to be firm for the rest of
the season, mainly due to lower corn ending stocks in the US.
• However I don’t see edible oils maintaining current levels until
August 2011.
• For the new crop, I am bearish for the sunseeds & sunoil.
• The price spread between sunoil & soyoil will be the deciding
factor in the second half of 2011, for the sun complex. I predict
the sunoil premium over soyoil , continue to be very low.
Price Outlook
• $1,320/mt FOB Black Sea crude sunoil level is not sustainable until
June-July, when Turkish demand will rise in front of Ramadan.
• I predict FOB Black Sea sunoil prices to go up to $1,320-1,350 level
come next August, with Turkish demand, decreasing crush in the
Ukraine & soyoil demand rising for biodiesel in the US.
• We may see crude sunoil prices as low as, $950/mt FOB Black Sea
for the new crop (October-December 11).
• Sunflowerseeds price for October-December 2011 to be at $425-
$450/mt FOB Black Sea level.
• Indian demand can drive sunoil prices up to $1,200/mt FOB Black
Sea, in November-December 2011 period.
Price Outlook
• Grains & Oilseeds can go further up towards the end of the
season in the northern hemisphere with mineral oil prices being
the key factor.
• Sun complex price levels are not sustainable until July and for the
the new crop, with increased world sunflower production. But we
can see a price spike in August 2011.
• Indian demand in November-December 2011 will be the key
factor for the sun complex.
• Turkey is the largest destination of sunseeds/sunoil destination in
the world, regardless of price, AND GROWING.
Conclusions
Turkey... Growing Market
for Vegoils & Fats
Faik Genç, AgriPro Limited
Black Sea Grain, Kiev, 13-14 April 2011
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