USDA attaché cuts Turkey’s 2021-22 wheat import estimate on currency depreciation

The Ankara attaché of the US Department of Agriculture’s Foreign Agricultural Service has reduced its estimate for Turkey’s wheat imports for marketing year 2021-22 (June-May) to 10.8 million mt, down 5 million mt from the previous estimate.

However, the volume is still close to 33% higher than imports in the previous marketing year.

The decline in wheat imports in the current marketing year is likely due to an expected increase in barley imports and a depreciation of the Turkish Lira against the US dollar.

According to the Central Bank of the Republic of Turkey, $1 was equivalent to Lira 13.5 Jan. 20, compared with Lira 7.4 a year ago.

Turkey is a major wheat importer and usually sources its requirements from Russia and Ukraine. It is also a key exporter of wheat flour and wheat products.

The estimate of the attaché is lower than the official estimate of the USDA. In the latest World Agricultural Supply and Demand Estimates report released Jan. 12, it pegged Turkey’s wheat imports at 11 million mt.

“The current import estimate assumes TMO [Turkish Grain Board] will continue purchasing imported wheat until Turkey’s next wheat harvest and a projected slowdown in feed demand in the second half of the marketing year,” the USDA said in the report.

According to the Turkish Statistic Institute, Turkey’s wheat imports during the first six months of MY 2021-22 (June-November 2021) rose 20% year on year to around 5.3 million mt, of which 144,000 mt was durum wheat.

Export outlook

The attaché of the USDA has increased its projection slightly for Turkey’s MY 2021-22 exports of wheat and wheat products, projecting Turkey’s wheat exports at 6.6 million mt, up from 6.3 million mt in its previous estimate.

The estimate is also higher than the USDA’s official projection of 6.3 million mt, and up from 6.5 million mt a year earlier.

“This estimate assumes better flour exports than last year, and stable exports of pasta and transshipped wheat to neighboring countries,” the attaché said in its report.

The attaché has kept its estimate for Turkey’s MY 2021-22 wheat production steady at 16.3 million mt. However, the projection is 2 million mt lower on the year.

Output is seen lower on the year as due to drought conditions across much of the country during the growing season, the attaché said in the report.

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Tags: Turkey, wheat