HOW WILL GRAIN TRADE IN THE WORLD CONTINUE AGAINST CRISES?
While crises in transportation of the food to the world, the war, climate change, price increases in agricultural commodities, and problems related to logistics are on the agenda of the grain sector with all their burdens, the most important meeting of the industry took place in Istanbul. At the IAOM Eurasia Congress and Exhibition, involving the world’s largest wheat producers and flour exporters; the leading company of Turkish wheat supply market, Taban Gıda and its parent company Vivalon was among the main sponsors.
The congress of The International Association of Operative Millers (IAOM), which operates in 14 different regions around the world and brings together industry professionals such as cereals, flour, pasta and feed producers; carried out in Istanbul. For three days, problems on production, trade and logistics and the effects of climate change on agriculture, especially the effects of the Russian-Ukrainian war on the wheat market, and the necessary solutions has been discussed. At the congress where Vivalon and Taban Gıda were among the main sponsors; The global impacts, especially the war between Russia, which alone represents 10 per cent of world wheat production and 30 per cent of the Eurasian region’s wheat production, and Ukraine, which came behind with 25 million tons of production, were among the most important issues.
Flour industrialists in Türkiye keep our country at the top in flour exports
Hasan Hacihaliloglu, CEO of Taban Gida, which has strong trade relations with Russia and Ukraine; conducts transit trade to about 20 countries on 5 continents and is the leader of the wheat supply market in Türkiye, took part as a speaker on the panel, where the cereals and milling sector were discussed. Hasan Hacıhaliloğlu “As you know, Türkiye has been at the peak of flour exports for many years. Despite all the difficulties, Turkish flour industrialists keep our country at the top in flour exports. Türkiye imports around 10 million tonnes of wheat every year, and most of this is done for flour and finished products exports. We are performing most of these imports as Taban Gıda. Rising costs and unpredictable markets are our biggest problem. It is very important for us to predict the market. Recent crises have made production and trade very difficult,” he said.
Our leading companies in the flour sector should invest in logistics
“One of the steps that can be taken in the flour sector is investing in logistics. I think that our leading companies in this sector can gradually enter into investments in sea transportation and move our country’s leadership in exports to much better places.” Hacıhaliloğlu remarked, “Rising costs in sea transportation seem to continue to be one of the most important problems for some time. We are trying to make it at least predictable to turn this into an advantage in our own sector, with the ship purchases of our parent company Vivalon.”
In order to meet the demand, digitalization in agriculture should be given importance!
Hasan Hacıhaliloğlu “With the growing world population, the need is also increasing. We need to take all the opportunities we have in order to meet these needs. And we can go on a path to solving this by digitizing agriculture. We need to take more planned and strong steps in this area. Türkiye’s soils will see the best in productivity when switching to smart agriculture practices. The most profitable crop will be planted in the right region. If the right crop is planted as needed in the right land, the supply and demand balance and therefore the right price will be formed. With digitalization, agricultural land will be used more effectively and production will be made for the needs. Thanks to this, the productivity of agricultural commodity will increase. Thanks to sustainable agriculture, we will leave healthier soils to future generations. This must be one of our greatest responsibilities towards the future.”
Tonnages are falling, companies hold stocks
Aras Demir, founder of Taban Gıda, and the parent company Vivalon, underlined that new problems are added to the already present problems with the pandemic during the panel in which global trade and investment policies were discussed. Demir
“With the pandemic, companies began to buy stocks quickly, which caused prices to rise in an instant. Afterwards, prices began to fall when holding stocks continued. This, in turn, caused fluctuations in the market. Companies that can’t predict their path continue to hold stocks because they can’t make long-term plans. As they continued trading with their own stocks, tonnages began to fall, which I think was a big blow to our industry.”
We want to be in every ring of the supply chain
Aras Demir said that they had problems related to logistics due to the pandemic, as well as the start of the Russian-Ukrainian war; “Especially during this period we had serious problems in terms of logistics. As Vivalon, we previously used part of our capital for ship purchases. This challenging period has shown how accurate that move has been. We bought two ships last year, and we bought another ship this year. We invested into three ships in total. With the war, we also began to have problems in terms of financing. Our business became difficult when the banks providing financing withdrew from the market. Therefore, we began to use our own capital. It is quite challenging to just stop at one point and manage the trade. We want to be in every ring of the supply chain. As Vivalon and Taban Gıda, we will continue to support all relevant sectors in our country with all the possibilities we can, with new instruments, investments in production, financing and logistics.”