COTTON MARKET IN TURKEY

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COTTON MARKET IN TURKEY
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CONTENT

• I. Introduction
• II. General View Of The Market
• Cotton Production in Turkey
• Cotton Consumption in Turkey
• Cotton Import and Export in Turkey
• III. Policies
• General Description Of Current Policies
• Organization of Cotton Market
• IV. Policy Implications and Conclusion

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INTRODUCTION

• Turkey is one of the eight biggest countries
  which produce the 80 of cotton in the world.
  From the Turkeys side, cotton as a raw material
  is really important for our main industries
  especially for the textile and ready-to-wear
  clothing sectors.
• Textile is the most important related industry
  with cotton. Both cotton and textile are the most
  subjected to different government interventions
  in the world.

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COTTON PRODUCTION IN TURKEY

• INTERNATIONAL POSITION

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Source Anonymous, 1999-2003a.
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COTTON PRODUCTION IN TURKEY

• COTTON PLANTATION AND PRODUCTION

Source Anonymous 2001 and Anonymous 2003a
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COTTON PRODUCTION IN TURKEY

• COTTON PLANTATIONS ACCORDING TO REGIONS

Source Anonymous, 2003a and Özüdogru, 2002.
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COTTON PRODUCTION IN TURKEY

• COTTON PRODUCTION ACCORDING TO REGIONS

Source Anonymous, 2003a and Özüdogru, 2002.
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COTTON CONSUMPTION IN TURKEY

• THE MAIN FACTORS FOR COTTON CONSUMPTION
• Improving textile and confection sector
• Rapidly increasing world population
• Increasing GDP per capita levels
• Price of Synthetic Fiber and its consumption

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COTTON CONSUMPTION IN TURKEY

• Although Turkey is one of the biggest cotton
  producer in the world, it covers its consumption
  needs by import. The main reason of that is
  rapidly improving textile sector and opportunity
  to buy cheaper cotton from foreign countries than
  the domestic and credit possibilities especially
  from U.S.

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COTTON CONSUMPTION IN TURKEY
Source TUIK
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COTTON IMPORT AND EXPORT

• TURKEYS COTTON IMPORT ACCORDING TO COUNTRIES
  (000/tons)

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COTTON IMPORT AND EXPORT

• TURKEYS COTTON EXPORT ACCORDING TO COUNTRIES
  (000/tons)

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III. POLICIES

• In our country,
• Aegean
• Çukurova
• Antalya
• Southeast Anatolian
• are the main regions for the cotton production.

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• In the European Union, especially Spain and
  Greece produce approximately 350 thousands ton
  cotton. And in these countries the high support
  rates make the production costs lower according
  to Turkey. But, the limited cotton production in
  the EU and limited amount of cotton that comes
  from the EU to Turkey does not affect the cotton
  producers negatively in our country.

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• In the production of cotton one of the most
  important factors is labor power and in our
  country approximately 6 million people are
  working on the cottons plantations for their own
  living.
• In the world, the cotton is cultivated in many
  countries and because of this reason
  international institutions have many studies and
  rules for this product.
• But, although in 29 OECD countries there have
  been studies for 13 products, the cotton has not
  been one of them. Consequently, in OECD countries
  the calculations for supports to cotton producers
  or taxation of consumers related to cotton have
  not been done.

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Current Policies

• When we look at the domestic support mechanism in
  favor of the cotton production in Turkey, there
  are three different support schemes
• 1. Support Premium
• 2. Direct Income Support
• 3. Diesel and Chemical Fertilizer Support
• There are no guaranteed
• -minimum prices,
• -national production quantities
• for the cotton producers.

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• 1. Support Premium Income support payment per kg
  has been provided to the cotton producer under
  the name of Support Premium. Domestic and foreign
  market prices, costs of the producers and
  budgetary means have been taken into
  consideration in determination of the amount of
  the support.
• 2. Direct Income Support Within the scope of the
  Direct Income Support system, income support
  payment has been provided to the cotton producers
  as well as other products up to 50 hectares in
  accordance with the By-law on National Farmer
  Registration System.
• 3. Diesel and Fertilizer Support Diesel and
  Fertilizer Support have been provided to the
  cotton producers

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• In case of the determination of an unfair support
  payment, payments made are recovered with its
  interest from the farmers who have benefited from
  the payment. Natural and legal person who forge
  the documents or certificates, which lead to
  unfair payment, are also successively bound for
  the amounts, which will be recovered.

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Organization of the Market

• Cotton is purchased by the cooperatives and
  ASCUs, ginning plants and traders. Almost all of
  the cotton producers have been organized within
  the framework of the 89 agriculture sales
  cooperatives and 4 Unions. These institutions
  have important roles in the domestic trade of
  cotton. Agriculture Sales Cooperatives and ASCUs
  (namely Taris Pamuk Birligi, Çukobirlik,
  Antbirlik and GAP Birlik) purchase approximately
  20 of the total cotton production in Turkey.

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IV.POLICY IMPLICATIONS AND CONCLUSION

• When we consider the cotton data in Turkey, while
  cotton production has shown a trend of reasonable
  increase, cotton consumption also has displayed
  increasing behavior.
• With the significant investments in textile and
  confection sectors, the cotton production
  witnessed an accelerated increase from 1950 to
  1973.
• When we look at the 1989-1991 periods, there was
  not any price support mechanism, neither on trade
  restrictions nor exports and imports of cotton.

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• In the beginning of 1990s, the Turkish government
  returned to the support price mechanism with the
  decrease of world cotton prices. But, this
  mechanism did not provide sufficient increase in
  cotton production because of several reasons.
• Firstly, the level of support prices set was not
  adequate in comparison to the supports given in
  some other countries.
• Secondly, the support price system was
  implemented through the agricultural sales
  cooperatives unions (ASCUs), which procured
  roughly 1/6 to1/3 of the total crop, the
  remaining quantity being left to private sector
  procurements.

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• As a result, according to Turkeys conditions,
  the cotton prices in the world is still lower and
  the cost of production as some countries continue
  to subsidize their cotton industries is well
  below. At this situation, as many other cotton
  producing countries, Turkeys cotton production
  sector meets with difficulties and remains under
  increased pressure.

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• THANKS FOR YOUR ATTENTION
• Burcu-Ahmet