The Turkish dried fruit sector is currently navigating a period of significant uncertainty and challenge, largely driven by the Turkish Grain Board's (TMO) decision to scale back its raw material purchases in the sultana market and a pervasive weakness in overseas demand. This dual pressure is creating a volatile environment for farmers and processors alike, with particular concern surrounding the dried fig sector where government intervention remains ambiguous. The TMO's reduced presence, coupled with a strong Turkish Lira making exports less competitive, is forcing a re-evaluation of strategies for one of Turkey's key agricultural exports, threatening both farmer livelihoods and Turkey's global market share.

TMO's Retreat and Market Instability

The Turkish Grain Board (TMO), a traditional pillar of stability in Turkey's agricultural markets, has largely ceased its raw material purchases in the sultana sector as of October 21, 2025. While collection points in Salihli and Alaşehir are expected to continue operations until the end of the year, the TMO is estimated to have acquired only about 6,000 metric tons (mt) of sultanas this season. This marks a significant departure from previous periods where TMO intervention helped stabilize prices and offered a crucial alternative market for growers. Concurrently, Tariş, a prominent agricultural cooperative, acquired a more substantial 20,000 mt, yet its own early termination of purchases in the dried fig market has already contributed to price declines and heightened farmer anxiety.

The 2025/2026 dried fig export season officially commenced on October 15, 2025, but it has been met with immediate grower dissatisfaction due to sluggish demand for raw materials. The uncertainty surrounding potential TMO intervention in the dried fig market, following Tariş's premature withdrawal, has left many farmers without reliable buyers. This situation is particularly acute for dried fig growers, who are grappling with rising production costs and a notable decline in prices, especially for smaller-sized figs. The lack of institutional buyers has amplified market volatility, leaving farmers vulnerable to private buyers and potentially depressed prices.

Initial market reactions have been characterized by caution and apprehension. Sultana growers, many of whom were anticipating higher prices fueled by TMO intervention, are now reportedly holding back sales, hoping for a market rebound that seems increasingly distant. For dried fig processors and exporters, the historical specter of quality control issues, particularly the significant increase in aflatoxin and ochratoxin rejections at EU borders during the 2024/2025 season, is leading to extreme caution. Exporters are stocking only minimal quantities for immediate shipments, awaiting positive feedback and analytical results from buyers before committing to further purchases, further dampening raw material demand.

Companies Grapple with Market Headwinds

The current market dynamics present a challenging landscape for various stakeholders in the Turkish dried fruit sector, creating both potential losers and a few, albeit limited, opportunities. Farmers, particularly those in the sultana and dried fig sectors, are unequivocally facing the brunt of the TMO's reduced intervention and weak overseas demand. Sultana farmers, especially those who rely on institutional purchases to stabilize prices, are seeing their leverage diminish. Dried fig farmers are in an even more precarious position, battling sluggish demand, declining prices for smaller figs, and the lingering uncertainty of TMO support after Tariş's early exit. Rising production costs further erode their already thin margins, threatening their financial viability.

Turkish processors and exporters, while potentially benefiting from lower raw material prices in a highly competitive environment, are simultaneously confronting significant headwinds. Companies like Anatolia Dried Fruits (IST: ANADF) and other major exporters face increased competition from cheaper suppliers, notably from Iran, which offers sultanas at significantly lower prices (USD 2,800-2,900/mt compared to Turkey's USD 3,050-3,200/mt for Type 9). The strong Turkish Lira, a consequence of the government's high-interest rate policy, makes Turkish exports more expensive on the global market, complicating long-term cost calculations and hindering their ability to secure international contracts. This currency effect disproportionately impacts companies heavily reliant on export revenues.

Furthermore, the persistent quality control issues, particularly the high rejection rates of dried figs at EU borders due to aflatoxin and ochratoxin, impose substantial additional costs and reputational damage on exporters. Companies that experienced export bans or incurred significant expenses due to rejections in the 2024/2025 season are now exercising extreme caution, delaying purchases of raw materials until quality assurances are met. This cautious approach, while necessary for compliance, directly translates to reduced demand for farmers' produce. Smaller, less diversified processors may struggle to absorb these increased costs and market volatility, potentially leading to consolidation or exits from the market. Conversely, well-capitalized companies with robust quality control systems and diversified market access might be better positioned to weather the storm and potentially gain market share from struggling competitors in the long run.

Broader Industry Trends and Global Implications

The current turbulence in the Turkish dried fruit sector is not an isolated event but rather a confluence of broader industry trends and policy implications that are reshaping Turkey's position in the global market. The TMO's decision to scale back intervention reflects a potential shift in government policy, moving away from direct market support towards a more market-driven approach, or perhaps a reallocation of resources. This fits into a broader trend of governments worldwide re-evaluating agricultural subsidies and interventions. However, for a sector as sensitive as dried fruits, where production is largely by small-scale farmers, such a withdrawal without alternative support mechanisms can have destabilizing effects.

The strong Turkish Lira, a direct consequence of the government's aggressive high-interest rate policy aimed at combating inflation, is a double-edged sword for the export-oriented dried fruit industry. While it may help curb domestic inflation, it significantly inflates the cost of Turkish products on the international stage, making them less competitive against rivals from countries with weaker currencies. This policy creates a ripple effect, reducing demand for Turkish sultanas and figs, and potentially forcing buyers to seek alternatives from countries like Iran or even California, impacting long-term trade relationships and Turkey's market share. The 30% reduction in Turkish sultana exports for the current season compared to last year underscores this challenge.

Regulatory and policy implications are particularly severe in the dried fig sector. The alarming increase in dried fig rejections at EU borders during the 2024/2025 season due to elevated aflatoxin and ochratoxin levels is a critical issue. This not only leads to significant financial losses for exporters but also damages Turkey's reputation as a reliable supplier of quality dried figs. This event has historical precedents; similar quality concerns have plagued other agricultural exports globally, often leading to stricter import regulations and a permanent shift in buyer preferences if not addressed swiftly and comprehensively. The EU's stringent food safety standards mean that sustained quality issues could lead to long-term export bans for certain companies or even the entire sector if not mitigated effectively. This highlights the urgent need for robust quality control measures across the entire supply chain, from farm to processing.

Navigating the Future: Challenges and Opportunities

The immediate future for the Turkish dried fruit sector, particularly for sultanas and dried figs, is likely to be characterized by continued volatility and uncertainty. In the short term, the absence of a strong institutional buyer like the TMO will likely lead to greater price fluctuations and increased pressure on farmers to accept lower prices from private traders. Processors will continue to prioritize prompt shipments, avoiding long-term commitments until global demand strengthens and pricing becomes more predictable. The current subdued overseas demand is not expected to improve dramatically in the coming months, meaning exporters will have to contend with intense competition and price sensitivity from international buyers.

In the long term, strategic pivots and adaptations will be crucial for the sector's survival and growth. For farmers, this may involve exploring alternative crops, implementing advanced farming techniques to improve yields and quality, and potentially forming stronger cooperatives to enhance their bargaining power. For processors and exporters, investing in state-of-the-art quality control technologies and processes will be paramount to regain buyer trust and meet stringent international standards, especially concerning mycotoxin contamination in dried figs. Diversifying export markets beyond traditional European buyers could also mitigate risks associated with over-reliance on a single region.

Market opportunities, though currently overshadowed by challenges, may emerge. The underlying supply constraints for sultanas, stemming from crop challenges in 2024 and limited carryover, could prevent a drastic collapse in prices, particularly if domestic demand from the Turkish alcohol industry remains robust for lower-quality sultanas. For dried figs, a renewed focus on premium quality, organic production, and innovative product development could carve out niche markets with higher margins. However, these opportunities are contingent on significant investment in quality infrastructure and a concerted effort across the supply chain to address fundamental issues. Potential scenarios range from a prolonged period of consolidation and reduced export volumes to a gradual recovery driven by quality improvements and strategic market diversification, provided there is effective government support and industry collaboration.

Conclusion: A Critical Juncture for Turkish Dried Fruits

The Turkish dried fruit sector stands at a critical juncture, with the TMO's reduced involvement and persistent weak overseas demand for sultanas and dried figs creating a challenging environment. The immediate implications include increased price volatility for farmers, intense competition for processors, and a significant reduction in export volumes for sultanas. The strong Turkish Lira further exacerbates these challenges, making Turkish products less competitive on the global market.

Moving forward, the sector's resilience will depend on its ability to adapt to these evolving dynamics. Key takeaways include the urgent need for enhanced quality control, particularly for dried figs to address recurring aflatoxin issues, and the necessity for farmers and processors to explore new strategies in the absence of traditional government support. The market will likely continue to be influenced by global economic conditions, currency fluctuations, and the effectiveness of industry-wide efforts to improve product quality and market access.

Investors should closely monitor several factors in the coming months: any shifts in TMO policy or the introduction of alternative government support mechanisms, the performance of the Turkish Lira against major currencies, the success of quality control initiatives in the dried fig sector, and the overall trajectory of global demand for dried fruits. The ability of Turkish companies to innovate, diversify, and maintain high-quality standards will ultimately determine the long-term health and competitiveness of this vital agricultural industry.

This content is intended for informational purposes only and is not financial advice