Domestic livestock sector faces significant problems in Turkey

Despite such potential, the problems of the livestock industry in Turkey have not been resolved, while the sector faces significant hardships on the ground.

The latest OECD report on agriculture in Turkey states that historically the agricultural sector has been Turkey’s largest employer and a major contributor to the country’s GDP, exports and economic growth. According to the World Bank’s estimates, Turkey was the world’s seventh-largest agricultural producer in 2009, with agricultural GDP estimated by the Turkish Statistics Institute (TurkStat) at $51 billion in 2010.

Furthermore, according to said OECD report, Turkey is an important agricultural exporter, with agricultural exports estimated at $12.7 billion in 2010. Turkey continues to be a net exporter of agricultural products; the surplus helps to counter the persistent deficit in its non-agricultural merchandise trade. Agriculture supplied 11 percent of total exports and accounted for 7 percent of total imports in 2008. The EU is the main trading partner for Turkish agricultural products.

However, this rosy picture about crop and vegetable production gets blurred when it comes to livestock farming -- except poultry and what is called “red meat” production in the country. This is also reflected by people’s agricultural products consumption habits in Turkey.

The report also states that consumption rates for fresh vegetables and fruit are relatively high in Turkey, compared with other OECD countries. On the other hand, per capita consumption of red meat and milk is comparatively low. For example, per capita consumption of red meat in Turkey is about one-fifth of the EU average, and consumption of cows’ milk and eggs is, respectively, half and three-fourths of the EU level. Cheese and yoghurt are the preferred dairy products. Per capita consumption of sheep meat is higher than in the EU.

In terms of quantity, the most important meat product in Turkey is poultry, while in terms of value the most important meat product is beef. In response to a surge in domestic demand for poultry meat at the beginning of the 1990s, poultry production expanded rapidly. According to the OECD, Turkey is now the world’s 11th-largest poultry meat producer, with an output in excess of 1 million tonnes in 2008, showing a four-fold increase between 1995 and 2008.

The livestock sub-sector in Turkey, consisting mainly of cattle, dairy, buffalo, poultry, sheep and goats, includes traditional and commercial activities. Climatic and topographic conditions are favorable for fruit and vegetable production in the two coastal regions, namely the Aegean and Mediterranean coasts, while predominantly rural and mountainous areas specialize in livestock and animal products.

As the OECD report notes animal husbandry is an important part of Turkey’s agricultural sector, as natural conditions in the country are generally favorable for the increasing number of livestock, especially for grazing animals. According to TurkStat data the number of cattle totals approximately 11 million -- sheep around 24 million and goats about 6 million.

However, there is a combination of factors that has contributed to the livestock sector’s difficulties in Turkey in recent years. The small herd sizes, combined with domestic agricultural policies, have contributed to a steep downward trend in livestock numbers over time. The livestock sector occasionally was beset with animal health problems such as foot and mouth disease and avian influenza in 2005.

In addition to such in-sector factors that put a stump on the meat sector in Turkey there are also socio-economic factors, such as the rapid migration of young farmers to cities and the increasing age of livestock farmers, which plays an important but negative role in the livestock sector, according to the OECD. This fact was also voiced by a number of officials during a Sunday’s Zaman visit to city of Diyarbakır, where migration from rural areas is a major issue.

Beef production was relatively stable through the period of 1989-2008, at a level ranging between 338,000 tons in 1989 and 325,000 tons in 2009 per year; it is estimated to have reached 726,000 tons in 2010. However, together with the increasing population of Turkey and therefore the domestic demand and the major problems surrounding the livestock farming sector in the country, such an increase in meat production is clearly not sufficient. The outcome of the combination of these facts has been increasing meat prices in Turkey.

As the public cried foul over the higher-than-ever meat prices in Turkey in recent years, the government reduced tariffs on meat imports, carcass meat in particular, dropping the tariffs to zero for fatling imports in a bid to ease domestic prices. However, in time, the local livestock sector suffered from said policy as big firms tended to import cheap meat products, causing local meat producers to not be able to get rid of the animals ready to be slaughtered as simply they could not find a buyer at their asking price. Thus, the sector is reportedly on the brink of bankruptcy if the necessary measures are not taken hastily.

The recent reports published in the Turkish media suggest that livestock farmers around the country have difficulty finding a slaughterhouse to sell their animals at those prices. As such, the cost of each animal that was not slaughtered on time is close to TL 200 ($125) a month. Considering there are almost 2 million bovine animals in Turkey the size of the loss is obvious.

According to sources in the sector, the ratio of domestic production and bovines in the meat sector in Turkey is currently around 20 percent, while 80 percent is being imported. As data from the Ministry of Agriculture and Rural Affairs show, the amount of imported meat in Turkey in one year has reached up to 160,000 tons. The number of bovines and small cattle imports exceeded a million. The same sources say if the tariff barrier on the carcass meat import is raised to a certain level then the ratio would settle around mid-way.

Either way, the consumer gets the worst part of the deal as the profit margin for the sector is at more than 100 percent. Experts in the sector say the low quality meat that is being imported for TL 10 per kilo is being sold to customer at a price of TL 25. The high quality meat that is being imported for TL 13 per kilo is being sold in the domestic market for TL 27 on average. The current government’s decision to raise tariffs in May to 60 percent from the current 45 percent in a bid to protect the domestic producer will likely increase the selling price, which is already too high for so many across the country. In turn, it is likely to raise a few eyebrows at home where people are already paying high prices for meat products despite being one of the leading agricultural countries in the world.

Reform policies in the livestock and meat production sectors remain to be implemented by the new government to be formed following the upcoming June 12 general elections. It is experts’ opinion that in order to achieve a sustainable livestock farming sector in Turkey immigration from rural areas to big cities in Turkey’s east and southeast, where such a sector is dominantly a source of employment, should be reversed by introducing incentives and subsidies.