Agricultural Policy Monitoring and Evaluation 2023

26. Türkiye

Support to agriculture

Türkiye’s transfers to agricultural producers are near the OECD average at about 16% of gross farm receipts in 2020-22, a decline from 25% in 2000-02. About 57% of support is market price support (MPS) generated by tariffs, combined with reductions of exporters’ debts and equity injections to state enterprises. While this is above the OECD average, the role of MPS has declined since 2000-02. Producer prices were about 11% above border prices in 2020-22, primarily because of support for beef, poultry, eggs, and sunflowers. Prices of other commodities are more aligned with border prices. Premium payments to producers of specific commodities are also provided, and these combine with MPS to cause the share of support considered most-distorting to be 86% in 2020-22, close to double the OECD average of 44%. Other forms of support are area-based payments provided as crop insurance, and support to defray the cost of diesel and fertiliser.

General support to the sector (General Service Support Estimate, GSSE) was 4.3% of the value of agricultural production in 2020-22, above the OECD average but down from 15.4% in 2000-02. However, 2000-02 had unusually high duty-loss payments due to a surge in inflation, and the current level more closely reflects historical averages. The largest components of the GSSE are for development and maintenance of infrastructure (mainly irrigation), and marketing and promotion (duty-loss payments and equity injections). Total support to the sector (Total Support Estimate, TSE) was 1.6% of GDP in 2020-22. This is less than the 3.9% in 2000-02 – reflecting a faster pace of overall economic growth compared to the sector – but remains well above the OECD average.

Recent policy changes

State-supported agricultural insurance expanded in 2022 with the introduction of revenue-protection. Producers affected by natural disasters are eligible for additional support and grants. Revenue-protection insurance covers 70% of insured farm revenue against yield losses and price variations.

The Department of Security of Supply was established in 2022 to follow national and international production trends, and develop measures to secure supply of strategic agricultural products. The Supply Security Monitoring System will be improved to support supply security in agricultural products.

As of 2022, diesel and fertiliser supports are delivered via a card issued by the Ziraat bank, which may only be used for the purchase of diesel and fertiliser. This replaces a cash-based system for this per-hectare payment. Interest-reduced agricultural credits through Ziraat Bank and the Agricultural Credit Cooperative were also modified. Farmers can get zero-interest credit from Ziraat Bank for traditional (widespread) crop production up to TRY 200 000 (USD 12 077), but they must use any borrowing above TRY 100 000 (USD 6 038) only to purchase diesel or fertiliser.

Türkiye eliminated the export subsidy entitlements for agriculture products or groups of products as of the end of 2022 in accordance with the Nairobi Ministerial Decision on Export Competition.

Support levels in most budgetary programmes increased by varying degrees, in the context of rising consumer price inflation.

Assessment and recommendations

• Agriculture in Türkiye is affected by climate change, with the sector expected to face increasing aridity and frequency of droughts. Efforts to implement water pricing for users are helping increase water-use efficiency, but on-farm awareness, preparedness, and adaptation to drought risks are key to reduce farming communities’ vulnerability and build agricultural resilience. Targeted training programmes and extension services can inform farmers about the use of efficient irrigation techniques and drought-adapted farming practices.

• Current policies aim to reduce the farm sector’s vulnerability to drought while encouraging the production of water-intensive crops, which sends contradictory signals to farmers. Moving from production-linked support for certain commodities to providing sector-wide services that enhance the sector’s capacity to prepare, prevent, absorb, and reconstruct can help sustainable productivity growth. This could include more support for research and development (R&D) of drought-resistant varieties, encouraging the adoption of water-saving crop varieties, and providing education and training to build on-farm capacities to adopt and implement drought-resilient management.

• Agricultural policies (including MPS) strongly influence farmers’ production decisions, and state enterprises are important in the product marketing system for certain commodities. Commodity-specific support, self-sufficiency targets, and planned agricultural production should be replaced by policies to improve the competitiveness, efficiency, and sustainability of production as part of a holistic policy for the food supply-chain. Such reform would be of particular benefit to consumers, who faced rapidly-increasing food prices in 2022.

Figure 26.1. Türkiye: Development of support to agriculture

 

 

 

 

 

Source: OECD (2023), “Producer and Consumer Support Estimates”, OECD Agriculture statistics (database), http://dx.doi.org/10.1787/agr-pcse-data-en.

Figure 26.2. Türkiye: Drivers of the change in PSE, 2021 to 2022

Note: % change of nominal Producer Support Estimate expressed in national currency. The producer price change and the border price change are not calculated when both negative and positive market price support (MPS) occur at the commodity level for the previous year. Note that negative MPS estimates for livestock products may arise in cases of aligned product prices if there is positive MPS for feed commodities.

Source: OECD (2023), “Producer and Consumer Support Estimates”, OECD Agriculture statistics (database), http://dx.doi.org/10.1787/agr-pcse-data-en.

Figure 26.3. Türkiye: Commodity-specific transfers as a percentage of commodity gross receipts, 2020-22

Source: OECD (2023), “Producer and Consumer Support Estimates”, OECD Agriculture statistics (database), http://dx.doi.org/10.1787/agr-pcse-data-en.

Table 26.1. Türkiye: Estimates of support to agriculture

Million USD

	1986-88	2000-02	2020-22	2020	2021	2022p
Total value of production (at farm gate)	18 343	22 169	58 050	52 251	53 410	68 491
of which: share of MPS commodities (%)	55.00	71.38	84.52	79.81	87.87	85.89
Total value of consumption (at farm gate)	15 837	22 577	64 562	56 854	62 502	74 329
Producer Support Estimate (PSE)	4 304	6 045	10 884	13 995	8 957	9 699
Support based on commodity output	3 419	5 158	7 159	6 501	7 086	7 891
Market Price Support1	3 408	4 836	6 270	5 588	6 165	7 056
Positive Market Price Support	3 412	4 853	6 300	5 624	6 220	7 056
Negative Market Price Support	-3	-16	-30	-36	-55	0
Payments based on output	11	321	890	913	922	835
Payments based on input use	885	426	2 658	6 422	748	803
Based on variable input use	850	302	2 097	5 102	546	642
with input constraints	0	0	0	0	0	0
Based on fixed capital formation	19	116	513	1 273	131	136
with input constraints	0	0	0	0	0	0
Based on on-farm services	16	8	48	47	71	26
with input constraints	0	0	0	0	0	0
Payments based on current A/An/R/I, production required	0	25	1 067	1 072	1 123	1 005
Based on Receipts / Income	0	0	203	210	176	224
Based on Area planted / Animal numbers	0	25	863	862	948	780
with input constraints	0	0	49	54	48	44
Payments based on non-current A/An/R/I, production required	0	0	0	0	0	0
Payments based on non-current A/An/R/I, production not required	0	436	0	0	0	0
With variable payment rates	0	0	0	0	0	0
with commodity exceptions	0	0	0	0	0	0
With fixed payment rates	0	436	0	0	0	0
with commodity exceptions	0	0	0	0	0	0
Payments based on non-commodity criteria	0	0	0	0	0	0
Based on long-term resource retirement	0	0	0	0	0	0
Based on a specific non-commodity output	0	0	0	0	0	0
Based on other non-commodity criteria	0	0	0	0	0	0
Miscellaneous payments	0	0	0	0	0	0
Percentage PSE (%)	22.73	25.54	16.09	23.07	15.94	13.63
Producer NPC (coeff.)	1.23	1.29	1.11	1.12	1.14	1.10
Producer NAC (coeff.)	1.29	1.34	1.19	1.30	1.19	1.16
General Services Support Estimate (GSSE)	333	3 507	2 226	1 076	1 952	3 650
Agricultural knowledge and innovation system	67	29	48	64	47	34
Inspection and control	51	67	12	13	11	14
Development and maintenance of infrastructure	22	513	1 369	807	1 408	1 892
Marketing and promotion	95	2 888	796	192	486	1 710
Cost of public stockholding	0	0	0	0	0	0
Miscellaneous	99	11	0	0	0	0
Percentage GSSE (% of TSE)	7.39	36.34	20.14	7.14	17.89	27.34
Consumer Support Estimate (CSE)	-3 032	-4 861	-5 071	-4 441	-6 068	-4 705
Transfers to producers from consumers	-3 027	-4 553	-4 594	-4 054	-5 033	-4 694
Other transfers from consumers	-49	-340	-738	-709	-1 494	-11
Transfers to consumers from taxpayers	0	0	0	0	0	0
Excess feed cost	43	33	260	322	459	0
Percentage CSE (%)	-19.70	-21.12	-7.46	-7.81	-9.71	-6.33
Consumer NPC (coeff.)	1.25	1.27	1.08	1.09	1.12	1.07
Consumer NAC (coeff.)	1.25	1.27	1.08	1.08	1.11	1.07
Total Support Estimate (TSE)	4 637	9 552	13 110	15 071	10 909	13 349
Transfers from consumers	3 075	4 893	5 332	4 763	6 527	4 705
Transfers from taxpayers	1 611	4 999	8 516	11 017	5 876	8 655
Budget revenues	-49	-340	-738	-709	-1 494	-11
Percentage TSE (% of GDP)	4.00	3.91	1.57	2.09	1.33	1.51
Total Budgetary Support Estimate (TBSE)	1 229	4 716	6 840	9 483	4 745	6 293
Percentage TBSE (% of GDP)	1.07	1.96	0.79	1.32	0.58	0.71
GDP deflator (1986-88=100)	100	139 552	1 719 647	1 083 416	1 397 071	2 678 455
Exchange rate (national currency per USD)	0.00	1.12	10.81	7.02	8.86	16.56

Note: p: provisional. NPC: Nominal Protection Coefficient. NAC: Nominal Assistance Coefficient. A/An/R/I: Area planted/Animal numbers/Receipts/Income. 1. Market Price Support (MPS) is net of producer levies and excess feed cost. MPS commodities for Türkiye are: wheat, maize, barley, sunflower, sugar, potatoes, tomatoes, grapes, apples, cotton, tobacco, milk, beef and veal, sheep meat, poultry and eggs.

Source: OECD (2023), “Producer and Consumer Support Estimates”, OECD Agriculture statistics (database). http://dx.doi.org/10.1787/agr-pcse-data-en.

Description of policy developments

Overview of policy trends

Before 1980, an import substitution policy was in place in Türkiye and agriculture was tightly controlled to meet policy objectives, which included maintaining stable grain prices, increasing yields and production and developing exports. Some agricultural products were taxed while others received subsidies, but the sector was a net payer to the government budget overall.

From the 1980s until 2000, the sector was a net beneficiary of support, directed towards import-competing farm products. The main agricultural policy instruments were price support for crop products and input subsidies. Programmes provided low-cost credit, agricultural chemicals, seeds, irrigation, and fertiliser. Livestock production was supported mainly through border measures.

State enterprises managed intervention buying, in the form of State Economic Enterprises (SEEs) as exclusive purchasers of grains, pulses, sugar, tobacco and tea; and Agricultural Sales Cooperative Unions (ASCUs) responsible for horticultural crops, cotton, oilseeds, nuts, and olive oil. Support prices were announced after planting, and farmers received payment a year or more after harvest and delivery. These bodies also maintained stocks, executed exports, issued export licenses and distributed input subsidies.

After 2000, the country embarked on a process of structural reform as a condition for receiving macro- economic stabilisation assistance from the IMF and World Bank. These reforms were carried out between 2001 and 2008 through the Agricultural Reform Implementation Project (ARIP). ARIP was intended to improve efficiency in the agri-food sector by removing market distortions, and to contribute to fiscal consolidation. Under ARIP, Turkish agricultural policy was oriented towards closer alignment with the European Union’s Common Agricultural Policy.

Reforms after 2001 reduced the State’s role in setting prices, marketing, and trade of agri-food products. SEEs and producer co-operatives were made independent to varying degrees and at different speeds, and became more exposed to market conditions. Structural adjustment in agriculture was promoted through aid to convert land to alternative production, or land consolidation, and with transition support and aid for rural development. This period also saw a shift away from output and input subsidies towards direct income support payments, although high border protection for agri-food products remained in place.

The first national Rural Development Strategy for 2007-2013 was adopted in 2006 as the basis of the EU Instrument for Pre-Accession Assistance Rural Development (IPARD-I). Within the framework of IPARD-I EUR 1.045 billion (USD 1.28 billion) was paid to the beneficiaries. The IPARD-I was implemented in 42 provinces and resulted in approximately EUR 2.3 billion (USD 2.81 billion) investment in 10 653 projects. The National Rural Development Strategy for 2014-2020 covering the IPARD-II period was adopted in 2014. Türkiye launched the implementation of IPARD-II (2014-2020) with a budget of EUR 1.04 billion (USD 1.27 billion).

Since 2010, production-linked payments were re-established for many products. Current agricultural policies also include import tariffs, fixed purchasing prices, deficiency payments (income support payments), insurance support, area-based payments and interest concessions. In addition, there is an emphasis on infrastructure, particularly for irrigation, also connected to rural development objectives.

In accordance with the Nairobi Ministerial Decision on Export Competition, Türkiye eliminated the export subsidy entitlements for agriculture products or groups of products as of the end of 2022.

Table 26.2. Türkiye: Agricultural policy trends

Period	Broader framework	Changes in agricultural policies
Prior to 1980s	Closed economy (import substitution regime)	High tariffs for border protection Agricultural price controls Input subsidies Import controls by the State Economic Enterprises (SEE) which controlled agricultural marketing and production Agricultural Sales Co-operatives Unions (ASCU) and agricultural member cooperatives (ASC) Agricultural Credit Cooperatives State-owned Agricultural Bank
1980-2010	Gradual reform to liberalise trade but with agricultural protection	Agricultural Reform Implementation Project (ARIP) as a precondition of the World Bank and IMF programmes Privatisation of some SEEs and restructuring of ASCUs Price-fixing by government discontinued for some products but remains for others Gradual reduction of tariffs for some agricultural inputs and outputs Progressively reduced role for ASCUs and ASC Price controls continued Product and input subsidies phased out Introduction of Direct Income Support Compensatory payments to cover the cost of switching from crops in excess supply (e.g. hazelnuts and tobacco) to alternative activities (net imported products) Introduction of agri-environmental policies and cadastral works FTAs signed
2010-present	Open market economy but with some agricultural protection	Agricultural tariffs continue to be used Export subsidies (up to the end of 2022) Deficiency payments differentiated according to 945 agricultural basins throughout the country Infrastructure investments increased

The PSE has been declining steadily as a percentage of gross farm receipts since the late 1990s, and now is at historic lows. Exchange rate movements and domestic inflation have affected nominal rates of support, but the policy situation is stable when expressed as a share of gross farm receipts (Figure 26.4).

Budgetary payments have grown in importance, starting with the move towards decoupled payments in the early 2000s, and remained significant through successive reforms that changed their basis. Budgetary support jumped in 2020 due to exceptional spending related to COVID-19, mainly for concessional loans and interest concessions, but levels have since returned to the historical trend.

Figure 26.4. Türkiye: Level and PSE composition by support categories, 1986 to 2022

Notes: A/An/R/I:Area planted/Animal numbers/Receipts/Income.

Payments not requiring production include Payments based on non-current A/An/R/I (production not required) and Payment based on non-commodity criteria. Other payments include Payments based on non-current A/An/R/I (production required) and Miscellaneous payments.

Source: OECD (2023), “Producer and Consumer Support Estimates”, OECD Agriculture statistics (database), http://dx.doi.org/10.1787/agr-pcse-data-en.

Main policy instruments

The majority of support comes through market price support, consisting mainly of tariffs on imported products, though depreciation of the Turkish Lira related to domestic inflation has reduced the prominence of this form of support. Budgetary support comes through price-stabilising (deficiency) payments and area-based payments linked to production characteristics. Purchases of inputs and marketing of major commodities is handled through the state enterprises and collective marketing boards (SEEs and ACSUs), which have price-setting power. Due to market conditions, there have been no purchases of inputs by SEEs in 2022. Irrigation infrastructure is the main target of general support to the sector.

Until the end of 2022, export subsidies applied to 14 commodity groups, out of the 19 groups eligible under Türkiye’s WTO commitments. These included processed fruit and vegetables, poultry meat and eggs. Export subsidies were granted in the form of reductions of the exporters’ debts to public corporations (for example, for taxes, and telecommunications or energy costs). Under the Nairobi agreement, these export subsidies were phased out at the end of 2022. Production quotas apply at the farm level for sugar beet.

The Basin-Based Support Model (Havza Bazlı Destekleme Modeli) targets self-sufficiency in strategic agricultural products and planned agricultural production. Agricultural areas are divided into 945 basins, each identified with a set of strategic products that receives support in that basin. Deficiency payments are set to raise the price of specific commodities to encourage a certain pattern of production according to the government’s evaluation of environmental sustainability and economic suitability. R&D is targeted to increase the yield and quality of local varieties. Basin- and product-based fertilisation and chemical pesticide guides and plant-based water consumption guides are in place.

Some area-based payments directly come in support of specific commodities, as it is the case for instance of hazelnut plantations. Some other payments are more oriented towards farming practices such as using certified seeds or cultivating fodder crops. Farmers can also receive area payments for using certified saplings, organic farming, using good agricultural practices and for the rehabilitation of olive groves.

State-supported agricultural insurance (TARSİM) comes through a public-private partnership where private insurance companies deliver uniform policies to farmers. The state pays between 50% and 67% of the total insurance premium on behalf of farmers.

Water management and irrigation

In the context of water management policy, Türkiye applies the EU Water Framework Directive, which calls for River Basin Management Plans (RBMPs). These have been implemented for the 25 basins in Türkiye by Basin Management Committees with the support of Water Management Coordination Committee and Basin Management Central Committee working at national level. Water Management Coordination Boards, Basin Committees (operating at basin level) and Provincial Water Management Coordination Boards (operating at local level) develop strategies and plans to ensure inter-sectoral co-ordination and co-operation, to adopt an Integrated Water Resources Management (IWRM) approach, to achieve national targets and to fulfil international commitments.

To take a more participatory and holistic approach to managing water resources, a basin-based management target has been adopted. This reflects a “planning-implementation-monitoring-supervision” system. Several regulations have been issued to support this reform, and the legislative infrastructure continues to be established. In this vein, “River Basin Protection Plans” for 25 river basins have been completed. Out of 25 river basins, the River Basin Management Plan in 11 basins and the Sectoral Water Allocation Plan in 7 basins have been completed. All River Basin Management and Sectoral Water Allocation Plans are expected to be completed by 2028. Studies to determine the effects of climate change on water resources and the effects of climate change on snowmelt and currents have been completed, and the preparation process of flood and drought management plans is being carried out.

Sectoral Water Allocation Plans (SWAPs) are being prepared to manage water resources on a basin and sub-basin basis. These will be followed up annually. These plans are designed to preserve water resources, to ensure fair and balanced water distribution among the water user sectors, and to maximise the benefit to be obtained from water use.

Infrastructure investments in irrigation continue to be a major policy focus. Investments support adoption of advanced technology and modern irrigation systems. This includes pressurised piped irrigation systems where transmission losses may be reduced by up to 35% for sprinkler irrigation and 65% in drip irrigation compared to the open flow canal irrigation systems.

Within the framework of the “Rural Development Investments Support Program”, up to 50% grant support is available for the installation of irrigation systems (drip or sprinkler). Approximately 330 000 producers were supported by such grants and credit support, and pressurised irrigation systems were installed on a total area of 1.12 million hectares by the end of 2021. Since 2003, the use of closed system irrigation projects has been accelerated to reduce loss and leakage. By 2022, 32% of irrigated area used piped irrigation networks, compared to 6% in 2003.

The “Regulation on Controlling Water Use in Irrigation Systems and Reducing Water Losses”, in place since 2017, calls for measures be taken to increase irrigation efficiency to 55% by 2024. This regulation sets out the procedures and principles regarding efficient use of irrigation water in irrigation systems, saving water, reducing losses and preventing unauthorised use, and reducing irrigation water supply, distribution and usage costs.

Climate change mitigation

In the food and agriculture sector, the Strategic Plan of the Ministry of Agriculture and Forestry (2019-2023), the National Climate Change Action Plan (2012-2023) and the Research Master Plan (2021-2025) of the General Directorate of Agricultural Research and Policies (GDARP) specifically support research and innovation for net-zero carbon ambitions. Within the scope of the National Climate Change Action Plan and in accordance with the targets in the title of Agriculture and Food Supply, research is being undertaken to provide data for the greenhouse gas inventory of Türkiye and to measure and monitor the greenhouse gases released into the atmosphere by agricultural activities.

Research on greenhouse gas emissions from animal production and fertiliser management is also undertaken as part of GDARP to determine the greenhouse gas emissions from enteric and fertiliser-based animal production systems. Studies are continuing for cattle, sheep, goat and chicken production in order to determine the T-2 model of emission factors (EF) recommended by the IPCC (2019) that reflect national conditions. Additionally, to provide information and data for Land Use, Land Use Change and Forestry Sector (LULUCF), a pilot research study in 2022 focussed on determining and modelling soil organic carbon under different land use categories.

Climate change adaptation policies in agriculture

Türkiye adopted the Green Deal Action Plan in 2021 with targets and actions to increase the sustainability of agriculture. The Action Plan’s “Sustainable Agriculture” and “Tackling Climate Change” headings include actions such as reductions in the use of pesticides, anti-microbials, and chemical fertilisers; developing organic production; increasing renewable energy use in agriculture; reducing food loss; and sustainable water use and reuse of wastewater. Developments for the year 2022 are reflected in the Yearly Report on the Green Deal Action Plan.1

Presidential Circular No. 2022/8 on the Ecosystem-Based Adaptation Strategy to Climate Change for Anatolian Steppe Ecosystems was published on 7 July 2022. Implementation of the strategy brings an integrated approach to climate change in the management of agricultural, pasture, wetland, and forest areas in agricultural production. The strategy will help the government improve understanding of this approach in the Anatolian Steppes. Its objectives include:

• creating resilience in the ecosystems affected and to-be-affected by climate change

• making the agricultural economy and rural population resilient to climate change

• integrating ecosystem-based adaptation studies with policy, planning, and decision mechanisms to support climate-change adaptation strategies

• developing a governance model in partnership with stakeholders

The 2023-27 Strategy and Action Plan for Combating Agricultural Drought (Türkiye tarimsal kuraklikla mücadele stratejisi ve eylem plani) was announced in 2022. The action plan is designed to minimise the effects of drought by increasing public awareness, involving all stakeholders in the process, planning sustainable agricultural water use, taking necessary measures during periods when drought does not occur, and implementing an effective combat programme during crisis periods. Priority will go to drought-combatting activities that complement those to combat other disasters affecting the agricultural sector. The issue will be handled with a holistic approach in economic, social, and environmental terms.

Actions taken under the plan are carried out based on drought severity according to defined thresholds. These are: (1) pre-drought processes; (2) risk-assessment and management; and (3) crisis-assessment and management. Provincial Drought Action Plans will be prepared based on these threshold levels. The main activities foreseen are:

• drought risk-prediction and crisis-management

• ensuring sustainable water supply

  • increasing storage capacity

  • improving infrastructure

  • collecting and reusing wastewater

  • managing groundwater

  • water-conserving land-use techniques

  • integrated water management

• managing water demand

  • improved transmission systems for irrigation

  • using groundwater effectively

  • incentive programmes

  • accounting for drought in crop and livestock production policies

  • expanding greenhouse production

• accelerating R&D and increasing extension and training

• improving institutional capacity

The General Directorate of Agricultural Research and Policies co-ordinates research on climate-friendly agriculture and the economical and sustainable use of soil and water resources. To set priorities for adaptation work, a research project is looking at farmers’ and producers’ awareness of changing climatic conditions and their resilience to climate change. This was initially in the Thrace and Aegean Regions where agriculture is intense, but has expanded to all regions and continues as a national programme. A guide using the results of this research will be published to assist farmers in adapting to changing climate conditions.

Domestic policy developments in 2022-23

Production planning, insurance and assistance

Production planning is increasingly seen by the government of Türkiye as a tool to address issues such as climate change, the pandemic process and the increase in food demand. Main priorities are to use natural resources in an effective, efficient and sustainable manner, to increase production, quality and trade, to ensure security of supply, to stabilise the income of producers, to protect public health and consumer interests, to increase the competitiveness of the agriculture, food and forestry sector, and to take necessary measures against climate change and its impacts.

For this purpose, the Department of Security of Supply was established in 2022 to follow national and international developments, analyse the adequacy process of production and develop measures for security of supply in strategic agricultural products. With the Supply Security Monitoring System to be established within this scope, data collection, analysis, monitoring and decision support services in digital environment will be improved to support efforts to ensure supply security in agricultural products.

Additional efforts were made in 2022 by the Ministry to advance the digital transformation of programme delivery. The “Tarim Cebimde” mobile application was deployed, and producers have been provided with access to the Farmer Registration System (ÇKS) applications and product notifications via the e‑government gate as of October 2022.

The scope of agricultural insurance was expanded in 2022 with the introduction of revenue protection insurance. Producers affected by natural disasters are eligible for additional support and grants. Revenue Protection Insurance covers 70% of insured farmer revenue against yield losses and price variations. In 2022, 3 million insurance policies were issued and TRY 4.8 billion (USD 289 million) of state insurance premium support was provided.2 Revenue protection insurance was first piloted in the three districts of Konya in 2021-22. As of October 2022 it is available in all districts of Konya. It will be available to all producers across Türkiye as of October 2023.

The national action plan on Prevention, Reduction and Monitoring of Food Loss and Waste, established in 2020, continues to advance in its implementation, with 70% of planned actions completed and 881 000 pledges made by consumers to reduce food waste. Five guidelines were published on logistics, food service sector, food retail sector, composting and consumers. As raising awareness activities are still ongoing, focus on children is continuing with the help of FAO’s “Do Good Save Food” educational materials translated to Turkish.

Domestic consumer price inflation in Türkiye reached 80% in 2022, and agricultural policies have adjusted in some ways for this. For example, announced purchase prices for sugar beet, considered a strategic commodity, were increased by 245% to TRY 1 450 (USD 88) per tonne.

The amount of support to be paid to farmers registered in the Farmer Registration System (ÇKS) and located in areas where planting is prohibited due to “potato wart” disease has been increased to TRY 1 250 (USD 75) per ha from TRY 1 100 (USD 124 at 2021 exchange rates) previously. Farmers are eligible for the payment if they grow alternative crops or leave fields fallow in areas where the disease is present.

Delivery of diesel and fertiliser supports as of 2022 are now delivered via a card issued by the Ziraat bank that may only be used for the purchase of diesel and fertiliser. This replaces the previous cash-based system for this per-hectare payment. Interest-reduced agricultural credits through Ziraat Bank and Agricultural Credit Cooperative have also been modified. Farmers can get zero-interest credit loans from the Ziraat Bank for traditional (widespread) crop production up to TRY 200 000 (USD 12 077), but if a farmer borrows more than TRY 100 000 (USD 6 038) they must use the additional amount only for the purchase of diesel or fertiliser.

Water management and irrigation

A pilot project was established for the use of solar power for irrigation in the Samsat district of the Adiyaman province. A solar power plant was constructed to power the pumped irrigation infrastructure in that district. This is in accordance with Türkiye’s strategy of “Reducing Foreign Dependence on Energy and Increasing the Ratio of Renewable Energy Sources in Energy Distribution”. Also, irrigation unions and agricultural producers have been given the opportunity to use loans with an upper limit of TRY 7.5 million (USD 453 000) for solar energy investments with an interest rate discount of up to 100%.

Investigating the Use of Marginal Water in Agricultural Irrigation and Determining its Contribution to the Circular Economy (MARSUDE) was launched in five different provinces in 2022. This programme has the aim of contributing to the use of low-quality water in irrigation by investigating the possibilities and conditions of using reclaimed water in agriculture.

Rural development

Externally funded rural development projects in rural disadvantaged areas were accelerated and support to small family enterprises and income generating activities was increased. Grants and support were provided through the Programme for Supporting Rural Development Investments (KKYDP), the European Union Rural Development Programme (IPARD), the Project for Support and On-Site Development of Forest Villages (ORKÖY), and Expert Hands in Rural Development Projects.

Support for economic investments targeting agriculture within the scope of rural development support and rural economic infrastructure investments was increased in 2022. For support for “Economic Investments in Agriculture”, the upper limits of the eligible project were increased from TRY 5 million (USD 564 000 at 2021 exchange rate) to TRY 7 million (USD 423 000) for new applications. The amounts have been increased from TRY 3.5 million (USD 395 000 at 2021 exchange rate) to TRY 5 million (USD 302 000) for applications that complete existing projects and from TRY 3 million (USD 338 000 at 2021 exchange rate) to TRY 4 million (USD 241 000) for applications related to capacity, technology renewal or modernisation. The upper limit of support for rural economic infrastructure investments has been increased from TRY 300 000 (USD 34 000 at 2021 exchange rates) to TRY 500 000 (USD 30 193), excluding VAT, for applications for machinery and equipment purchases.

In addition, the “Implementation Principles of the Rural Development Investment Support Program for the 2022-2023 Application Period” were amended to include small family businesses engaged in animal production. Enterprises with 5 to 50 cattle or 50 to 300 sheep or goats will be eligible for 50% grant support for the purchase of feed preparation machines, manure scrapers, milking machines, milk cooling tanks, animal scratch brushes, drinkers, air conditioning and ventilation systems, and electricity generation systems up to 5 kW for transhumance and nomads.

The Financial Framework Partnership Agreement with the European Union, which constitutes the legal infrastructure of support within the scope of the third period of the instrument for pre-accession assistance covering the years 2021-27 (IPA III), entered into force on 14 December 2022. Part of this is the instrument for pre-accession assistance for rural development (IPARD). The implementation of the IPARD III period began in 2023. The EU IPARD funds allocated to develop the capacity for compliance and implementation of the EU acquis in Türkiye and create the capacities for economic and social cohesion cover five components: transition period support and institutional structuring, cross-border co-operation, regional development, human resources development and rural development.

Trade policy developments in 2022-23

In accordance with the Nairobi Ministerial Decision on Export Competition, Türkiye eliminated the export subsidy entitlements for agriculture products or groups of products as of the end of 2022.

The average rate of customs duties applied in 2022 for basic agricultural products outside the Customs Union Common External Tariff was 58%.3

In 2022, a revised free trade agreement (FTA) with Montenegro and amendment of the FTA with Morocco came into force. The ratification processes of the FTA with Ukraine, and the United Arab Emirates; and revised FTAs with Georgia and Malaysia are continuing. The Preferential Trade Agreement (PTA) with Pakistan has entered into force on 1 May 2023 and the PTA with Uzbekistan (signed in 2022) on 1 July 2023. An Additional Protocol to extend the scope of the current concessions under the PTA with Azerbaijan was signed on 14 April 2023. FTA negotiations are actively ongoing with three countries: Japan, Thailand, and Indonesia.

Trade policy responses to Russia’s war of aggression in Ukraine

In July 2022, Türkiye, the UN, Russia, and Ukraine signed an agreement in Istanbul to resume grain exports from three Ukrainian Black Sea ports, which were paused after the Russian invasion of Ukraine in February 2022. A Joint Coordination Center with officials from the three countries and the UN was set up in Istanbul to oversee the shipments.

The Decision on the “Principles to be Applied in the Import of Agricultural Products from Ukraine” (Decision Number 5251) was published on 3 March 2022. This introduces exceptions to official controls in the import or transit of agricultural products in order to ensure food supply security and to avoid problems in accessing food products. The regulations introduced by the decision are as follows:

• Official certificates and documents, which are required to be submitted to the Ministry of Agriculture and Forestry within the scope of the Law No. 5996 on Veterinary Services, Plant Health, Food and Feed, in the import or transit trade of agricultural products loaded from Ukraine, will not be required under certain circumstances.

• The frequency of official controls by the Ministry will be determined based on risk analysis.

• The Ministry’s General Directorate of Food and Control is authorised to make decisions in terms of special situations that may arise.

The export of some agricultural and food products was temporarily banned or limited in certain cases due to the war to ensure domestic supplies. Since February 2022, Türkiye has applied an export ban to more than a dozen agricultural products, including vegetable oils, meat, pulses, and some dairy products. On 26 June 2022, the ban on butter exports was replaced with a monthly quota, and on 7 July the ban on olive oil exports was removed. Export controls of most vegetable oils were lifted in August 2022.

Duty rate adjustments first put in place in response to the COVID-19 pandemic have been continued to ensure food supply security and prevent price fluctuations. Pursuant to the decision published in the Official Gazette on 31 December 2022, duty rates of 0% apply until 30 April 2023 for wheat, barley, oat, rye, sorghum and corn and until 30 June 2023 for chickpeas, lentils and dry beans. These duty rates had been 45% for wheat, 35% for barley, 25% for maize, 130% for oats, rye and sorghum and 19.3% for chickpeas, lentil and dry beans. As of 1 May 2023, customs duties for wheat, corn, barley, rye, sorghum and oats were increased to 130%. Until 31 May 2023, the duty rate was reduced from 10% to 0% in the import of crude sunflower seed oil and from 5% to 0% in the import of sunflower seeds. As of 1 June 2023 customs duties for these products were increased to 36% and 27% respectively.

Contextual information

Türkiye has the 11^th largest economy in the world as measured by GDP in PPP. Per capita GDP has tripled since 2000 and is above average for the countries included in this report. Türkiye has a large agriculture sector that employed 17% of the country's working population and accounted for 5.5% of GDP in 2021. Türkiye is a net exporter of agro-food products, which accounted for 10.8% of all exports (Table 26.3).

Table 26.3. Türkiye: Contextual indicators

	Türkiye		International comparison
	2000*	2021*	2000*	2021*
Economic context			Share in total of all countries
GDP (billion USD in PPPs)	609	2 581	1.5%	2.1%
Population (million)	64	84	1.5%	1.6%
Land area (thousand km2)	770	770	0.9%	0.9%
Agricultural area (AA) (thousand ha)	40 479	37 762	1.3%	1.3%
			All countries1
Population density (inhabitants/km2)	83	110	52	64
GDP per capita (USD in PPPs)	9 476	30 672	9 350	23 401
Trade as % of GDP	14.9	30.4	12.3	15.6
Agriculture in the economy			All countries1
Agriculture in GDP (%)	10.0	5.5	2.9	3.9
Agriculture share in employment (%)	36.0	17.2	-	-
Agro-food exports (% of total exports)	13.3	10.8	6.2	7.9
Agro-food imports (% of total imports)	5.9	7.5	5.5	7.2
Characteristics of the agricultural sector			All countries1
Crop in total agricultural production (%)	57	58	-	-
Livestock in total agricultural production (%)	43	42	-	-
Share of arable land in AA (%)	59	52	32	34

Notes: *or closest available year.

1. Average of all countries covered in this report.

Sources: OECD statistical databases; UN Comtrade; World Bank, WDI and national data.

The economy has recovered fast from the COVID-19 pandemic. However, macroeconomic policies and high commodity prices have contributed to a surge in inflation, which is now above 70% (and higher for many agricultural commodities) (Figure 26.5). Rising food prices triggered by the pandemic and subsequently Russia’s war against Ukraine contributed significantly to overall inflation. The labour market is performing well and GDP growth was strong at around 6% in 2022.

Figure 26.5. Türkiye: Main economic indicators, 2000 to 2022

Sources: OECD statistical databases; World Bank, WDI; and ILO estimates and projections.

Türkiye is a significant agricultural exporter of nuts, dried fruits, and some fresh vegetables; main export destinations include the European Union, Iraq, the Russian Federation and the United States. Türkiye is a major producer of wheat, sugar beets, milk, poultry, cotton, tomatoes and other fruits and vegetables, and is the top producer in the world for apricots and hazelnuts as well as the largest global exporter of quinces and raisins. Agricultural trade has been steadily increasing and Türkiye is a net exporter. Most imports are products destined for further processing, while most exports are products for consumption (Figure 26.6).

Figure 26.6. Türkiye: Agro-food trade

 

Notes: Numbers may not add up to 100 due to rounding.

Source: UN Comtrade Database.

Agricultural growth has been predominantly based on total factor productivity (TFP) growth and increased use of inputs (Figure 26.7). Improved productivity may be connected to increased irrigated area, opening more land to intensive production.

Figure 26.7. Türkiye: Composition of agricultural output growth, 2011-20

Note: Primary factors comprise labour, land and capital (livestock and machinery). Intermediate input comprises materials (feed and fertiliser).

Source: USDA Economic Research Service Agricultural Productivity database.

Agriculture uses about 85% of the freshwater abstracted by all sectors. Water stress is increasing and above the OECD average (Table 26.4). Average precipitation is expected to decline because of climate change, increasing stress on the hydrological system. Nitrogen and phosphorus balances have also been increasing, and phosphorus balance is well above the OECD average due to intensive livestock production. Agriculture represents 4.5% of energy use, below its share of GDP (5.5%), but it accounts for a relatively high share of national GHG emissions (14%).

Table 26.4. Türkiye: Productivity and environmental indicators

	Türkiye		International comparison
	1993-2002	2011-2020	1993-2002	2011-2020
			World
TFP annual growth rate (%)	0.9%	1.6%	1.7%	1.1%
			OECD average
Environmental indicators	2000*	2021*	2000*	2021*
Nitrogen balance, kg/ha	27.8	37.9	32.2	30.4
Phosphorus balance, kg/ha	8.0	9.2	3.3	3.0
Agriculture share of total energy use (%)	5.0	4.5	1.7	2.0
Agriculture share of GHG emissions (%)	14.2	14.0	8.6	10.5
Share of irrigated land in AA (%)	8.0	11.7	-	-
Share of agriculture in water abstractions (%)	75.4	84.7	46.6	49.7
Water stress indicator	18.6	26.1	8.3	7.4

Notes: * or closest available year.

Sources: USDA Economic Research Service, Agricultural Productivity database; OECD statistical databases; FAO database and national data.

Notes

← 1.  https://ticaret.gov.tr/data/643ffd6a13b8767b208ca8e4/YMEP%202022%20Faaliyet%20Raporu.pdf.

← 2.  2022 TRY/USD exchange rate was 16.56, up from 8.86 in 2021. This should be borne in mind when looking at year-on-year changes.

← 3.  The Customs Union with Türkiye has been in force since 1995 and is based on the 1963 Ankara Agreement and its Additional Protocol (1970) https://trade.ec.europa.eu/access-to-markets/en/content/eu-turkiye-customs-union.