Market restructuring and small
farmer exclusion:
the tomato market in Turkey
Céline Bignebat, INRA-Moisa
EAAE Congress
28 August 2008
Motivation of the presentation
• Supermarket development
• Marketing channel restructuring
• Impact on small producers
 Challenging results from Turkey
• Regoverning market report
• Collateral papers
Summary of a collaboration bet. 2 teams
Moisa (INRA Montpellier)
& Adkeniz University (Antalya)
Outline
1)
2)
3)
4)
FFV sector in Turkey
Producer level: adaptation/exclusion
Move along the marketing channel
Conclusion and perspectives
FFV sector in Turkey
• Development of modern retail: intermediate level; however
lower for FFV (20%)
• Consumer demand: share of the budget spent on FFV is more
than 25%; demand for quality; preference for traditional street
markets (pazar, with a large range of varieties, less segmentation
via safety – organic)
• Regulation: the wholesale market law (1995)
 Centralisation of transactions on wholesale markets
(establishment controlled by public authorities); produce is
handled by commissioners remunerated according to total
sales (5-8%)
 Coops as producers unions can bypass commissioners
Questions
• Producer
level:
 Adaptation/exclusion
 If adaptation, do they benefit from modern retail
development
• Marketing
channel level:
 Adaptation/exclusion
 Who gains from modern retail development?
Data
•
Fresh tomato for the domestic market
 Industrial tomato: structure and strategies are not
comparable with fresh; and doesn’t fit to the RM question
 No specific data on exports
•
Two data sets :
 Producers: 212 fresh tomato producers – dec 06-jan 07
(random sampling, stratification: size) (see Map)
 205 wholesale market agents (exhaustive collection) feb 07
 Matched data (no direct sales reported)
 Investigate their behaviour
Producer level
•
RM methodology, comparative view
 Participation stage: is the producer engaged in a modern
marketing channel or not? Definition of modern: indirectly
probably selling to a supermarket (commissioners procure
produce in bulk, no tracability of lots)
 If yes, does it affect the gross income from tomato
production
•
Exogenous variables
 Individual and farm characteristics, land and non land
assets, technical assistance, role of coops
Producer level - results
•
Participation to the modern marketing channel
• is related to individual characteristics (age and experience),
and to farm location
• No impact of land assets, and some non-land assets
(glasshouses-irrigation methods); no impact of getting a loan
(investment)
• Negative effect of coops
• No impact of participation on the income
Producer level – marketing channel
•
Producers don’t know who is the final buyer
Reported by the producers
•
Reported by the commissioner
Yes
No
Yes
57%
43%
No
53%
47%
Intermediation as a key determinant:
 Are the commissioners adapting to the supermarkets’
requirements instead of the producers?
 Investment in specific practices: sorting, grading, large
range of varieties
Wholesale market level – results
•
Who are the commissioners selling to
supermarkets?
 Antalya region (180), 30% of them are selling to
supermarkets, not dedicated, price is higher/requirements too
 Either large or small (niche), not speciliazed in tomato,
exposed to other requiring marketing channel (hotels)
•
Does this relationship imply specific practices?
 Assumption: delayed investment
 But, wholemarket firms that engaged recently with
supermarkets invest more  evolution of business model?
Fear of a modification of the law
What about producer unions?
•
Traditional village cooperatives
 often don’t meet the requirements to be recognized as
producer unions
 don’t aim at marketing (credit supply, network…)
 inheritance from the socialist period
•
But an evolution …
 … towards modern marketing coops (change in the
legislation)
 Members, large producers (exporters)
 The second type should theoretically dominate the
commissioner system
Conclusion and perspectives
• Turkey – intermediate level of the supermarkets growth
• A highly regulated FFV market: a slow market restructuring
• Trends are demonstrating an accelerated mouvement of the
intermediaries (wholesale markets and producer unions)
• Questions the notion of market transition (managment)
• Perspectives
• Have a look at the short term evolution
• Exports are totally absent of the analysis
• Comparison with similar countries (Morroco)
References
“Restructuring of agrifood chains in Turkey. Turkey national, local meso-study and
micro report”, with Koç, A.A.; Bignebat, C, ; Codron, J.M. ; Tekelioglu, Y. ;
Lemeilleur, S. ; Tozanli, S. ; Aksoy, S. ; Demirer, R. , avril 2008
Bignebat, Codron, Lemeilleur, “Delayed adoption of specific practices in uncertain
environments: The case of the fresh fruit and vegetables in Turkey“, ISNIE 2007
Lemeilleur, Bignebat, Codron, “Marketing Cooperative vs. Commission Agent: The
Turkish dilemma on the Modern Fresh Fruit and Vegetables Market”, EAAE 2007
Aksoy, Bignebat, « “Intermediation choice for tomato producers in Turkey: Merchants
vs. Wholesale market agents“, mimeo
Lemeilleur, S. ; Tozanli, S. “A Win-Win Relationship between Producers' Unions and
Supermarket Chains in Turkish Fresh Fruits and Vegetables Sector“, Innovative
practices, Regoverning markets.