Market players weigh effects as Turkey lifts wheat import restrictions

Turkey has officially allowed free wheat imports from international markets, easing its prior import quota restrictions. The quota previously allowed importers to fulfill 75% of their purchases through state agency TMO's stocks before accessing the remaining 25% from global markets.

"Bread wheat sales carried out by TMO in the scope of manufactured goods export have been terminated," according to a letter sent to millers from the Turkish Flour Millers Federation as seen by Platts March 19.

"Based on the information received from TMO Domestic Trade Branch Directorate, wheat imports have been opened as 100% in the scope of the Inward Processing Regime," the letter said.

A local source said this announcement likely stemmed from industry lobbying pressure, coupled with an intent for Turkey to regain ground in the flour export market.

"Millers lost serious share in flour exports to Egyptian and Ukrainian millers," the source added.

A buyer said monthly flour export volumes have halved to around 150,000 mt compared with a year ago, so "supporting 100% imports may improve this."

Citing a need to protect domestic production, Turkey suspended wheat imports starting June 21, then introduced a series of import quota measures starting Oct. 15. Turkey's flour exports fell 41% after the series of measures, with 1.44 million mt of flour from July 2024 to January 2025 compared with 2.45 million mt the year before.

Traders pointed to ongoing drought concerns potentially impacting the harvest that starts in June as another possible reason for removing the quota; now TMO "is unsure about the harvest due to the weather," one local source said.

With higher import potential, market participants expect that demand will focus on higher protein despite Russian 12.5% typically being the preferred origin and content.

A Turkish source said this move is unlikely to significantly increase demand for Russian 12.5% due to already sufficient stocks of local and imported products, and "demand mostly will remain focused on higher protein."

A Russian seller said, "Russian high protein 14%-15% will work great for Turkey," and that this would mean "Russian exporters will have more variety to sell." Turkey bought 2.28 million mt of wheat from Russia in the July-January period, down 1.9 million mt from the same time last year.

Market participants said prices will move up in accordance with higher freight rates. A local buyer said that prior to the policy change, "expectations of the market were at $250/mt to buy." Another said, "I do not see any bids for now, but I am sure when millers are ready, they will bid up."

1 million mt corn import quota set at 5% duty

Turkey has introduced a new import quota for 1 million mt of feed corn with a reduced 5% tariff until June 30, the country's trade ministry said March 19. However, the new regulation limits shipment volume, allowing importers to bring in no more than 8,000 mt per transaction. After that, they must wait seven days before submitting the next application.

This measure is intended to regulate the pace of imports, according to Turkish traders.

The Turkish government reduced the import tariff from 130% to 5% for 1 million mt of corn in October. Taking full advantage of this, Turkish buyers increased corn imports from Ukraine during October-December, after which the tariffs reverted to 130% to stabilize domestic prices.

Traders expected the imminent introduction of a fresh corn import quota long before its announcement and rushed to secure Ukrainian cargoes in February, Platts reported earlier.

European traders said the government's move would create new demand for corn, as Turkey has been absent for months. Supplies are especially expected to be sourced from the Black Sea region, including Ukraine and Romania.

Mixed views about possible demand increase

Meanwhile, Turkish market participants have mixed views about an increase in demand.

An Istanbul-based trader said the new regulation has a discount effect on the Turkish local market.

"Turkey's main import market is Ukraine, and Ukraine's prices are $252/mt CIF Marmara basis nowadays," the trader said. "With the new quota and 5% tariff, traders don't need to use inward processing licenses and pay an import tax of around $12."

Another Turkish trade source said: "I believe demand for coasters will stay high. Most importers will discharge into bonded warehouses and wait without customs clearance."

Some sources said they believed that limited shipment volume and the seven-day wait rule would slow imports.

A Turkish broker said bonded warehouses were already full, meaning buyers will likely use existing stocks before turning to new imports.

Platts assessed FOB Ukraine corn up $5/mt on the week to $238/mt March 19 for loading in the second half of April.