04 July 20225 min reading

While the future crises in global access to food, war, climate change, price increases in agricultural commodities, and problems related to logistics were all on the agenda of the grain industry, the industry met in Istanbul.

The congress held by the International Association of Operative Millers (IAOM), which operates in 14 different regions around the world and brings together industry professionals such as grain, flour, pasta, and feed producers, took place in Istanbul. For three days, the effects of the Russia-Ukraine war on the wheat market, its reflections on production, trade, logistics and sub-sectors, and the effects of climate change on agriculture were discussed, and possible solutions were discussed. In the congress, the global effects of the war between Russia and Ukraine, where the first represents 10 percent of the global wheat production and 30 percent of the wheat production of the Eurasian region, and the latter came after it with 25 million tons of production, were among the most significant issues.


Aras Demir, the founder of the umbrella company, Vivalon, and Taban Gıda, underlined in the panel where global trade and investment policies were discussed that new problems were added to the ones experienced with the pandemic. “With the pandemic, companies started to stock up very quickly. This caused prices to skyrocket. After that, when they continued with their stocks, the prices started to decrease. This resulted in fluctuations in the market. Not being able to foresee the future and make long-term plans, companies are continuing to stock up. Since they continue to trade with their own stocks, tonnages began to decrease. I think this was a big blow to our industry,” Demir said.


Aras Demir mentioned that they had problems with logistics due to the pandemic and the Russia-Ukraine war. "We had severe problems in terms of logistics, especially in this period. As Vivalon, we used a certain portion of our capital to purchase ships. This challenging period has demonstrated that we made the right move. Last year we bought two ships and this year we bought another. After the war broke out, we started to have problems in financing. The withdrawal of the financing banks from the market made things even more difficult for us. That's why we started using our capital. It is quite challenging to just stand at one point and manage the trade. We want to be present in every link of the supply chain. As Vivalon and Taban Gıda, we will continue to support all relevant industries in our country with all the means we can, with new instruments, investments in production, financing, and logistics,” Demir said.


Hasan Hacıhaliloğlu, CEO of Taban Gıda, which has strong commercial relations with Russia and Ukraine, carries out transit trade to approximately 20 countries across 5 continents and is the leader of the wheat supply market in Turkey, made a speech at the panel where the grain and milling industries were discussed. “With the increasing world population, the need is also increasing. We need to use all our opportunities to meet these needs. We can solve this by digitalization in agriculture. We need to take more planned and stronger steps in this area. With smart farming practices, Turkey's soils will see the best point in productivity. The most profitable crop will be planted in the most suitable region. If the right crop is duly planted on the right land, the supply-demand balance and therefore the right price will be formed. With digitalization, agricultural lands will be used more effectively and production will meet the needs. In this way, agricultural commodity productivity will increase. With sustainable agriculture, we will leave healthier lands to future generations. This is one of our biggest responsibilities towards the future,” Hasan Hacıhaliloğlu said.

“As you know, Turkey has been the champion of flour export for many years. Despite all the difficulties, Turkish flour industrialists have managed to keep the country at the top in flour exports. Turkey imports around 10 million tons of wheat every year, and most of it is for exports of flour and finished products. And we, as Taban Gıda, undertake most of this import. Rising costs and unpredictable markets are our biggest problems. Predicting the market is crucial to us. The recent crises have made production and trade even more difficult,” Hacıhaliloğlu went on.

In his speech, Hacıhaliloğlu talked about the importance of investments in logistics regarding the flour trade. “One of the necessary steps in the flour industry is to invest in logistics. I think leading companies in this industry will be able to carry Turkey's leadership in exports to much better places by gradually investing in maritime transportation. The rising costs in maritime transportation seem to be one of the most important problems for a while. We are trying to turn this into an advantage, at least to make it predictable, with the ship purchases of our umbrella company Vivalon in our sector,” he concluded.

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