Cablegate: Adana Company Blazes Trail for Turkish Organic Food

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Dianne Wampler 01/04/2007 08:35:05 PM From DB/Inbox: Dianne Wampler

Cable
Text:

UNCLAS ADANA 00268

SIPDIS
CX:
ACTION: ECON
INFO: CONS PA RAO FAS MGT PMA FCS POL DCM AMB

DISSEMINATION: ECON /1
CHARGE: PROG

VZCZCAYO136
RR RUEHAK
DE RUEHDA #0268 3620952
ZNR UUUUU ZZH
R 280952Z DEC 06
FM AMCONSUL ADANA
TO RUEHC/SECSTATE WASHDC 4402
INFO RUEHAK/AMEMBASSY ANKARA 0948
RUEHIT/AMCONSUL ISTANBUL 0817
RUEHRC/USDA FAS WASHDC
RUEHDA/AMCONSUL ADANA 1004

UNCLAS ADANA 000268

SIPDIS

E.O. 12958: N/A
TAGS: ECON ETRD
SUBJECT: ADANA COMPANY BLAZES TRAIL FOR TURKISH ORGANIC FOOD
EXPORTERS

Summary
-----------

1. (U) Despite reduced demand this year for Turkish citrus, one
Adana-based company has successfully entered the European
organic foods market with produce from farms in the region. Pan
Tarim's director, Zeynep Oztekin, cited two main challenges:
convincing local growers to endure the difficulties of
transitioning to chemical-free farming and managing the
extensive auditing that is required for produce to be labeled
organic. She anticipates further growth in Europe, but believes
the more mature U.S. market will be harder to enter. Though
organics are not a panacea, Oztekin's success shows there is a
place for Turkey in the growing market for high value-added
agricultural products. End summary.

A First for Turkey
---------------------

2. (U) She told us that Pan Tarim is a pioneer in Turkey to
specialize in growing, packing, and exporting organic produce,
primarily tomatoes and citrus. Her company, Pan Tarim, was the
first in Turkey to have its produce certified as organic by the
Institute for Markey Ecology, a gate-keeper for European organic
food sellers.

3. (U) Oztekin explained that securing certification from the
IMO requires growers to demonstrate they have been operating
without chemicals for at least two years. In addition, the
produce must pass through subsequent links in the supply chain -
harvesting, storage and shipping - without exposure to
chemicals. Finally, organics require "traceability" from the
seed to the market shelf as well as stringent labeling and
worker safety requirements. As a consequence, Oztekin has a far
more intense relationship with her growers than other exporters
would have. She noted that this lengthy audit process demands
accurate record-keeping and technology-intensive information
management. To improve efficiency, Pan Tarim is opening a
packing house in February 2007 in the Adana Organized Industrial
Zone. Despite the administrative challenges, the rewards are
high: currently, the farm price for organic citrus is about
double that for conventionally grown fruit.

4. (U) One of Pan's early success stories was achieved by
working with growers from an Armenian village, Vakifli, in the
Samandag District of Hatay. Because the village had
traditionally never used fertilizers or pesticides, they were
able to gain organic certification without the usual transition
period. In cooperation with Oztekin, the villagers established
a cooperative and their organic broke the Spanish monopoly in
the UK market by exporting to Tesco, and Sainsbury. As a
result, the village was awarded "the Exporter of the Year" by
Turkish Exporters Assembly (TIM) in 2004.

Plenty of Room for Growth
---------------------------------

5. (U) The market for Turkish organics is almost exclusively in
Europe. Pan's largest customers are the UK-based Tesco and
Sainsbury's supermarkets. Her produce is also sold in Carrefour
markets in France - but not in Carrefour's Adana store. The
organic market in Europe is growing by about 20-30% annually and
the global trade volume is expected to increase from $25 billion
to $100 billion the next five years. This year, Pan Tarim plans
to double its citrus exports to 4,000 tons. Oztekin is also
applying for organic certification from the USDA, which will
open up the American market as well. Based on a visit she made
to the U.S. under the Cochran Fellowship, Oztekin concluded that
the technical requirements for organics in the U.S. are easier
to achieve, but the sophisticated distribution and marketing
systems of American food companies make the market very
competitive. Other markets include Korea, which imports "black"
carrots, and may buy nuts and other produce as well.

GREEN

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