CRITICAL TURNING POINT FOR TURKEY IN AGRICULTURE

CRITICAL TURNING POINT FOR TURKEY IN AGRICULTURE

Countries' policies on food supply require rational and continuous planning. Therefore, agricultural policies are of strategic importance for countries. As the population increases, the planning of agricultural production also gains importance. Looking at the value chains of agricultural products in the world, it is seen that production processes develop with the dependence of producers. This dependency is tried to be made sustainable for the producers to continue production. If the production chain breaks, this is a disaster scenario for agricultural policies.

One of the most important problems in agricultural products that national legislation of all countries try to regulate is market access. Market access of small producers, who are the insurance of the system, completes the trade cycle and ensures the continuity of production. For this reason, keeping the terms of trade in agriculture at levels that encourage production constitutes the basis of agricultural policy. In other words, when the producer is able to sell the product, he/she should be able to cover the inputs for reproduction and make a profit sufficient to ensure his/her livelihood so that he/she can continue production. Therefore, small producers should be protected.

The recent increase in food prices in Turkey continues to attract the attention of economists. While food prices are decreasing in the world, they continue to increase in Turkey, raising questions about the correctness of the preferences in agricultural policies. One dimension of the issue is the increase in consumption and therefore demand due to the "refugee problem" Turkey is facing. However, economic systems operate with complex system dynamics and are largely non-linear. Therefore, trying to explain the rise in food prices with a single factor is bound to be incomplete. Here, I will try to address an important dimension of the multidimensional food inflation problem: producers' access to the market and their withdrawal from production.

The most important and perhaps the most dangerous reason for the rise in food inflation in Turkey is the breakdown of the production chain. The problem of producers' access to the market leads them to withdraw from production, which in turn leads to a supply-driven increase in food prices. The problem of market access manifests itself when the producer is unable to sell his/her product and is unable to bear the costs for reproduction. This is a critical threshold at which agricultural policies begin to fail. Attempting to cover the supply deficit caused by insufficient production with imports means ending production to the extent that it will never recover.

The fact that the increase in imports, especially in meat products, has not slowed down can be seen as the result of faulty choices. The plundering of pasture lands with the transformation of villages into neighbourhoods and the increase in feed and medicine costs are the conditions that put pressure on producers. Producers are excluded from the production process as prices, which become cheaper with imports, damage the terms of trade. The resulting supply deficit forces more imports and a vicious cycle of non-production begins. When production decreases, the inevitable result is a decrease in national income.

Exploiting its position as the market regulator in milk, the government has completely destroyed small producers in dairy products and caused dairy cows to be sent to slaughter. The animal population required for reproduction requires a very long time and production is no longer profitable. The effects of the break in the production chain in milk and dairy products are manifested in astronomical increases in the prices of these products. The decline in the animal population also leads to high price increases in the meat sector in the medium term. Once again, the justification for imports emerges. The moral dimension of the problem is the proximity of the importing companies to the government.

The situation is slightly different in the fruit and vegetable sector. Unless vegetable and fruit producers are vertically integrated large-scale companies, their access to the market is completely under the control of traders. Producers are often forced to sell their produce very cheaply in the field or in the tree. The trader supplies the product to the market at very high prices. The companies in the market usually buy the product from the producer without paying any money, deduct their costs and profits after selling it, and give the remaining money to the producer. This money is far from covering the costs of the producer. The producer is excluded from production and large-scale agricultural enterprises are able to control the market completely.

There are also interesting stories among the examples. A producer who sells the produce in his field to a company in the market may be shocked by the company's debt to him while waiting for money. These examples can also be the subject of newspaper articles from time to time. It does not seem that the problem can be solved completely through co-operatives. All components of agricultural policy need to be reconsidered in line with the needs based on reason and science. When regulations are made to benefit certain groups, the exclusion of producers from production inevitably takes place.

Increases in input costs such as pesticides, fertilisers and seeds, as well as increases in fuel prices, make small producers unable to access the market and feed the producer to the traders. There are two possible solutions to this problem. The state incentivising producers to support production and regulating wild trade are effective solutions. The "Amendment of the Law on Hal", which has been on the agenda in every government period but could not turn into a legal regulation due to the opposition of trade lobbies, has now turned into a necessity.

Retail market chains are another factor forcing the producer. These structures, which can buy the product from the producer under their own conditions and make high profits, make the producer unprofitable like the companies operating in the market. Of course, everything ultimately depends on the control of the whole process. Unless effective control mechanisms are established, it seems difficult to get results, no matter what legal arrangements are made. If the right choices are made in terms of policy processes, it will take a certain amount of time for production to settle on a ground suitable for market conditions. However, at the current stage, it is necessary to see that we are far away from the right choices.

As a result, we need to understand the risks that the cycle of non-production we have entered into poses for our future. The profits to be made by the privileged friends of some should not be more important than the general interests of a people. In a country where "we have money so that we can buy from abroad" is a seriousness at the ministerial level, issues such as food security and agricultural production should be discussed more. Those who criticise "we buy seeds from abroad" should also question why we have problems producing our own seeds.

It is too late to realise the gravity of the situation when you go to the market and see the prices. We should also realise that a very small portion of the prices paid in the market goes into the pockets of the producers. We need to understand that this wild trade order is a very critical turning point in Turkey's agriculture and a problem that has the potential to create vital problems for Turkey if it is not ended. There is no income without production and no development without increased income. It is high time to get rid of fairy tales...

With respect