UMIT GUVENC PRESENTATION TURKEY A MAJOR PLAYER IN THE WORLD PROCESSING TOMATO MARKET FOODNEWS TOMATO FORUM ROME JUNE 2009

1. FOODNEWS TOMATO FORUM
UMIT GUVENC
EXPORT MANAGER, TAMEK
TURKEY - MAJOR FORCE IN TOMATO
PASTE EXPORT MARKET

2. TURKEY (in a nutshell)
Turkey processes approximately 2 million tons of industrial
tomatoes per processing season
t t i
Annual capacity of Turkish paste production is approximately 0,5
million tons as 28/30 brix t.paste basis.
There are 7-8 main companies and their plants (up to 40) operating
during the (northern hemisphere) processing season (July –
September)
Turkey supplies most of its exports to its neighbouring countries
countries,
Iraq, GCC, Japan, East Europe and other European destinations, which
Europe used to be Turkey’s traditional t.paste market for several
decades up until 1997.
Turkey has been in talks with the EU for increased access all the
time

3. TURKEY EXPORT FIGURES ’93 –
‘08
TURKEY'S TOMATO PASTE EXPORT (SOURCE: IGEME)
TON 1000 USD
1993 109.939 83.142
1994 132.807 104.101
1995 106.987 94.513
1996 148.898
148 898 122.954
122 954
1997 159.523 126.010
1998 169.897 135.376
1999 171.870 123.973
2000 172.692 92.499
2001 123.353 74.933
2002 124.125 77.233
2003 149.801
149 801 100.238
100 238
2004 183.254 133.770
2005 155.083 126.679
2006 102.303 92.748
2007 87.002 90.774
2008 105.331 150.578

4. TURKEY’S PASTE EXPORT FIGURES ’93 – ’08
200.000
200 000 QUANTITY(TON)
( )
AMOUNT (1000 USD)
180.000
160.000
160 000
140.000
120.000
120 000
100.000
80.000
80 000
60.000
40.000
20.000
0
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

5. 2007 GLOBAL T.PASTE TRADE EXPORT SHARES OF
COUNTRIES
35,0%
30,0%
25,0%
20,0%
15,0%
10,0%
5,0%
0,0%
0 0%
IT ALY CHINA SPAIN PORT UGAL USA GREECE T URKEY
Series1 31,2% 26,4% 10,7% 6,8% 5,0% 3,5% 2,8%

6. LOGISTIC ADVANTAGES OF TURKEY
SHALL IT BE ABLE TO CHANGE TRENDS IN
MOVEMENT OF GOODS ?

7. PASTE EXPORTS EX TURKEY TO MAIN
DESTINATIONS 2008
TON 1000 USD
IRAQ 28.595 45.764
GCC 22.507 30.064
OTHER 18.906 27.865
JAPAN 15.915 20.155
RUSSIAN FEDERATION 9.029 10.714
AFRICA 6.648 10.454
GERMANY 3.731 5.562
TOTAL 105.331
105 331 150.578
150 578

8. 160.000
140.000
120.000
100.000
80.000 2008 (T ON,)
2008 (1000 USD,)
( ,)
60.000
40.000
20.000
0
JAPAN
AFRICA
EDERATION
GERMANY
IRAQ
TOTAL
GCC
OTHER
RUSSIAN FE

9. ALGERIA
GERMANY
NIGERIA
LIBYA
SUDAN EUROPE
MOROCCO
AFRICA MIDDLE EAST
SAUDI ARABIA
KUWAIT
UAE
IRAQ
Q
BAHRAIN
SYRIA
QUATAR
OMAN
TURKEY JORDAN
ISRAEL
GCC FAR EAST
RUSSIAN FEDERATION EAST EUROPE JAPAN
UKRAINE

10. EUROPE
-EU played a big role in the establishement of the turkish industry back in
’60’s
60 s
-80’s: Quotas for turkish paste: 12 EU members, + the following 3 EU
members trade of quotas, rather than of paste ? Difficult times and a
lot of activity/ trade going on
-Quotas for dices 8.500 tons
-EU does not keep Turkey on the bay, trade activity may go up to 60.000
tonnes
-Main buyers: UK, Germany, Holland, Austria, Sweden, Finland, mainly
y , m y, , , , ,m y
northern Europeans incl. Norway and to some extend Switzerland
-Those countries don’ta have any processing activity, they are merely users
of paste, and turkish paste is one of their favorites
turk sh s the r fa or tes

11. EUROPE
-Apart from the quotas and quantity limitations this was a real
l l
cooperation,
Northern EU member states mainly (tax payeers, as well?) buy the paste
they need
-Turkish industry supports the TR - EU talks under 97/1, which increase
the paste quota (Tariff Contingency) from somewhere (which was a very
limited quantity to 30 000 tonnes (’97)
30.000 ( 97)
-Big surprise same year this quota not used at all turkish paste plus
retaliation in the form of 14.4 % duty on turkish p
f f y paste, surprisingly
, p gy
however dices remain to acces duty free under the 8.500 tonnes quota
-14.4 % remains same as it is even today, after Turkey trying to be part of
EU since 1963

12. EUROPE
-Well, we both EU and TR need real sustainable, stable cooperation,
don’t we ? Hope those days are nearer, by now, can only give
advantage to both parties
-Turkish industry will continue to support the EU and noneuropean
buyers, whereever they need should they be in the north, and/or
should they be i the south
h ld th b in th th

13. MIDDLE EAST GCC
-Middle East & GCC is by far the biggest consumer of processed tomato,
and it is growing
-The region takes in turkish tomato paste with big interest, as also the
cuisines are quite similar, too
i i it i il t
-There is almost unlimited potential for the MENA Region to take in much
more turkish processed tomato maybe also declare self presence in the
tomato,
industry in Turkey
-Maybe by now it is only a matter who will lead the entry as another
question

14. MIDDLE EAST GCC
-Right now even during global crisis Turkey is explicitely declaring that
Turkey may not need the IMF settlement very explicitely.
l l l
-Guess where the cash is coming from ?
-Guess what a sustainable business esp. from eastern Anatolia to the next
door neighbours (300 km.s ?)

15. FAR EAST
TAMEK BAHARU
FOOD&CONCENTRATE CORPORATION
IND.&TRADE INC.CO
4F Tabacco Center
Nispetiye Mah. Hakki Building2-16-1
Sehithan Sok. No:35 II.Ulus Nishnishinbashi Minatoku
Besiktas
TOKYO/ JAPAN
ISTANBUL/ TURKEY

16. TAMEK
FOOD&CONCENTRATE
IND.&TRADE INC.CO RUSSIA
Nispetiye Mah. Hakki
Sehithan Sok. No:35 II.Ulus
?
Besiktas
ISTANBUL/ TURKEY

17. TAMEK
FOOD&CONCENTRATE
IND.&TRADE INC.CO KSA
Nispetiye Mah. Hakki
Sehithan Sok. No:35 II.Ulus
?
Besiktas
ISTANBUL/ TURKEY

18. FAR EAST
-Japanese discovered the turkish tomato first in 1970’s
p
-In this case our Japanese fellows have been much more proactive,
and it was more by their activity to promote the first HOT
m y y p m f
BREAK paste production in Turkey
-They have been also leading turkish industry to produce the first
aseptic tomato paste as one of the firstcomers (’81) and dices
thislike (‘89)
-There is a big similarity in between th both cultures, as well, good
for any joint activity, incl. industry and trade

19. FAR EAST
-This will expand in the years to come for sure, and both Japanese
p y p
and turkish parties will grow
-Turkish industry may be more proactive
ym y m p

20. TURKEY EXPORT HISTORY
-1960’s modern t
1960’ d tomato paste i d t plants are b ilt and
t t industry l t built d
production is started, Turkey started its tomato paste export
in 1967 with a symbolic figure as 3 tonnes.
y g
-1960’s Heinz Intervention in some establishments for export
purposes
-1970’s Japanese friends started to walk around to arrange
some HB production
d ti
-1990’s Turkey took place as the third in the list of producers,
y p p
and later dropped down to 5th place after Chinese production
and increased production of Portugal.

21. - Until 1997, in year 1989 export figures excessed 150,000 tonnes, following year’s
l ll
figures are settled around 120,000 tonnes.
- 1997 some big surprises ( from EU ) when top quantities were contracted there:
-a) Rise of the free Non Zero Tariff Contingency for paste incl. EU 12+3 to 30.000
tons per annum
-b) Abolish the same, and start to apply 14.4 % on turkish paste and other tomato
products
d t
-c) Establish a 8.000 tons of ‘other tomato products’ tariff contingency
- 1997 tomato paste export figures reached 160,000 tonnes.
160 000 tonnes
- 1998 with a 6% increase exports figure became 170,000 tonnes, and hit 183,000
tonnes in 2004.
- 2001 and 2002, tomato paste production is increased- especially in the Usa and
China - prices are reduced accordingly, caused Turkish paste prices become above
the market .

22. -Turkey exports tomato paste and processed tomato products to more than 85
countries, in particular to Japan and Russian Federation. Export to these two
countries’ share was 34% in year 2002, 31% in 2004, and 24% in 2005.
- 2 of Turkey’s traditional export destinations Algeria and Libya (S.P.L.A.J) had
some domestic market difficulties which effected their import figures in negative
way.
-Among other countries, Iraq became the biggest tomato paste importer in
Turkey’s
T k ’ export countries in 2006.
i i 2006
-Japan was the second and Saudi Arabia was the third. In 2008 Turkey exported
46 million $ valued tomato paste to Iraq which was appr. 30% of the whole tomato
paste export value.

23. TURKEY vs. WORLD TRADE
- Most known tomato paste producer Usa, China, Italy, Turkey, Greece, Chile,
Portugal.
g
-USA a big net importer of tomato products untill 90’s (100.000 tonnes per annum.
-After 90’s new production plants are set, production increased at the same time
After 90 s, set increased,
China started producing tomato products and offered high quantity, relatively
cheap prices to the market. Production in these two countries unbalanced USA’s
domestic market as well as World trade market.
-Chinese penetration into tomato paste market caused excess of tomato paste
stocks which made prices decrease dramatically. Importers use this price and
carried their import level one step up
up.
-In 2007 Italy the biggest tomato paste exporter, followed by China, Spain third,
Portugal fourth, Usa fifth and Turkey 7 th. Turkey have been in top ten tomato
paste producer and exporter in the world, even though Italy, Greece, Spain, and
d d h ld h h l d
Portugal is in EU and using all known advantages of being a part.

24. TURKEY vs. WORLD TRADE
Turkey’s Competitive Power
- Beginning of the century, there was no tomato paste consumption in
China, at all however according to some Chinese colleagues, consumption
of fresh tomatoes would be around 1,5 million tonnes in 2008.
15 2008
- Most top 10 exporters and Turkey badly hit by the severe competition,
everybody is after Chinese Paste
- Turkey’s production potential can be increased depending on right and
efective policies, subvensions which will drive investors to agricultural
investments as well as farmers to produce more.
- GAP (Southeast Anatolian Project) project is one of the project which
will double fresh tomato production in Turkey under which conditions !
- Where will this extra paste go ? To the EU ? Well Turkey has
- 30.000 tons of non duty Tariff Contingency, could not open EU yet, but
Turkey pays 14,4% tax in the move of its products into the EU. Will it
change over time ? Which time ?

25. TURKEY vs. WORLD TRADE
Turkey’s Competitive Power cont’d
- EU is 10 million or whatever tonnes big and it has to
i illi h bi di h
consistently continue the 10 million tonnes, the consumption is
there. How will EU do it ? Somebody here whispering: Will it be
with a shift to Turkey, as a main alternative ? Why ? Why not ?
y y y
- In Eu industrial fresh tomatoes subsidy average € 30 + can be
varied by the years, in Turkey similar policy does not apply at all,
which limits Turkey’s competetive power ? Is it true. Well, your
Turkey s true Well
presentor does not think so.
- Policies applied between 1978 and 2007 have provided benefits
to
t growers and processors i th EU, what about Turkey
d in the EU h t b t T k
growers and processors, a shift from EU here, as well ?

26. TURKEY vs. WORLD TRADE
Turkey’s Competitive Power cont’d
ARE THE FOLLOWING SENTENCES MEANING A DEFENSE
POSITION ?
- Changes in 2001 and 2008 and both have been billed as CAP reform
- Changes between 2008 and 2011 will phase out the € 34.50 per ton
payment and replace it with income support that is approximately equal
to current expenditures (€300 million)
(€
- Implications in Europe and in other regions that produce processing
tomatoes
- Moreover, in Italy, the provisional aid is fixed for farmers in 1300
, y, p f f f m
euros per hectare in 2008, while the final will be determined at the
conclusion of the campaign and checks required by regulation.

27. TURKEY vs. WORLD TRADE
Turkey’s Competitive Power cont’d
- The farmer will suffer a proportional reduction in hectares in case of
delivery less than 70% of regional productivity as by decree enacted
productivity, enacted,
except owing to a cause beyond control.
- Other Countries, as Spain, will have a coupled aid less than the Italian
one,
one whereas others, as France, will have a notable higher aid (2500
others France
€/hectare).
- In order to increase Turkey’s competetive power, the idea of improving
agriculture under contract system grower s organisations is in
agriculture, grower’s
discussion, is Turkey ready to this ?
- Turkey in your presentor’s view n perception is ready to many things
including a big turn in the industry

28. TURKEY vs. WORLD TRADE
Turkey’s Competitive Power cont’d
- About the European field, the pursuance of this reform has been quite
standardized:
- Portugal, the partially decoupling system will l t 4 years, with th
P t l th ti ll d li t ill last ith the
coupled aid percentage equivalent to 50
- Greece, the system will last 3 years, with the coupled aid percentage
equivalent to 30%
- France, Italy and Spain, the system will last 3 years, with the coupled
aid percentage equivalent t 50%
id t i l t to

29. TURKEY vs. WORLD TRADE
Turkey’s Competitive Power cont’d
- Anyway, Turkey’s first step is 4 – 10 million tons, probably to realise
within 5 years ?
- What will happen thenafter ? Is a good question
- DEFENSIVE POSITIONS IN EU TO BE REPLACED
WITH OFFENSIVE POSITIONS IN TURKEY ?
WILL TURKEY BE THE NEW CHINA ? WELL
TURKEY DOES NOT TO BE THE NEW CHINA,
TURKEY NEEDS TO BE THE NEW TURKEY
PROBABLY !

30. TURKEY vs. WORLD TRADE
Turkey’s Competitive Power
Turkey s
WHAT MAY IT BE TO USE FOR ?
- DEFENSIVE POSITIONS IN EU TO BE
REPLACED WITH OFFENSIVE
POSITIONS IN TURKEY ? WILL
E
TURKEY BE THE NEW CHINA ? WELL
TURKEY DOES NOT TO BE THE NEW
CHINA, TURKEY NEEDS TO BE THE
NEW TURKEY
PROBABLY !

31. WORLD PRODUCTION VS.
APPARENT CONSUMPTION Consumption
Production
40000
35000
30000
25000
20000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
SOURCE:SOPHIE COLVINE (WPTC GENERAL SECRETARIE)

32. PER CAPITA CONSUMPTION acc. to
REGIONS
Per Capita Consumpt ion
25,00
20,00
15,00
annum
10,00
1989 - 1990
C
5,00
5 00
kg/a
0,00 68% 25% 26% 24% 23% 2002-2003
A
% CHANGE
IC
15
12
25
IC
IF
ER
EU
EU
EU
C
PA
P
AM
IA
TH
AS
U
SO
Regions

33. TURKEY A FULL MEMBERSHIP OF AMITOM
WELL NOT OF EU YET DESPITE TO BE IN THE
FIRST TO COME LIST
(45 YEARS)
Source: Amitom

34. AMITOM VS. WORLD TOMATO PROCCESSING
INDUSTRY PRODUCTION SHARES
100%
80%
60%
40%
20%
0%
2001 2003 2005 2007 Other
YEARS China
California
Source: Tomatoland AMITOM

35. TRENDS IN INVESTMENT IN
TURKEY
-- NOMIKOS
-- MORNINGSTAR
IS THIS A TREND ALREADY OR PROBABLY INCIDENCE AS OF TODAY
? WHY MORNING STAR AND NOMIKOS THERE IN TURKEY ?
IS IT A FIRST INDICATIONS OF A REAL TREND WHEN WILL THE
REAL TREND BE THERE ?
AND AS THE TREND STARTS HOW CAN WE FIND THE RESULT NOT
TO DEVIATE FROM THE MEAN SUBJECT DUE TO AGLOMERATION
?

36. WHAT’S AHEAD FOR TR ?
-Will Turkey attract the 1 million tons of consumption increase / annum ? To
what extend ?
-Turkish industry will continue to support the EU and noneuropean buyers,
whereever they need. Should they be in the north, and/or should they be in
the south doesn’t matter
-There is almost unlimited potential for the MENA & GCC Region to take in
much more turkish processed tomato, maybe also some of them to declare
self presence in the industry in Turkey
-Maybe by now it is only a matter who will lead the entry as another question
-Guess what a sustainable business esp. from eastern Anatolia to the next door
neighbours (300 km.s ?)
-This will expand in the years to come for sure, and both Japanese and turkish
sure
parties will grow
-Some players may be more active in Russia ? Don’t they ?
p y y y

38. THANK YOU FOR
LISTENING
MR. UMIT GUVENC,
,
EXPORT MANAGER
TAMEK FOOD&
CONCENTRATE /
TURKEY