How can Turkey increase olive oil exports?
Ayvalık is a cute, historic coastal town on Turkey’s Aegean coast, popular among those who want to escape the mega cities. The town is set to apply to enter UNESCO’s World Heritage List because of its “industrial heritage.”
That “industrial heritage” is due to the fact that olive oil production has been active in Ayvalık for centuries. In ancient times, the area’s name was Kyodonies, meaning the place of quince/Cydonia trees because of the abundance of quince trees. Toward the end of the 19th century, Ayvalık was a huge olive oil and soap production center with a number of factories on the coast. Current Mayor Rahmi Gencer said it was once even called “Little Boston” because of this industry.
“When the population exchange happened in 1922, the Orthodox Greeks in Ayvalık left this land. Muslim Turks from the nearby islands across - from Lesbos, Crete and elsewhere - came here. The population of Ayvalık totally changed, but the newcomers kept the businesses going. Olive oil and soap production continued uninterrupted.” Gencer said, speaking at the 12th Ayvalık International Olive Harvest Days.
The history books say Ayvalık once supplied the olive, olive oil and soap needs of the Ottoman palace, and its products were exported all the way to Marseilles. It is possible to see the old factories, depots and workshops along the coast in Ayvalık, all symbolizing this industrial heritage.
The Ayvalık Chamber of Commerce was able to obtain a “geographical indication” for Ayvalık Olive Oil in 2007. “Olive oil is more precious than gold,” said Professor Canan Karatay, who was also present during the harvest festivities this year. Indeed, on every TV show she appears on, Karatay recommends that viewers drink a small cup of olive oil every morning.
She was also one of the panelists and led an interesting discussion with Gencer. When the mayor complained about not having enough money, Karatay objected. “You should question yourself if you say you do not have money in the land of olives,” she said.
This reference to the economy of olive was on point, because Turkey is the fifth largest olive oil producer in the world. Our production in the 2015-16 season was 143,000 tons. However, as Ayvalık Chamber of Commerce head Benhan Kantarcı pointed out, despite being the fifth top producer in the world, Turkey’s share in global olive oil exports is only 1 percent.
There is clearly something wrong in this equation. Kantarcı said exports could be increased through branding with added value products, productivity and quality.
Turkey aims to increase its olive oil production to 400,000 tons by 2023, but it will not be possible to sell this amount domestically. In countries such as Spain and Italy, annual olive oil consumption per person is 13 to 14 liters; in Turkey it is only 2 liters. So there is no way out other than pulling Turkey’s 1 percent share in olive oil exports upward.
As Kantarcı said, you can be competitive with branding and quality, but how will you solve the “country image” issue that is crucial in exporting?