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What we can learn from Turkey, the world’s No. 1 flour exporter

Turkish Flour chairman Turgay Unlu, Turkish Exporters chairman Mehmet Buyukeksi and Turkish flour millers meet the Philippine delegation.

ISTANBUL, Turkey — After I lost my father at age seven, I came to learn this principle: disadvantages or handicaps often boost a person’s or nation’s strength through sheer resourcefulness and grit. Examples are many of the world’s self-made entrepreneurs who grew up fatherless or orphans, poor, part of a minority or an immigrant.

Societies disadvantaged by a lack of natural resources but which have made themselves prosperous include Singapore, Hong Kong, South Korea and Israel. Singapore has no vast oil reserves but has built itself as a major refined-oil exporter, Asia’s biggest physical oil trading hub, home to the world’s largest oil bunkering port and also one of the world’s two biggest oilrig builders.

 

 

 

 

Turkey Accounts For 1/3 Of Global Flour Exports

Another amazing example of resourcefulness and grit is Turkey, which I recently learned is the world’s pioneer in domesticating wheat in their strategic location between Europe and the Middle East. Although it grows a lot of wheat, for years Turkey has been importing more wheat mainly from Russia, yet it has made itself into a world-class flour-milling giant and is now the world’s undisputed No. 1 biggest flour exporter, exceeding former flour export leader, the USA.

Based on statistics from the International Grains Council (IGC), the world’s 2016-2017 flour exports are projected to rise to 15.95 million tons, compared to 15.6 million in the previous season due mainly to the rising export of flour gains by the resourceful flour millers in Turkey. IGC forecast Turkey’s flour exports in 2016-2017 at 5.3 million tons in wheat equivalent.

Making up nearly 32.5 percent, or one-third of the world’s total export trade in wheat flour, Turkey will achieve what Morton Sosland described as “the largest amount of flour ever exported by a single country in history.”

After World War II, US flourmills responded to emergency needs financed by the US government to ship a peak of around 90 million cwts (hundredweights) in a single year. Turkey will this year roughly equal that volume at between 85 million and 90 million cwts of exports, with analysts saying this is “a remarkable achievement for a nation that first exported flour in 1984-85, shipping 7,000 tonnes of wheat equivalent, and which did not ship as much as one million tonnes until 2004-05.”

Increasing Sales Via Upgrading Image Of Quality

During a breakfast interview in Istanbul, the Turkish Flour Yeast and Ingredients Promotion Group (TFYI) led by chairman Turgay Unlu said they are optimistic about increasing Turkish flour exports to the Philippines in 2017 with the launch of a new quality-certification system in March with the help of academic experts. He said the new certification system would help Turkey achieve its target of increasing exports to the Philippines by debunking any false rumors or wrong perceptions that Turkish flour products were of inferior quality. He said this strategy is for Turkish flour products to target the Philippines’ higher-end baked products, too.

I verified with successful French Bakery chain owner and former UP business college teacher Johnlu Koa that Turkish flour is indeed of good quality. Koa said, “Yes, of course, the Turkish people are pioneers in that field, they’ve been milling flour for many centuries.”

TFYI, established in April 2012, promotes Turkish flour, yeast, starch, soups and ingredients globally by improving brand image and increasing exports of value-added products. The Philippines will be the first market where Turkish flour will implement their new quality-certification system. Under this plan, free Turkish flour will also be distributed to bakeries and industrial producers for quality tests and trials early this year.

Free-Market Competition Fosters Entrepreneurial Strengths

Based on my observations, one of the reasons for the entrepreneurial strength of Turkish flour exporters is the dynamic and intense free-market competition in their industry. I believe this is similar to the case of why ethnic Chinese entrepreneurs and Jewish entrepreneurs flourish worldwide; they grew in strength due mainly to intense rivalry and competition. In a country with a population of 80 million people, I was amazed to learn from chairman Unlu that Turkey has 715 flour mills and they export to 120 countries!

Unlu said that this year their target is to export a total of 4 million tons of Turkish flour, which hopefully means at least 100,000 tons for the Philippines. He said last year, Turkish flour exports to the Philippines totaled US$27 million; they hope to double that this year to $50 million.

Another lesson we entrepreneurs and the government can learn from Turkey, aside from encouraging more dynamic free-market competition, is to boost the unity and collective efforts of exporters. In Turkey, they have a strong group called the Turkish Exporters Assembly, which has 65,000 members and 60 associations under it, including the Turkish flour exporters. The chairman of this Turkish exports bloc is Mehmet Buyukeksi, who joined the breakfast with the Philippine flour importers and media delegation.

Buyukeksi said, “Bilateral trade between Turkey and the Philippines is low at only $220 million. The Philippine market is only 2.7 percent of Turkey’s total flour exports; this is too small, we have good quality flour. We can export more to your country with more flour, textiles, garments, etc. You in the Philippines should endeavor to export more goods to us here, too. I am a member of the board of Turkish Airlines, recently awarded as Europe’s best airline, it is important that we have direct flights from Manila to Istanbul so this should also promote more trade and more tourism, too.”

Turkish diplomats also said that with President Duterte’s reform of pursuing an independent foreign policy, the Philippines and Turkey could also improve defense cooperation and consider buying ammunition and arms from Turkey instead of just from the US as we mainly did before. President Duterte has announced that he is open to buying arms from China and Russia; adding more countries is beneficial to the Philippines.

TFYI leaders told me that increased Turkish flour exports to the Philippines will benefit our whole country by adding competition to the market, thus helping lower prices of flour for local entrepreneurs, and ensuring stable low prices of bread, cakes and noodles for consumers. When I asked a question about the Philippine flour millers’ complaints about their alleged dumping strategies, which supposedly violate international fair trade practices, TFYI leaders categorically denied it and said the allegation was unfounded. Turkish Exporters Assembly chairman Buyukeksi added: “We don’t understand these unfair and untrue anti-dumping charges.”

Beyond flour, I urge our Philippine entrepreneurs and professionals to learn from the resourcefulness, grit and bold, export-oriented global mindset of Turkey’s 715 flourmills.

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Thanks for your feedback! Email willsoonflourish@gmail.com or wilsonleeflores@yahoo.com. Follow @wilsonleeflores on Instagram, Twitter, Facebook, and my new blog, wilsonleeflores.com.

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