WATER POLITICS

BACKGROUND:  In contrast to short-term price shocks from events like the devastating February 6th earthquake or Russia’s invasion of Ukraine, Turkey’s chronically high food inflation reveals a fundamental vulnerability in Turkey’s food system that threatens its role as a food supplier to Europe and the Middle East-North Africa (MENA) region. Among the 38 democratic, market economies of the Organization of Economic Cooperation and Development (OECD), Turkey’s food inflation rate stands far outside the norm. In May 2023, Turkey’s food inflation rate of 52.5% was 400% percent higher than the OECD average. The fragility witnessed in Turkey’s food system is chronic and structural – a result of the country’s inadequate capacity to respond to severe water stress and drought. The UN’s Intergovernmental Panel on Climate Change estimates that 60% of Turkey’s land area is prone to desertification.

Turkey’s cultivation of cash crops has depleted groundwater aquifers and dried out river systems and lakes as high temperatures, drought, and water stress continue to increase in Turkey.  Worsening the problem, many desperate farmers drill illegal wells that tap groundwater that is already at very low levels.  In a 2020 survey of farmers across Turkey conducted by the Turkish Industry and Business Association (TÜS?AD), 97% of farmers reported diminishing harvests and yields due to climate change-related impacts on their farms. The problem illustrated by the TÜS?AD survey is compounded by frequent record low water levels in the dams that supply Turkey’s major cities, exacerbating the competing demand pressures between water for human consumption and hygiene and the considerable water needs of Turkey’s agricultural sector, which accounts for about 74% of Turkey’s water consumption.

The climate change-driven pressure on the food-water-energy nexus that is responsible for reducing water availability in Turkey is endangering Turkey’s lucrative food export revenues and its role in international food supply chains, in addition to Turkey’s own food security. Turkey’s role as a food supplier to Europe and the MENA region fundamentally rests on Turkey’s production of cereal grains, particularly wheat, corn, and barley.  These grains require significantly larger quantities of water compared to vegetables.  They also have to compete with premier cash crops like cotton, which requires about 11,000 liters per kg compared to about 1,800 liters to produce 1 kg of wheat. Beyond being a raw material export, cotton plays an essential role in Turkey’s textile and apparel exports, which generally account for at least 10% of the country’s GDP. Turkey’s top food export earner, hazelnuts, require 9,807 liters of water per kilogram, and earned Turkey $1.29 billion in 2021. 

Using 2021, the year prior to Russia’s invasion of Ukraine, as a base year, Turkey’s six largest agricultural products by weight were cattle milk (21.3 million tons), sugar beet (18.2 million tons), wheat (17.6 million tons), tomatoes (13.09 million tons), corn (6.75 million tons), and barley (5.75).  While cattle milk, as well as cattle meat, are primarily designated for domestic consumption, both depend on animal feed, much of which is derived from corn and barley.  So does chicken meat – Turkey’s fifth largest agricultural export by value in 2021. Grain-derived animal feed is one of the most significant costs for Turkey’s milk and meat industries. The cost of Turkish agricultural production is fundamentally related to water consumption.  While the production of a kilogram of sugar beets requires 132 liters of water and tomatoes 214 liters, the water required for cereal grain production is at least five times greater, with wheat requiring 1,800 liters while corn and barley 1,200 and 1,400 liters per kilogram respectively.

In terms of exports, wheat flour and pastas (macaroni) constituted Turkey’s largest 2021 food exports by quantity, 3.1 million tons and 1.29 million tons respectively, with baked goods and breakfast cereals ranking 11^th and 13^th.  In terms of export revenues, wheat flour is Turkey’s second most valuable food export at $1.15 billion, surpassed only by hazelnuts.  Turkey’s pastries were the 7^th largest food export earner and pasta the 8^th largest, earning a combined $1.52 billion.  Turkey is also the world’s 5^th largest producer of sugar beets, with confectionary sugar being Turkey’s 10^th largest agricultural export. Turkey’s combined 2021 export revenues from confectionary sugar and sugar-containing chocolate products amounted to $1.32 billion.

The importance of Turkey’s role in regional food supply chains should not be underestimated. Turkey is the world’s largest exporter of flour and one of the largest pasta exporters. This has produced the curious situation of Turkey being a perennial top 5 wheat importer worldwide while also being the world’s 10^th largest producer of wheat.  By government regulation, Turkey’s flour and pasta exports must be made from imported wheat. Generally, close to 70% of Turkey’s imported wheat is processed and re-exported as flour and pasta.  Turkey’s own production cannot provide sufficient wheat to meet its domestic demand even though Turkey uses imports to concurrently supply its lucrative flour, baked goods, and pasta export industries. 

IMPLICATIONS: In addition to earning Turkey important export revenues, Turkey’s agricultural exports form key elements in several different food supply chains to Europe and to the MENA region.  Germany is Turkey’s second largest agricultural export market, with its 2021 purchases of Turkish agricultural products totaling $1.8 billion. Italy’s 2021 purchase of almost $1 billion of Turkish agricultural goods ranks Italy as Turkey’s second largest European market and sixth overall. The United Kingdom is Turkey’s seventh largest agricultural export market, while the Netherlands, France, and Romania are nine, twelfth, and thirteenth respectively.  Turkey is also a key food supplier to the MENA region including fragile nations that have been emerging from civil conflict like Iraq (Turkey’s largest agricultural export market), Syria (Turkey’s fifth largest), Libya (eleventh), and Yemen (sixteenth). 

In Marketing Year 2022/2023, Iraq, Syria, and Yemen were the largest destinations for Turkish wheat exports.  Additionally, Israel and the United Arab Emirates (UAE), each of which recently experienced a diplomatic rapprochement with Ankara, are respectively Turkey’s tenth and fifteenth largest agricultural export markets.

Israel, the UAE, and several of Turkey’s European partners are leaders in several different cutting-edge agricultural technologies that enhance water-use efficiency and drought resistance. Developing agritech strategic partnerships with these nations could mitigate the vulnerabilities in Turkey’s agrifood production.  Although Turkey’s commercial relations with Israel are robust, posting continued growth despite a decade-long downturn in diplomatic relations, cooperation in agritech has been neglected. Following the August 2022 restoration of full diplomatic ties, the head of the Israel-Turkey business council observed that “Israel can contribute a lot in exporting agri-tech in very different areas of agriculture to help the Turkish agricultural field become much more modern and upgraded.” Israel is a global leader is drip irrigation and several water security technologies. These agri-water technologies have been at the core of a strategic agri-tech partnership between Israel and India that has helped India become the world’s second largest wheat producer, achieving record yields in wheat as well as other crops in the face of rising water shortages.   Israel’s agricultural attaché foresees an additional 30-35% crop yield increase in India as a result of the deepening Israeli-Indian agri-tech cooperation.

The UAE, which has emerged as a global food player with agricultural and food production assets from South America to South Asia, has been making large investments in agri-tech and sustainable farming.  Following Ankara’s rapprochement with Abu Dhabi, Turkey and the UAE signed a memorandum of understanding on agricultural cooperation aimed at “adopting modern climate-smart agricultural systems, increasing food production, and ensuring the continuity of supply chains.”

However, as with Israel, the potential of agri-tech cooperation between Turkey and the UAE remains largely unrealized. Like Israel, the UAE has engaged India as an agri-food partner and is investing in a $7 billion project to establish a food corridor to ensure the food security of the Emirates and other Middle Eastern countries. Since the April 2022 conclusion of a Comprehensive Economic Partnership Agreement between the UAE and Israel, the two countries are actively working in concert together with India on an India-Middle East Food Corridor. The trilateral cooperation in forging a new inter-regional food supply chain that benefits from advanced agri-water technologies could serve as a model for Turkey-Israel-UAE trilateral agricultural cooperation.

The most promising solution for Turkey may come from the field of biostimulants — nutraceuticals that stimulate plants’ natural processes to enhance their nutrient uptake and use or their ability to tolerate stresses like heat and drought. Companies from Germany, Italy, the Netherlands, the UK, and the U.S. – all top 10 agrifood export markets for Turkey – along with Spain, are industry pioneers in biostimulant development. Drought conditions can cause a crop like wheat to lose up to 50% of its root system, hampering growth despite receiving water after drought conditions cease. Biostimulants can make crops resistant to such drought stress. Beyond drought resistance, biostimulants can be used to increase the water-use efficiency of cereal grains and Turkey’s other major crops. 

CONCLUSIONS: As climate-driven challenges to Turkey’s agrifood production intensify, Ankara has little time to lose in adopting agri-tech solutions to avert detrimental impacts on its own food security and its role as a key exporter in regional food supply chains.  As Turkey seeks to ways to reset several of its foreign relationships following its May 2023 presidential elections, diplomatic outreach based on developing agri-tech partnerships is as timely as it is pressing.  Agri-tech from drip irrigation to biostimulants offers Ankara a win-win basis to engage a variety of partners.  Drip irrigation and other water security technologies make Israel a natural partner for Turkey. Trilateral cooperation between Turkey, Israel, and the UAE modeled on the successful synergy of India-Israel-UAE agrifood cooperation could establish a new economic formation while bolstering broader regional food security. Similar opportunities exist for the European Union and its member states to development win-win engagement with Turkey through European agri-tech, with biostimulants offering the most immediate low capital investment solution. Crucial for promoting Turkey’s own food security and preserving its role in regional food supply chains as Europe and MENA seek to counteract the damage of accelerating climate change, agri-tech diplomacy offers an opportunity for Ankara to exercise regional leadership that it cannot afford to pass up.