Organic Hazelnut Business
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1 Source: Wikipedia Organic Hazelnut Business Content Background Supply chain structure Agricultural production Harvesting & post harvest handling Raw material purchase Processing & packaging Export & import Conclusions facing key challenges Turkey is by far the biggest hazelnut producer in the world, with clear competitive advantages.
2 Background The hazelnut is native to the Black Sea coast. The special climate on this coast, with sufficient rain during the whole year, ensures the high quality of Turkey s hazelnuts. Turkish hazelnuts are classified as Giresun or Levant quality. Turkey is by far the biggest producer and exporter of hazelnuts worldwide: Approximately hectares are cultivated with hazelnuts in the Black Sea region. About half a million growers are involved and a lot of seasonal work force during harvest. All in all, about 4 million people in Turkey earn their income from hazelnut production, marketing and processing! With around tons of yearly hazelnut production (only kernels), Turkey produces 70-75% of all hazelnuts worldwide. Italy, as the second biggest producer, has only a share of 12-15%. Around 80% of Turkey s hazelnuts exports relate to EU countries. According to the Turkish association of organic agriculture ETO, organic hazelnut production relates still to a relatively small share, less than 10% of total production, but generating an interesting turnover of million US dollars per year with exports. Since hazelnuts are considered to be a healthy food ingredient, demand is likely to grow in the future.
3 Source: Bjørn Christian Tørrissen Supply Chain Structure Individual Farmers Turkish Processors Foreign Buyers In comparison to other supply chains in Turkey, the organic hazelnut supply chain is relatively short. Within Turkey, it consists mainly of farmers and processing companies, which buy their raw material directly from farmers. Many thousand families produce hazelnuts for a fast developing processing industry offering a wide range of different hazelnut export products. Farmers Organic hazelnut farmers own in average 2 to 3 hectares of land. As hazelnut production involves relatively little work, except during harvest in August, farmer families are often involved in off-farm activities to generate sufficient income. The orchards are well maintained, with continuous pruning to rejuvenate the shrubs. Farmers tend to have a supply contract with hazelnut buying companies. Processors They own processing facilities for grading, storing and shelling plus additional processing equipment. Besides hazelnuts in shell, processed products such as blanched, roasted, chopped and ground hazelnuts as well as pastes are exported. Foreign buyers As specialized ingredient trading companies, they buy hazelnut products as raw material for the chocolate, confectionery and baking industries, and as ingredients for nut and muesli mixtures, etc.
4 Agricultural Production Hazelnuts can be grown without irrigation in Turkey. Organic farmers manage Grass coverage preserves soil moisture during their orchards fairly well. Most important crop management practices relate to summer and prevents erosion in winter. pruning, pest management, and soil management/fertilization. Pruning Pruning in younger shrubs is important to optimize growth by creating a beaker-form that allows maximum exposure to sunlight. Later, pruning is essential to rejuvenate the producing wood; main branches are cut at cm above the ground. Sprouts that appear during the year are continuously cut. Pest management Hazelnut production in Turkey is affected by two main pests: (1) hazelnut weevils (Balaninus nucum), whose adults feed on young developing nuts, and (2) big bud mites (Phytocoptella avellanae), which cause the nut buds to wither. Both are managed using wood ash and sulphur. Soil management/fertilization Hazelnuts are shallow rooted and need plenty of moisture to grow well. If necessary, hazelnuts are irrigated, often by flooding. The soil under the hazelnut bushes is commonly covered in weeds and grass, which is cut from time to time. Fertilization is done with farmyard manure, compost and lime, more seldomly with chicken dung.
5 Harvesting & Pre Drying Harvesting In Turkey, the harvest season of hazelnuts is August. Nuts are either harvested directly from the tree, or picked up from the soil when fallen down. In both cases, the complete buds are harvested: nuts, husks, and leaves. Given the vast extension of hazelnut production in northern Turkey, many thousand temporary workers are involved. Pre-drying The harvest is brought to a place where the filled buckets or crates are emptied for pre-drying. The harvest is placed on nylon sheets or on a concrete floor, with layers of cm height. To ensure optimal drying and prevent bacteria and mycotoxin infestations the drying hazelnuts are shifted once per day. Important: Hazelnut harvesting is very much depending on migrating workers. As entire families are involved, child labor is common. Buying companies are advised to discuss this issue together with the export companies. Nuts turn brown when ripening. At harvest, nuts together with husks and leaves are picked from the tree. After a few days of pre-drying, nuts are mechanically cleaned from the husks.
6 Source: Gerhard Pils Cleaning, Drying & Storage Dehusking When leaves are brown, nuts are separated from husks and leaves using a thresher, a special dehusking machinery ( see below). Drying After this step of cleaning, nuts are placed back on clean nylon sheets for sun drying. Altogether, depending on weather conditions, around days are needed for drying (including pre-drying). Storage Once the shells are dry, nuts are put into bags and brought to an on-farm storage place, unless produce is directly brought to the processor, who is likely to have better storage conditions. Dehusking separates the nuts from all surrounding plant material, which can be easily composted. Sun drying positively impacts the taste of hazelnuts and makes Turkish nuts special. If storage conditions are good and the sales contract allows it, nuts might be stored to obtain higher sales prices later on.
7 Raw Material Purchase In the case of hazelnuts, product aggregation is directly done by processors. Given the big investments that were submitted into hazelnut processing facilities in Turkey in the last 20 years, not only roasting capacities have been enhanced: The whole technology of hazelnut processing has fully developed. The competitiveness of processing facilities depends on big volumes. Buying contracts are essential to ensure these volumes. When receiving the nuts from farmers, the following parameters are used to assess the quality of each delivery: Quality parameters (1) humidity of nuts, (2) impurity of delivery, (3) size of nuts. Three nut sizes are differentiated (with shell): size 9-11 mm, size mm, size mm. Waste parameters Insect damage, moldy and rotten nuts. Holes are a sign for hazelnut weevil damage, which results in empty nuts without kernel.
8 Processing Processing involves different steps, depending on the final product which is elaborated. Most common are the following steps: Hazelnut processing in Turkey has become a big and meaningful industry. Grading In a first step, received hazelnuts are mechanically graded according their nut size. Cracking & regrading Each lot, differentiated by size, is passed through a cracking machine, which is adjusted to the nut diameter of each grading size. The shell is separated from the kernels, which are graded again to obtain homogenous nut categories. Selection Shelled nuts are selected by hand on a revolving sorting-belt: Broken, infested or moldy nuts are removed. It is important that the people responsible for selection work under very hygienic conditions and that the machinery and sorting-belts are thoroughly cleaned prior to processing organic hazelnuts. Further processing Depending on the possibilities to further process the nuts and the requests of clients, nuts may undergo additional processing steps, especially roasting. Ideally, smaller and broken kernels are processed into hazelnut flour or paste.
9 Packaging Packaging, as the last step of processing, is very much defined by clients, in regard to the type of product that is to be delivered and its packaging. Packaging depends on the type of delivered final product. Jute bags are common for whole nuts. Whole kernels Most common are big bags (from 500 kg to kg), jute and paper bags (from 25 kg to 80 kg), and transparent or laminated foil, vacuum bags with or without cartons (from 5 kg to 25 kg). Sliced kernels & meal Packaging size varies between 5 kg to 25 kg. Most common are nylon and laminated vacuum bags. All packaged products pass through a metal detector. Labelling must comply with the regulation on organic agriculture and includes the lot number (traceability), product quality, date of processing and expiration date.
10 Export & Import Export and import relates to the following main activities and aspects: Export of hazelnuts in shells has become rare: Today, more than 90% of all exports from Turkey are hazelnut kernels. Warehousing Final packed and labelled products are stored in a cool and dry place until delivery to the final destination. Logistics and labelling must be organized in a way as to guarantee traceability of the product. Shipment According to delivery contracts, final products are mainly loaded into export containers or trucks. Delivery and paying conditions are specified according to Incoterms, where the most frequent payment arrangement is CAD (cash against documents), in which an exporter instructs a bank to hand over shipping and title documents to the importer when the importer fully pays the accompanying bill of exchange or draft. Inspection & certification The infrastructure and procedures of both the exporting and importing company are inspected and certified. Labels are subject to approval from the inspecting control bodies. Requirements may slightly vary, according to the standard used for certification (e.g. EU, US, Bio Suisse). Important: Price fluctuations may occur when production is drastically reduced, e.g. due to frost in spring.
11 Conclusions Facing Key Challenges In summary, the organic hazelnut business has different success factors, which are summarized here: Agricultural extension for hazelnut growers Although organic hazelnut farmers tend to generally manage their orchards well, it is important that they have extension support to further improve their practices, especially in regard to effectively fight the main pests: The hazelnut weevil (Balaninus nucum) and the big bud mites (Phytocoptella avellanae). Important are also best practices in regard to postharvest management to prevent losses in the drying and cleaning process. Consultants may also function as internal inspectors that make sure that farmers do not use forbidden inputs. Contaminated produce from one farmer can cause decertification of an entire aggregated lot. High quality processing infrastructure and procedures As foreign clients are demanding in terms of product quality and traceability, processing and procedures must meet the highest quality standards. To ensure that the organic produce is not contaminated with equipment also used for conventional production is of special concern. In this regard, quality assurance (QA) is highly relevant not only within the processing infrastructure, but also along the value chain, ensuring that farmers and workers at harvest do not use equipment that might be contaminated from conventional production (e.g. crates, bags).
12 Is Everything Clear? We hope that the information presented here was helpful to you. If you have any comments or you want to learn more, please get in contact with us.
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