(23 December 2021 – Turkey) As Turkey suffers a debilitating currency crisis after the country slashed interest rates at the urging of President Recep Tayyip Erdogan in the quest of a weaker Turkish Lira to encourage exports and expand productive industry, hazelnuts farmers who produce most of the world’s supply are in the firing line, negatively impacting Nutella’s supply chain.
The Lira has lost half of its value in 2021, and up to a third of its value in November alone, as Mr Erdogan fired central bank governors and any senior government officials who disagreed with his aggressive economic strategy. The Turkish hazelnut industry employs four million people who produce 70 percent of global hazelnut supply. The sharp depreciation in the value of the Lira is increasing the cost of fertilizer, seeds, pesticide and other imported goods.
Nut factories are paying more for energy, packaging and transportation while labour costs are set to jump as the Turkish government elevates the minimum wage to keep pace with crippling 21 percent hyper-inflation. Italian company Ferrero who produces Nutella purchases up to a third of Turkey’s hazelnut export output.
“The world is on the verge of hazelnut shortage. If you are a Nutella fan, you better stock up at your next food-shopping visit” commented Turkish consultant Turgan Zülfikar.
“There is no quick fix in the economy. You can’t push a button and get a result. In his mind it may be easy, but it’s not easy for ordinary people. It’s destroying everyone’s life with higher prices, inflation” stated Turkish Economist Uğur Gürses.