The world’s largest hazelnut producer, Turkey, is at the centre of a tense standoff between local dealers and Ferrero, the Italian confectionery giant behind Nutella and Ferrero Rocher. A combination of poor harvests, pest infestations, and speculative hoarding has sent hazelnut prices soaring, threatening stability in a market that supplies two-thirds of global demand.
Global Hazelnut Market Under Pressure
Turkey normally produces between 600,000 and 700,000 tonnes of hazelnuts annually — about 65% of global output. This year, yields have dropped sharply due to a spring frost and an infestation of the brown marmorated stink bug, locally known as the “sputnik.” Industry insiders believe the true harvest may fall below 300,000 tonnes, far lower than the government’s forecast of 450,000 tonnes.
Prices have responded dramatically. According to CG Hacking, a London-based trading firm, the price of natural hazelnuts (kernels without shells) has nearly doubled from $9,000 per tonne in June to $18,000. The Turkish Grain Board (TMO) raised its official support price by 20%, but the market quickly surpassed it.
Dealers Stockpile, Ferrero Holds Back
Local Turkish intermediaries have been buying aggressively from farmers, anticipating that Ferrero will eventually need to re-enter the market to replenish supplies. “The local dealers have basically been buying everything they can get their hands on in anticipation of Ferrero coming to buy,” said Giles Hacking, of CG Hacking. “These guys are basically holding Ferrero to ransom.”
Ferrero, which consumes roughly 25% of the world’s hazelnuts, has so far held off major purchases, relying on existing inventories and alternative sources in Chile and the US. “Everybody plays games,” said Marco Botta, general manager of Ferrero Hazelnut Company, describing the current market as “a waiting game.”
Despite rising prices, Botta emphasized that Ferrero is not in a rush. “We have a very long coverage this year … we are not in a rush to buy,” he said.
Expanding Beyond Turkey
Over the past two decades, Ferrero has diversified its hazelnut sourcing, establishing large-scale operations in Chile, the United States, Italy, and Serbia. Both Chile and the US now produce around 100,000 tonnes annually, with Chile aiming to double its harvest to 200,000 tonnes within the next decade.
This global sourcing strategy, Botta explained, gives Ferrero the flexibility to withstand crises like the current one in Turkey. “It gives us the opportunity to manage years like this one, where there has been frost and drought,” he said.
Still, Turkey remains the cornerstone of Ferrero’s supply chain. While the company has no formal contract with the Turkish Grain Board, Botta reaffirmed Ferrero’s long-term commitment to the country.
Economic Strain on Turkish Farmers
For small producers, the spike in prices offers little comfort. In the Black Sea region, where most of Turkey’s hazelnuts are grown, high inflation and rising labor costs have cut deeply into profits.
Farmer Saadettin Irmakçi from Ordu reported that his orchard yielded just 30 kilograms of nuts this year — barely 2% of his usual 1.5-tonne crop. “Nut prices are going up,” he said, “but they are only where they should be. Fishermen make in a single day what we make in a year.”
Growing Tensions in the Industry
The market turmoil has heightened fears among Turkish exporters that Turkey could lose global dominance in hazelnut production. Fırat Bakıcı, export director at Poyraz Poyraz Hazelnut, warned that Ferrero’s market power is distorting dynamics.
“When prices reached 320 lira per kilo, Ferrero said it would buy at 260,” he noted. “So no one sold.” He argued that Turkey had effectively turned one of the world’s largest buyers into a broker controlling the market, adding: “No country in its right mind does such a thing.”
Bakıcı also blamed rising Turkish labor costs and the lack of a national brand strategy for eroding competitiveness: “Hazelnut is the lamb of nuts — high quality, with a sophisticated aroma. But Turkey acted only as a subcontractor for Europe.”
Ferrero’s Outlook
Ferrero has dismissed speculation that it will raise Nutella prices, with Botta asserting that the company’s existing contracts and diversified supply base protect it from short-term volatility. “We don’t have to change any recipe,” he said.
The company, already one of Europe’s largest privately held food groups, plans to double its turnover within eight years. Yet its growing influence — and Turkey’s heavy dependence on Ferrero as a buyer — have left the global hazelnut market in a delicate balance between Italian patience and Turkish pressure.
