Miller Magazine Issue: 141 September 2021

71 INTERVIEW MILLER / september 2021 the leading flour exporters of our country and we export to more than 50 countries. Mr. Kaşıkçı, you are closely following both Turkey and the world markets. The coronavirus epidemic has led to multifaceted changes in economies. So, how was the in- ternational sales of the world export champion Turkish flour industrialist affected in this process? The pandemic brought with it the biggest demand shock the world economy has seen since World War II. According to the World Bank, the world economy shrank by 3.6% in 2020. The tourism, transportation and retail sectors were severely affected. However, if we exclude the HORECA (hotel, restaurant, cafe) segment, there has not been a sig- nificant decrease in wheat flour demand in the world and in Turkey, as it is a staple food. In fact, in the early stages of the pandemic, we encountered a very intense demand for flour both from within the country and from abroad. I be- lieve that our industry, which is often unfairly scapegoated during this period, has passed this test successfully. Many flour industrialists, especially Kavukçu, made a commit- ment not to increase prices for a certain period of time and took a responsible stance. I think this is the best proof that our industry neither has a reflex to raise money unless there are unbearable increases in basic input costs, nor does it have the opportunity due to intense competition in the industry. CONTAINER CRISIS AFFECTS FLOUR EXPORTS The panic demand experienced at the beginning of the pandemic returned to normal in the following months. As I mentioned above, I think that there may have been a 10% - 15% decrease in the general flour consumption of our country in 2020 due to the shrinkage in HORECA. We did not encounter a serious decrease in demand in our export markets during the pandemic. However, the biggest problem for the exports was the container crisis, which started in the last quarter of 2020 and continues today by getting worse. There were unprecedented and sudden increases in container freights. In addition to the price increases, the supply of containers was also a big problem. Lines started not accepting freight independent of price and shutting down service. Unfortunately, this troubling situation I mentioned still continues and our 2021 wheat flour export may therefore be completed at a lower level than the previous year. If we want Turkey to reach its export target of 500 billion USD, one of the strategic steps we need to take is to keep the container transport sector of our state under close watch and to implement a national line that will break the oligopolistic structure in the sector as soon as possible. IDLE CAPACITY PROBLEM A few years ago, flour production was carried out in over 700 plants in Turkey. But a consolidation process has begun. Today that number has dropped below 500. But still the installed capacity is twice the need. Almost half of the production capacity is idle. How can we get out of this impasse? We can count many factors in the increase in the num- ber of flour factories in our country. Some of these are the incentives given to flour factory investments in the 1980s and 1990s, the increase in the urban population, the in- crease in flour exports in the 2000s, the fact that flour mill machinery is produced in our country and it is possible to establish a factory with relatively low investment costs. However, there is one factor that is much more important than all these factors, and that is that our business people do not make a detailed analysis and feasibility while mak- ing an investment decision, and they often act by saying