In Trade Retaliation, Turkey Raises Import Tariffs on Rice

ISTANBUL, TURKEY – USA Rice staff traveled to Turkey last week to meet with local trade and gather firsthand market information on the country’s rapidly changing political and economic environment.  

Turkey faces strong inflation due to political insecurity as last month inflation here was at 15.4 percent, the highest experienced since October 2003.  Elections concluded on June 24 with a victory for President Recep Tayyip Erdogan, concentrating all powers in the hands of the president.  

Overall economic implications of this power shift are yet to be seen although impact on the rice industry has been immediate.  For the first half of 2018, the Turkish government had reduced import tariffs for all rice origins to ensure adequate domestic rice supply, however, starting July 1, import tariffs were raised back to original levels -- 34 percent for paddy, 26 percent for brown rice, and 45 percent for milled rice.

In addition, Turkey announced a retaliatory tariff of 25 percent on U.S. rice to be applied on top of “normal” tariff rates as a response to recent steel and aluminum tariffs imposed by the U.S. government.
 
Turkey has yet to import any U.S. rice in 2018 due to the relatively high price of U.S.-origin product compared to other origins present in the market including Greece, Russia, and Portugal, as well as low quality Chinese rice.  Additional tariffs do not make the situation for local trade any easier.

In this challenging market environment, U.S. rice is still available on the shelves of Turkish retailers for now, and USA Rice continues to support sales through in-store promotions and media servicing.  

“Media activities keep U.S.-origin rice top of mind for Turkish consumers,” said Hartwig Schmidt, USA Rice regional director for Africa, Europe, and the Middle East.  “Also, to strengthen the high quality image of U.S. rice, USA Rice conducts wild rice specific promotional activities here, communicating the health benefits and other nutritional features to foodservice professionals as well as the media.”