Union of Chambers and Commodity Exchanges of Turkey

The seminar on establishing effective commodity exchanges, capacity improvement and development of agricultural goods trading in Islamic Development Bank (IDB) member states was held at the TOBB Union Center. TOBB President M. Rifat Hisarcıklıoğlu, Minister of Food, Agriculture and Livestock Mehmet Mehdi Eker and IDB Representative Ayhan Karaca made the opening speeches of the seminar which was attended by many representatives from IDB member states.

TOBB President Hisarcıklıoğlu, starting his speech by thanking Minister Eker for his contributions, stated that hunger has become one of the most crucial problems of the world and that there is a great possibility that the situation will worsen over the years.

Hisarcıklıoğlu said, “Two issues will determine world politics in the 21st century. One is energy, the other, agriculture and water sources. Our age will be shaped by these two issues,” drawing attention to the fact that the world’s population has tripled since 1950.

Stating that the increasing middle class population means that more people are stopping production and becoming complete consumers, Hisarcıklıoğlu said that increasing food prices likewise increase global inequities.

Saying that farming, which used to be done for subsistence, has now become a source of significant income, Hisarcıklıoğlu said, “Investors wanting to make money will invest in agriculture. We have to accept this.”

- “Hunger is unlike other problems”

Stating that the significance of the hunger issue is also stemming from the management of water, TOBB President Hisarcıklıoğlu said, “70% of the world water consumption is used in agriculture. The increasing demand for water causes a shortage of water, in turn causing famine. In short, food shortage is one of the most significant problems of the century. This issue is like nothing else. Because this is hunger. This is about feeding people. There is one fact; there is a very serious development gap between our countries. I emphasize this often. According to SESRIC data there is 220 magnitudes of development difference between the most and the least developed Islam countries.

None of us can live in peace until we sort out this difference. If we do not find employment for our brothers struggling with famine we won’t be able to live in our own homes in peace. We cannot live in peace in our own home if we do not extend our hand to the child waiting for food in Somalia. We can’t pass muster in the afterlife as long as we share the same world with people who live on less than 1 dollar a day.

Yes, we must consider this problem for all humanity, starting with our own region. We must produce solutions. We must take responsibility. We must use the office, position and wealth given unto us to this end. This problem cannot be solved without consideration and there is no relief until the situation is reversed. We cannot sleep while our neighbor is hungry.”

- Functions of the commodity exchanges

Stating that agricultural investments should be considered on a basis of global need instead of regional, Hisarcıklıoğlu said that despite the rate of the world’s population growth, the growth of arable land is no longer possible. Quite the opposite, during the last quarter of the century arable land has decreased by 25% as well as a drop in the quality of land.

The only solution is to increase efficiency, stated Hisarcıklıoğlu; the trade of agricultural goods must be made efficient. Stating that at this point commodity exchanges take on an important role, the TOBB President said, “Commodity exchanges are markets that bring together many buyers and sellers together.  They are places to provide information regarding international markets, where quality is inspected and where governments’ decisions relating to it are disseminated. Transparency is possible in the market thanks to the commodity exchanges.

Thanks to the commodity exchanges, neither the farmers, traders nor the industrialists are deceived. Exchanges connect the producers in rural parts to centers in urban, allowing access to fresh goods for many traders and industrialists. Commodity Exchanges contribute greatly to the economic and social transformation of countries with agriculture based economies and the prosperity of their people.”

- TOBB at the center of agriculture

Relating how TOBB resides at the center of the agriculture sector through the commodity exchanges, Hisarcıklıoğlu said that today Turkey has 113 commodity exchanges where agricultural goods are dealt in on the spot. Stating that commodity exchanges have, especially in the last 10 years, invested heavily in order to bring better service to the producer and trader and to put goods on the record, Hisarcıklıoğlu spoke:

“We have established labs to inspect and identify goods in 67 exchanges. Most of these have become accredited and are operating in an international capacity.

We are in the process of establishing information and experience sharing network between labs.

We are strengthening the communication infrastructure of our exchanges. The prices generated throughout Turkey are being consolidated into a single source in the TOBB website, published simultaneously in Turkish and English.

Another important step we have taken lately is the launch of the licensed warehousing system and the initiative to establish the commodity markets that issue commodity trade contracts.

First licensed warehouse started its operation in Polatli, Ankara as a pilot project and we plan to expand licensed warehouses to all of Turkey. When all of these steps are complete, Izmir Derivatives and Options Exchange (VOB) which is established by TOBB, will be able to process more agricultural goods.

With all of our efforts, we are determined to make sure that our commodity exchanges contribute to the reform process in the agricultural sector. As the Union of Chambers and Commodity Exchanges of Turkey, we are ready to share our experiences of over a hundred years.”

- Minister of Food, Agriculture and Livestock, Mehmet Mehdi Eker

Minister of Food, Agriculture and Livestock, Mehmet Mehdi Eker stated in his speech that food security would take a big step forward in IDB member countries if a joint agricultural investment policy were to be implemented.

Minister Eker stated that there are both temporary and permanent human needs. Agriculture and food are permanent needs and will never expire, Eker said, with seasonal needs rising and falling throughout time.

Eker said that although the technology used today did not exist 50 years ago and that some of it will not exist 50 years later, the need for food, and agriculture will certainly persist.

- Joint Exchange

Eker stated that the agricultural production has increased from 23 to 62 billion dollars during last 9 years, making Turkey rise from the 11th to the 7th rank among the agricultural producer countries in the world.

Eker said that Turkey owes this success mainly to formulating a strategy to increase productivity and to enact supporting policies. Food, Agriculture and Livestock Minister stated that Turkey is ready to share its experience and to establish close cooperation with the member states of the IDB.

-  Islamic Development Bank Representative Ayhan Karaca

Islamic Development Bank Representative Ayhan Karaca emphasized the significance of agricultural sector with regards to establishing food security, increasing foreign income and abolishment of poverty.

Karaca stated that farming holds 13% investment share in the IDB, up from 3% in 2007, and that the Bank plans on increasing its investments to the field of agriculture in line with the 2020 goals. Karaca also stated that the Bank plans on increasing the investment percentage of the field from 13% to 20% within the next 5 years, contributing to the activities of millions of small scale farmers.
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