Exporting sectors, which supply their inputs with dollars and realize their exports in Euro, have been going through difficult times recently due to the negative course of the Euro/Dollar parity.
The euro/dollar parity, which was at the level of 2021 in July 1,18, has been following a course of 0,99 in recent days.
The ready-to-wear and apparel industry, which has earned 1 billion dollars in foreign currency for Turkey in the last 21,5-year period, provides all its inputs, especially cotton, with dollars, and exports to Europe, where more than 70 percent of its exports are realized, on a Euro basis.
The fisheries and animal products sector, which is the largest export market of European countries and whose inputs are all in dollars, especially fish feed, is another export sector that is adversely affected by the change in Euro/dollar parity.
Expressing that they had problems in accessing finance in 2022, Aegean Ready-to-Wear and Apparel Exporters' Association President Burak Sertbaş said that while there was difficulty in accessing finance, the industry experienced a loss of income because its inputs were in dollars and export revenues were in euros.
Pointing out that there is also pressure on export prices due to the expectation of recession in global economies, Sertbaş said, “The expectation of recession, difficulties in accessing finance and the appreciation of the dollar caused the positive atmosphere in the sector to turn into a negative environment. In the second half of 2022, our increase in exports may stop, and we may even see a decrease in parity. As EHKİB, our exports increased from 3 million euros to 118 million euros with an increase of 122 percent on a euro basis in July, and decreased from 11 million dollars to 140 million dollars with a decrease of 125 percent on a dollar basis. We may experience a similar picture in the coming months," he said.
They expect a turn towards Turkey from the Far East.
Sharing the information that Europe imports from the Far East in dollars, Sertbaş added that they expect European importers to prefer Turkey instead of the Far East after the change in parity, and that they hope to compensate for the loss of parity in this way.
The fact that the euro/dollar parity has decreased to the level of 0,99 and that it can be seen at 0,95 causes a worried expectation in the Turkish aquaculture sector.
Bedri Girit, President of the Aegean Fisheries and Animal Products Exporters' Association, stated that although the exports of the Turkish aquaculture sector increased by 2022% in euro terms in the January-July period of 33,5, it remained at the level of 20% in dollar terms, and that many inputs, especially feed raw materials, are the largest inputs. He emphasized that it is indexed to the dollar and that the current situation negatively affects the competitiveness of the sector.
Underlining that 65 percent of the total expenses in aquaculture are feed expenditures, Girit said, “The most important raw material of the feed used in aquaculture is fish meal and oil. Since the fish meal and oil obtained in Turkey is not enough to meet the feed requirement, there is an import obligation for these products. This is also provided in dollars. In 2021, we imported approximately 202,6 thousand tons of fish meal and 91,5 thousand tons of fish oil. 10 of the top 7 countries of our exports are European countries. The fact that our inputs are in dollars and our revenues are in euros caused the sector to lose its profits. As exporting sectors, we have great difficulties in accessing finance. We expect the rediscount credits to be opened as soon as possible.”
Be the first to comment