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Opinion

Chilean Hazelnut Exports Soar 101% in Q1 2023/24

Published Jul 11, 2023

Chilean hazelnut exports have surged in the first quarter of the 2023/24 season, reaching 10,863 metric tons (mt)compared to 5,381 metric tons in the same period last year and the five-year average of 5,056 mt. With a record crop of 65,000 mt, a 20% increase year-on-year (YoY), exports are expected to easily break previous records. With the harvest recently completed and competitive prices, Chilean hazelnuts could be favored over that of Türkiye.

Increase in Production Boosts Exports

Chilean hazelnut production increased steadily over the last 20 years, as covered in More Records Await Chilean Hazelnuts After Successful 2022/23 MY. The 2023/24 harvest is complete, and current production estimates are around 65,000 mt (in-shell). Chilean hazelnut producers organization, Grupo Avexa, estimates hazelnut production in Chile could reach 80,000 mt in 2025, having a market share of 8 to 10% of global production. Chile normally exports more than 90% of its production. On an in-shell basis, production in 2023/24 could reach 27,500 mt, and domestic consumption over the last five years averaged around 2,000 mt. This would leave more than 25,000 mt available for exports. As production is expected to continue growing, holding large inventories serves little purpose except for price speculation.

Record Exports in Q1 of 2023/24

Chilean walnuts exports have soared so far in the 2023/24 season, with 10,863 mt already exported in the first three months of 2023/24, from April to June, compared to 5,381 mt over the same period in 2022/23 and 5,056 mt the five-year average. Exports in May reached a record 4,916 mt, followed by 3,641 mt exported in June, the second highest on record.

Source: Chile Customs

Strong Demand from Europe Due to High Prices in Türkiye

Chile is the only significant producer in the Southern Hemisphere and has the advantage of an alternate season to Northern Hemisphere producers. The Chilean harvest normally starts at the end of February and runs until May. Global supply chain disruptions have changed the export seasonality of Chilean hazelnuts, but going forward, May to July could be the top export months, as the Northern Hemisphere crop is harvested starting in August.

While Chile’s alternate season is a big selling point, the uncompetitive prices offered by Türkiye have also played in Chile’s favor. As Türkiye’s hazelnuts have been priced higher than most other exporters, buyers were looking towards alternative sources. Since the latter part of 2022 and the first half of 2023, Georgian and Azerbaijani hazelnuts were favored above that of Türkiye. However, Türkiye remains the world's largest producer, with over 60% of global production. As a result, importers have opted for other sources as far as possible, but inventories in these countries are virtually depleted, with Türkiye the only significant supplier.

Chilean exports to Europe soared by 73% in the first quarter of the marketing year to 9,212 mt. Chile exported 2,478 mt to Canada throughout the whole of the 2022/23 MY and has already exported 1,083 mt to Canada in Q1, 2023/24. As freight costs have also plummeted over the last, Chilean hazelnuts are even more affordable. Global freight costs have dropped nearly 80% from a year ago, lowering transportation costs to their largest destination in Europe. Exports are expected to maintain the momentum in the coming months as Chilean hazelnuts compete well in price and quality. However, the continued weakening of the Turkish lira is bringing Turkish hazelnut prices back to export parity, which will increase export competition between the two countries.