Industrialized agriculture brings change in Turkey

By Doug Stanfield
October 30, 2013

We've all heard versions of the story, and many of us have relatives or ancestors who were a part of it.

Small farmers, the story goes, are being squeezed out of business by large-scale, "industrial agricultural" corporations. Forced to buy patented, more expensive but higher-yielding hybrid seeds and the fertilizer and pesticides they require from multinational conglomerates, farmers harvest larger crops but at the price of rising debt. It is sometimes portrayed as a David and Goliath morality play -- with Goliath winning -- but the reality is much more complicated.

Yetkin Borlu, a Ph.D. candidate in Penn State's Department of Agricultural Economics, Sociology and Education, came to the University to study the issue as it applies to his native Turkey. He has just returned from a trip home where he interviewed farmers about current economic realities they face.

Borlu's focus is on the social dynamics of his country after a decade of change in agricultural production that resulted in the loss of nearly three million agricultural jobs. He is looking particularly at the impact of the expansion of industrial maize (corn) since 2000 as the economy shifted from a development model based on rural welfare to a model based on competitive markets.

The changes began following an intervention by the International Monetary Fund and the World Bank, both of which demanded market reforms as a condition of further production and loans from global lenders. In response, Turkey's government began to undo the old system and implement reforms, but these changes resulted in a sharp decline in agricultural employment as a percentage of the economy, from 38 percent of total employment in 2000 to 25 percent ten years later.

"A lot of jobs in this sector were lost, but I wanted to better understand social dynamics, how people made economic decisions, and how social dynamics influence those decisions," Borlu says. He's looking into the growth in production of corn as a way to understand the various forces involved.

"Production doesn't increase by itself," he says. "There has to be demand. Corn production in Turkey has doubled in the past ten years. Where is all this corn production going?"

He has found that the same answers apply to Turkey as to many other parts of the world, including the United States.

Increasingly, Turkish corn is sold for use as a processed sweetener and animal feed, Borlu says. This corn is converted to liquid form in factories in Turkey, and then used in a vast array of processed foods, fast foods and soft drinks, both domestically and on the international market.

Currently, less than ten percent of annual corn production is for direct human consumption, he adds. Approximately 15-20 percent of the annual corn crop supplies the industrial sweetener market, with the remainder processed into poultry feed.

Marking the Changes

"In the past, producer cooperatives subsidized the costs of inputs -- fertilizer, seed and pesticides," Borlu explains. "At the other end, there was the Grain Board, which used to guarantee a market to farmers. But that started to change.

"Large private corporations' role has changed, to where they are providing more and more of the inputs needed to cultivate corn such as fertilizer, hybrid seeds and pesticides, and are also driving the demand for certain crops over others by buying in large quantities."

Turkish farmers, like many of their counterparts around the world, have altered their crop mixes to be able to sell more and make more money. But this means they carry more debt than under the old system, in order to buy the more expensive inputs necessary to grow enough corn to satisfy the big buyers.

"Smaller farmers can't wait for best price, because of pressure of debt, and have to sell into the market as soon as the crop is ready," Borlu says.

Even so, he adds, farmers are adapting to the changes, and those still in business -- the majority --  are figuring out how to make a profit. "Even though small-scale producers have been getting lower prices under the new market system, they're still making some money."

In Turkey, 80-90 percent of farmers are still small, operating farms of about 50 acres or less. Most in the areas he visited recently are growing corn now, instead of more traditional crops like cotton, but are making enough money to pay their debts.

Larger producers, he says, have more financial resources and aren't as dependent on loans, and have more bargaining power with corporations when they sell their crops because they are not pressured by debts.

Overall it's a mixed picture, Borlu concludes, but despite the challenges, small farmers seem to be holding on.

"I'm not trying to say that industrialization and consolidation is all good for people, but neither am I finding that small farmers are being wiped out," he says. "Government policies are geared to the further integration of farmers into a market with less government intervention and more private firm activity.

"Because agricultural employment still represents one quarter of the total employment in Turkey, political decision-makers cannot ignore the opinion of agricultural producers. Thus we do not see a complete withdrawal of the government from the markets, but government intervention as a balancing power based on supply and demand. This is different from the old rural welfare policies."

Borlu believes the story of change in Turkish agriculture is like that in many other countries. "Farming will always be a large part of the economy there, due to climate and geography," he says. "But methods of production are definitely changing."

Yetkin Borlu is a Ph.D. candidate in rural sociology and can be reached at Borlu's proposal for the research described above was selected in the Master's Thesis and Dissertation Research Award Competition by the Rural Sociology Society in 2012.

Last Updated July 28, 2017