According to EastFruit analysts, there is currently a true investment boom in the greenhouse business of Turkmenistan, which has one of the world’s largest natural gas reserves. Therefore, greenhouse owners in this country enjoy incredibly low prices for the natural gas, which, coupled with a relatively warm winter and inexpensive labor, create opportunities for competitively priced production of greenhouse vegetables in the winter.
It is true that very few people in Europe know much about Turkmenistan, but this country is already among the global leaders in tomato exports. In 2022 it has replaced Uzbekistan as the largest exporter of tomatoes in Central Asia, taking advantage of Uzbekistan’s continued problems with gas supplies to their greenhouses. Moreover, it is expected that in 2023-2024 area of greenhouses in the country may double and reach 1400-1500 hectares, which would also double the output of greenhouse tomatoes as nearly all greenhouses in the country specialize in this crop.
This fact, however, brings up the question of marketing. The expected sharp surge in supply could lead to a collapse in domestic prices tomatoes prices and the country is very far from the markets. Moreover, Turkmenistan relies mainly on the exports to Russia, which is probably the most unreliable trading partner in the world.
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“Fortunately, in 2022 Turkmenistan was able to export first significant volumes of tomatoes to the UAE and Saudi Arabia. It is this direction of export diversification that should be a priority for the country. However, these markets have high requirements for quality, safety and packaging of products, so now it is important for Turkmenistan to invest not into production volumes, but into improving quality, sorting and developing efficient logistics. Optical sorting of tomatoes, for example, should already be a standard equipment in every large greenhouse operator if they want to diversify exports,” says Andriy Yarmak, economist at the Investment Centre of the Food and Agriculture Organization of the United Nations (FAO).
“However, it must be considered that the big problem for Turkmenistan is the summer season, when the air temperature in the country is high, and the yields in greenhouses, as well as the quality of the tomatoes, can be relatively low. However, this particular period is the most promising for exports to the countries of the Middle East, because from May to mid-November prices for tomatoes in the UAE and Saudi Arabia are the highest. And in the winter, prices in the Middle East are the lowest because local greenhouses are producing at low costs,” notes the FAO expert.
Growers should also pay attention to the assortment and find their niches in the competitive market of the Middle East. Given the expensive logistics and low labor costs in the country, it is logical to assume that the more expensive segments of greenhouse tomatoes will have greater prospects for making a profit when exporting. However, segments such as cherry tomatoes also require a higher level of technological knowledge and are more demanding in terms of logistics. Also, volumes of trade in these segments are also much smaller.
Turkmenistan also needs to explore the possibility of exporting winter tomatoes, for which the largest surplus is expected in the near future, to the countries of the European Union. Here it will be very important to find logistics solutions, as well as to ensure certification of production in accordance with GlobalG.A.P standards.
In any case, it should be expected that already in 2024-2025 Turkmenistan may for the first time be faced with a huge problem of excess greenhouse products on the market and it is an excellent sourcing opportunity for the buyers.
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