Interview with İlkay Öz: Privatisation has been devastating for small farmers and highly profitable for large companies
Agricultural and livestock policies in Turkey are once again under discussion due to the impact of accelerating privatisation and market-oriented transformation since the 1980s. As the liquidation of public institutions increased cost pressures on producers, price stability and food supply became more fragile.
We spoke with İlkay Öz about the consequences of privatisation in agriculture and the structural crisis in livestock farming.
Privatisation practices in Turkish agriculture represent a process in which publicly owned enterprises were sold off on the grounds of increased efficiency, but ultimately triggered deep instability in the market. Looking at this picture, the risks inherent in the privatisation of public enterprises become clear. Looking back today, we see that the liquidation of these institutions led to the collapse of price-balancing mechanisms that worked mainly in favour of producers. How should we interpret the impact of these institutions' withdrawal from the market on small producers; did it create efficiency in agricultural production as claimed?
Agriculture was one of the sectors most severely affected by the privatisation process that began in the mid-1980s. Institutions such as YEM-SAN, the Turkish Agricultural Equipment Corporation and the Turkish Dairy Industry Corporation, which provided producers with low-cost inputs, prevented private companies from arbitrarily raising prices, and purchased producers' products at relatively high prices, were privatised one by one. Without public ownership, the free market became so relaxed that feed manufacturers, dairy manufacturers and chain stores gained the power to establish monopolies and impose their desired prices on producers.
The main criticisms levelled at TSEK, which was established to promote the development of dairy farming and support producers, as well as to ensure consumers' access to dairy products, were its low capacity utilisation and inefficiency. However, TSEK operated at very high capacities in its production facilities in the western provinces, while in the eastern provinces, the aim was not so much profitability as the development of regional livestock farming, the creation of a market for farmers' milk, and the economic development of the region. Therefore, it had assumed a social responsibility that differed from the efficiency and capacity utilisation in the west. However, looking at the criticism received, for example, according to TÜSİAD, the leading representative of the Turkish bourgeoisie, TSEK's operation at low capacity, especially in the eastern provinces, was a major problem in terms of efficiency. On the other hand, TSEK's failure to make a profit while paying high prices to producers and selling low-priced products to the public was also the focus of criticism based on neoliberal profit-loss logic. However, the profit made by the institution means a reduction in the money going into the producer's pocket and an increase in the money coming out of the consumer's pocket. Just as chain stores and dairy producers currently make high profits in this way.
On the other hand, the fact that feed manufacturers can increase prices as they wish for feed, which is currently the largest cost item for dairy farms, is due to the privatisation of public institutions such as YEMSAN. Apart from costs, when milk prices increase, feed manufacturers also raise feed prices. Thus, the raw milk-feed parity falls again, and the money in the farmer's pocket goes to the feed manufacturer. Because a ‘free market’ where there is perfect competition and buyers and sellers determine prices by agreement is nothing but a myth. What actually exists is an oligopolistic structure established by a handful of companies. In the agriculture-food sector, where there is no power in favour of the public, it is these companies that are able to determine prices. Therefore, privatisation has created a high-profit environment for large companies, while being devastating for small farmers, producers and the public.
TURKISH LIVESTOCK FACE A DILEMMA
Today, the inability to control input costs and the resulting “price balancing through imports” strategy have put livestock farming in an unsustainable cycle. In light of this picture, how would you describe the current function of the Meat and Milk Board in this new order, where the market has evolved into a structure entirely focused on the private sector and imports?
In its current form, the Meat and Milk Board (ESK) is essentially a structure that attempts to respond to supply and demand imbalances in the market through imports and intervention purchases. This is an expression of the state's loss of capacity and the inadequacy of its intervention tools, as I mentioned earlier. It is impossible to say that the ESK contributes to dairy farmers beyond processing the surplus milk supply and exporting milk powder. It purchases live animals from farmers through meat processing plants, processes them after slaughter, and offers them for sale, but this is also insufficient. There are already insufficient animals in the market, and on the other hand, in the existing animal trade, intermediaries, traders, speculators and companies are making high profits due to the state's lack of capacity. In milk production, if I am not mistaken, ESK has only one facility processing dairy products, making it an ineffective structure compared to SEK.
Another ineffective tool of state intervention in the dairy sector is the National Dairy Council (USK). Although the USK announces a reference price for milk, this price has no binding force. Nevertheless, due to the strategy of suppressing inflation through dairy products, the USK has for years been announcing milk prices either below or close to cost, deepening the livestock crisis. At this point, the Meat and Dairy Board's intervention in the market is limited to two practices. It attempts to balance domestic meat demand that cannot be met domestically through livestock imports, and when there is a surplus of milk in the market, it collects raw milk from producers and has milk powder produced in its name for export. However, intervention based on imports is a major blow to domestic livestock farming. The Ministry had announced that the planned import volume of beef cattle for 2026 was 500,000 head. However, with the recently announced tender for 400,000 head of live beef cattle, this limit will be approached in the first half of the year. According to figures announced by CHP MP Gürer, 739,000 head of livestock were imported last year, resulting in a foreign exchange loss of $1.191 billion. It is possible to say that this year will follow a similar trend to last year. After the record animal imports in 2018, which put hundreds of thousands of farmers in a difficult position and drove them away from livestock farming, last year's figures were the highest ever.
Turkey's livestock industry is currently in a quandary, in a vicious cycle that is increasingly consuming itself. But dairy farming is at the starting point of this cycle. In the dairy sector, dominated by giant dairy producers and chain supermarkets, these two actors set low prices for raw milk, both directly and indirectly. This, combined with the fact that milk from farms has been purchased for years at prices below cost, primarily due to feed inputs, has led to hundreds of thousands of dairy animals being sent for slaughter. When feed prices are relatively high, farmers who do not want to lose money from dairy farming send their animals to slaughter, thereby making some profit, but when the offspring of the slaughtered animal is not born, the supply of meat and/or milk decreases starting the following year. When the supply of milk and meat falls, the state steps in and tries to meet demand by importing animals, milk powder and dairy products. In order to compete with the low prices of subsidised animal products from abroad, the price of milk from farms falls. However, the price of meat, milk and dairy products in the market continues to rise. At this point, producers are harmed, leading to further disengagement from production. In subsequent years, meat and milk supply inevitably declines. This cycle repeats itself. Thus, the government's reliance on imports as a solution harms dairy farmers, livestock breeders, and dairy product manufacturers alike. Consumers also find it increasingly difficult to access these products each time.
IF A PUBLIC MODEL IS NOT ESTABLISHED, THE PEOPLE WILL LOSE EVEN MORE
Considering chronic problems such as the shrinking of pastures, food inflation, and disengagement from production, how realistic is it for Turkey to continue with the “market-centred livestock farming” paradigm it has adopted since 1980?
A structural transformation is essential for Turkish livestock farming to break out of this vicious cycle. This transformation is only possible with a public model, which necessitates a reversal of the market-oriented approach. The state must be restructured, and its capacity enhanced. Only then can a line be drawn in favour of small farmers, producers and consumers, ending corporate dominance in the agriculture and food sector. Such a restructuring requires a break from the IMF-WB-US-EU line and the approach that prioritises the profits of multinational and domestic companies, necessitating an anti-imperialist and anti-capitalist logic. Within this framework, public enterprises (KITs) should be established to dominate production and the market. Alongside establishing these KITs, which will meet farmers' input needs and eliminate their dependence on the market, institutions should be created to effectively carry out plant breeding, pasture improvement, animal breeding, veterinary services, irrigation, and rural infrastructure and superstructure services through public means. This process should be supported by a policy framework that protects forests, wetlands, pastures and rivers from being plundered by capital. Therefore, if such a public model is not established, we will witness many livestock crises. Each livestock crisis leads to the disappearance of more small-scale farming, and with each crisis, the people as a whole lose even more.
Note: This article is translated from the original article titled İlkay Öz ile söyleşi: Özelleştirme küçük çiftçiler için yıkım büyük şirketler için yüksek kar yarattı, published in BirGün newspaper on March 1, 2026.
