BLOG

Doruk Un to invest $50 million over 5 years

21 August 20249 min reading

Doruk Un will also activate its warehouse investment for 20,000 tons of factory silo capacity this year. Aiming to invest $50 million over five years, the company will also focus on innovative and value-added product groups such as gluten-free flour and noodle production, alongside investments in storage and logistics. 

Gürsel Erbap

In Türkiye, where temperatures have been above seasonal averages, the grain harvest began earlier this year compared to previous years. Wheat and barley harvesting is 60% complete nationwide. According to the Ministry of Agriculture, approximately 30 million tons of wheat and barley production is expected this season. To observe the ongoing harvest and industry activities, we had the opportunity to visit Doruk Un’s factory in Tekirdağ, where wheat harvest is nearing completion. During a press conference, Gürsel Erbap, Chairman and CEO of Doruk Un, discussed wheat production, yield, and the issues facing the industry. 

In 2023, Doruk Un set a record with a 100% increase in revenue in Turkish lira (TRY), reaching 8.14 billion TRY, and a 35% increase in USD terms, totaling 329 million dollars. The company is continuing its rapid growth into 2024 with plans for new investments. This year, Doruk Un invested a total of 8.5 million TRY in R&D, launching its healthy flour portfolio with the retail brand PanPan. In the first six months of 2024, the company achieved an 11% increase in export markets and a 44% increase in domestic market tonnage. Doruk Un aims for at least a 30% growth in the retail market by the end of the year. With an annual wheat milling capacity of 438,000 tons and a flour production capacity of 350,000 tons, Doruk Un is one of Türkiye’s largest flour exporters, utilizing 65-70% of its capacity for export and serving 41 countries. Doruk Un develops products tailored to a wide range of needs and uses, from home use to bakeries, restaurants, and hotels. As the only flour producer with its own seed development, Doruk Un aims for over a 50% increase in tonnage in the domestic market with its retail brand Panpan in 2024. The company also targets significant growth in the sector through its seed investments, and after approximately three years of R&D, it plans to introduce five varieties of certified seeds to producers during the 2024 harvest season. 

PanPan targets 50,000 tons annual production in packaged flour category

With a focus on achieving the right taste with the right flour, Doruk Un, having entered the retail market with its PanPan Flour brand through its investment in packaged flour, showcases a pioneering vision in the sector by offering high-quality, suitable, and delicious flour options. Introducing three different products rich in fiber and highly nutritious, derived from local heritage seeds, Doruk Un has established the ‘Healthy Flour’ category in Türkiye’ for the first time. The company plans to add gluten-free flour to its product range soon, aiming to expand in the branded and packaged flour market. Doruk Un, aiming to become Türkiye’s leading brand in the packaged flour market by establishing strong penetration across online channels and all major supermarkets, positions itself in all categories of the value chain from field to table. Doruk Un aims for 10% of its consumer product group revenue and 20% of its profitability to come from the ‘Healthy Products’ portfolio through the PanPan brand. In the packaged flour category, PanPan aims to reach an annual tonnage of over 50,000 tons within five years, becoming one of Türkiye’s top three packaged flour brands.

First goal: Producing noodle

Doruk Un will activate an investment in warehouse infrastructure to increase its factory silo capacity by 20,000 tons this year. The company plans to invest $50 million over the next five years, introducing innovations and value-added product groups such as gluten-free flour, noodle production, storage, and logistics investments. Doruk Un also aims to invest in production, R&D, frozen baked goods production and retail, logistics and storage, new product development, and sustainability in agriculture and food projects.

Wheat yields in Marmara Region expected to increase by 10-15%

Supporting production to reduce foreign dependency and aiming for value-added exports with products made in Türkiye, Doruk Un has a significant advantage with its proximity to products and ports in Tekirdağ province. The company operates an advanced 20,000 m² production facility equipped with cutting-edge technology, producing 350,000 tons of flour annually. Doruk Un CEO highlighted the importance of the Marmara Region and Thrace lands for Türkiye’s wheat harvest in terms of planting area and yield: “The Marmara Region accounts for 15-16% of Türkiye’s wheat planting areas and approximately 21% of production. Additionally, the region’s average wheat yield (350-400 kg/da) is about 40% higher than the national average (250-300 kg/da). These statistics clearly demonstrate the importance of wheat farming for the region. With an annual rainfall average of approximately 585 mm, the climate and soil characteristics are suitable for cereal farming, leading to high yields and, consequently, high income. This underscores the significance of bread wheat farming for the region.”

Erbap emphasized that wheat yield in the Marmara Region has remained steady for many years and that a 10% increase is expected compared to 2023. He stated, “The most crucial factor for wheat productivity is receiving rainfall during the planting season. This year, due to the drought during the planting season followed by excessive rainfall, preparation for planting could not be completed in some local areas of the Marmara Region. As a result, planting was reduced in certain areas. However, due to favorable rainfall during the critical periods of pollination and grain filling in the fields where planting was done, a 10-15% increase in yield is expected.”

Doruk Tohumculuk’s seeds yield three times more wheat

Doruk Un, anticipating that ‘food supply’ will be the greatest challenge for countries in the future due to wars and climate change, has initiated sustainable agriculture and certified seed projects. In Türkiye, a country with a strong agricultural base, Doruk Un is working to increase planting areas and productivity. The company is focusing on high-yield, sustainable varieties to enhance efficiency and ensure long-term agricultural viability. Doruk Un Chairman and CEO Gürsel Erbap, stating that the future will belong to companies investing in sustainable food supply, emphasized, “With the right agricultural policies and production approaches focused on efficiency, Türkiye could achieve wheat exports without imports within two years. Building on this, under the umbrella of its subsidiary Doruk Tohumculuk, Doruk Un is developing nearly 80 different seeds, including wheat, barley, oats, corn, sunflower, and lupine, across eight sites—three in the Marmara region and five in Central and Southeastern Anatolia. Our wheat varieties yield three times more than the national average in Türkiye and surpass the average protein content, a key quality parameter, by approximately 25%. As a result of our R&D efforts, we aim to introduce five varieties of certified seeds to producers for the 2024 planting season. With these high-efficiency seeds, Doruk Tohumculuk aims to establish a strong presence in the industry. Our primary goal is to ensure that producers achieve maximum yield on the same agricultural land. Given the serious food crisis due to climate change and the ongoing reduction in agricultural land, this crisis is expected to deepen in the coming years. Therefore, achieving maximum yield from agricultural land is the most critical issue for today and the future. Since agricultural land will not increase, enhancing productivity, integrating production with technology, and raising awareness among farmers and producers have to be the sector’s most important focus. With this vision, our ‘Seeds for the Future’ initiative hosts awareness campaigns each year in different regions about the significance of certified seeds and agricultural activities. Through these efforts, we aim to elevate our national treasure, agriculture, and certified seeds to their deserved value.”

Preparing to share drought-resistant seed varieties with farmers

Erbap highlighted that, as with all plant production, one of the most important factors affecting yield in wheat cultivation is the choice of variety. He emphasized the importance of planting based on ecological suitability and the yield level of the variety, stating, “In the Thrace region, it is essential to select varieties that are resistant to winter and drought for a productive harvest. It is important to ensure that the product’s genetic structure and its height are appropriate for the soil. In our region, more than 150 wheat varieties are planted. Due to the large number of varieties, healthy wheat production is not feasible, and there is a yield loss in the region because seeds that are resistant to new diseases have not been used. Therefore, it is crucial to focus on varieties with high adaptation capabilities. In our R&D efforts at Doruk Tohumculuk, we have developed varieties with high yield and quality that are resistant to drought, diseases, and pests. We are preparing to share these seed varieties with our farmers soon.”

Flour manufacturers sacrifice profitability to maintain global leadership

“Türkiye is expected to enter the 2024 harvest year with a 10% to 15% increase in wheat yield compared to the previous year. Due to the large stock held by the Turkish Grain Board and the high yield of the ongoing harvest, wheat imports have been banned between June 21 and October 15. Manufacturers wishing to export can source wheat from the domestic market and either process it within the scope of inward processing or directly export flour and wheat. Türkiye ranks first among the world’s largest wheat exporters, followed by Uzbekistan, Kazakhstan, Argentina, and Russia. In 2023, Türkiye achieved 3 million 656 thousand tons of flour exports. In the first 4 months of 2024, 1,295 thousand tons of flour have been exported, and the flour sector expects to reach 4 million tons of flour exports by the end of 2024. Flour producers, who have been leaders in global flour trade for many years, will reassess this situation and strive to adapt to the market,” Gürsel Erbap said. “Flour producers, who import wheat from Black Sea countries like Russia and Ukraine and export to over 130 countries, are sacrificing profitability due to energy costs, logistics expenses, and recent labor costs in order to maintain their growth and leadership in the competitive market. For Türkiye to advance its agriculture in the coming period, it needs to redesign its product patterns according to regional and climate conditions and prepare for the future by adopting sustainable agriculture practices.”

Tags
#Doruk Un
Articles in Special Story Category