Abstract for: Olive Oil Industry Dynamics: The Case of Turkey

Turkey is one of the top five olive oil producers of the world. In recent years, consumer prices for olive oil have unexpectedly and dramatically increased despite the decreasing producer prices. Additionally, the benchmarking study conducted for Turkish olive oil value chain shows that there is a ``share of value'' gap among the value chain participants. These symptoms indicate that the economical sustainability of olive oil industry in Turkey is in question. In this study, taking the case of olive and olive oil, we focus on the complicated structure of the agricultural industry dynamics. Our research objectives are to understand and explain how value emerges as a result of agricultural industry dynamics, to investigate the effect of speculative dynamics and inventories in agricultural industries, and to make policy analysis and recommendations in order to maintain the economical sustainability of Turkish Olive Oil Industry. A System Dynamics model which includes both the supply chain and the value chain structures of the industry is constructed. The initial results are found to be in compliance with real world observations. The future work will include the completion of model validation, scenario and policy analyses.