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Short crops in Turkey and Italy and strong demand internationally and at home have combined to create an ideal market for Oregon’s record-breaking hazelnut crop and provide a much-needed lift for Willamette Valley growers.

The positive developments started in early September when growers received a robust minimum guaranteed price, and grower fortunes have risen since as prices for hazelnuts only recently plateaued after rising considerably due to expanding markets.

“This year, major buyers are taking in big quantities of U.S. varietals,” said Michael Severeid, CEO of Willamette Hazelnut.

Crop yields meanwhile soared as a record number of hazelnut acres came into production under ideal growing conditions. Industry figures now show that 96,856 acres of hazelnuts are planted in Oregon with nearly 80% of the acres bearing crop.

“We will probably be around 122,000 to 124,000 tons of hazelnuts (or 111,000 to 113,000 metric tons),” said Larry George, owner and CEO of Northwest Hazelnut Co. and George Packing Co. “So we are up about 25% [over the previous crop record of 98,000 tons set last year].”

The developments represent a huge increase in fortune for a grower base that just three years ago was getting just 42 cents per pound for certain varieties, a price well below the cost of production.

“Three years ago was pretty catastrophic,” said Steve Horning, a producer from Monroe, Ore. who is president of the Hazelnut Growers Bargaining Association. “But we pulled out of that by the next year and got into what I would characterize as ‘break-even mode.’ Last year we weren’t getting rich but it was sustainable. Now this year obviously it’s looking real good.”

“This year, major buyers are taking in big quantities of U.S. varietals.” – Michael Severeid, Willamette Hazelnut

With markets for most of the other crops in Oregon’s Willamette Valley souring, the developments in hazelnuts are particularly important he said.

“If you look at nearly every other crop in our valley right now they’re really struggling and growers are struggling,” Horning said. “And so it’s nice for the hazelnut industry to be able to step in and prop up this valley.”

“It’s a big deal right now to have at least one crop be profitable,” said Greg Riches, CEO and partner in Cascade Foods, a hazelnut packer in Albany, Ore. “I don’t think you could argue the fact that hazelnuts are the shining star of all the crops being grown in the Willamette Valley right now.”

Minimum Price
The year’s developments started on a high note when growers and packers established the guaranteed minimum price at $1.05 to $1.30 per pound, 40% higher than last year’s minimum of between 75 and 90 cents per pound. From there, prices reportedly rose steadily until plateauing in mid-October.

“[The price] is adjusting down but I don’t think it’s going to fall a whole lot just because there’s a fundamental need that is driving the market,” Severeid said.

Last year’s final field price notably was 40% higher than the minimum guaranteed price which, if that were to happen again, would push this year’s final field price into the $1.80-per-pound range for certain varieties or record levels.

The biggest factors driving up prices according to industry sources were developments in Turkey where 60% to 65% of the global supply of hazelnuts is annually produced and where a devastating freeze in mid-April and drought later in the season severely damaged the crop. Additionally, high stink bug pressure contributed to low kernel yields, prompting Turkish growers to significantly raise their asking price.

“Right now, Turkish farmers are asking for between $8 and $9.50 per pound on kernels (more than twice what they were asking for last year), and what we’re seeing is users that have traditionally used hazelnuts and new users are not interested in paying that,” George said. “As a result, it completely froze the Turkey market. And so people who had never used an Oregon hazelnut before because they always bought from Turkey all of a sudden are calling Oregon processors, and we’ve been able to move the Oregon crop at extremely attractive prices.”

Global supply also is feeling the effects of the poor crop in Italy where, like in Turkey, yields were down because of a freeze and damage from stink bugs. The developments in Italy mean that the U.S. again, like in 2024, is poised to be the second-leading hazelnut producer, a development that George believes could change in 2026 as more acres come on in Chile.

“In 2026, it is very likely that Chile will pass us,” George said.

Far-Reaching Effects
Severeid added that this year’s market developments could have far-reaching effects. “Long-term, what’s happening is huge because it means we’re in these major chocolate plants in Europe,” Severeid said. “We have expanded our customer base and people through the supply chain will witness the quality difference we bring to the market.”

George agreed. “We produce a higher-quality product because we don’t have as many issues with stink bug damage as they do in Italy and Turkey,” George said. “And they have ongoing supply chain handling issues. They get a lot more rancidity than we do.

“So we are an incredibly attractive market for buyers looking for an alternative source of hazelnuts,” George said.

One big question going forward, according to George, is whether Oregon’s foray into these new markets will continue to expand under the weight of this year’s high prices.

“There is a lot of new consumption going on in Europe and the United States,” George said. “So that’s exciting. The question is going to be are these prices so high this year that are we going to do long-term damage to the market growth? We’re hoping that by Oregon having super-high quality, being more reasonable in how we address the market and being really supportive of the customers that have already supported us that we are able to buffer any long-term negative effects of this temporary price spike.”

Sean Denfeld, of Denfeld Packing in Hillsboro, echoed George’s concerns.

“Short-term, the benefit of the likely record-breaking prices for Oregon growers is much needed,” Denfeld said. “But I think this all needs to be taken into context in regard to how much market damage and destruction this is causing with discretionary consumers.

“In the bigger picture, we must remain aware of the discretionary consumption market disruption that is happening right now,” Denfeld said. “But I don’t want to understate the importance of this short-term benefit.”