Ismayil, the Hazelnut Hero of Azerbaijan
With USAID’s help, one farmer united a community and transformed a local staple into a profitable enterprise
Ismayil Orujov is from Zaqatala, a district in northwestern Azerbaijan along the border with Georgia and Russia. He comes from an enterprising farming family.
While his father was one of the biggest tobacco producers in the district, Ismayil’s ambition drove him to explore new ways of doing business. In the early years of Azerbaijan’s independence from the Soviet Union, his neighbors began planting multi-trunked trees that produced findik, those round, crunchy, fatty nuts that the world knows as hazelnuts. Unlike tobacco which is highly labor intensive, hazelnuts are relatively easy to cultivate.
Azerbaijan also has a strong domestic demand for hazelnuts. They are a staple ingredient in many traditional Azerbaijani sweets, including pakhlava and shekerbura. People in Zaqatala were starting to grow hazelnuts in large quantities, but the systems to process them for sale in grocery stores and markets did not yet exist.
Ismayil came to his father with an idea to transform the family tobacco fermentation facility into a hazelnut processing plant. In 2005, he traveled to Turkey, a world leader in hazelnut production and export, to seek advice. He returned with some basic equipment and in six months his new hazelnut business was off and running.
“Neither I nor anyone in my family had much production experience or market information on hazelnuts. I began running my business through trial and error,” recalls Ismayil of the early days of his business.
Despite some ups and downs, Ismayil managed to grow his business and even started exporting to limited markets abroad.
By 2015, he had developed a good reputation as a small local supplier, but he wanted to expand further. Ismayil introduced himself to agricultural experts working for a USAID project in northern Azerbaijan.
With their help, he founded the Azerbaijan Hazelnut Exporters Consortium with neighboring local hazelnut processors across northern Azerbaijan. By pooling their resources, they could invest in building their brand internationally and buy enough hazelnuts from local farmers to decrease the normally exorbitant shipping costs. USAID also helped them attend international food conferences to market their product and get the international food safety certifications required to export to certain markets abroad.
These moderate successes were positive in the short term, but Ismayil predicted greater challenges to his long-term vision of transforming Azerbaijan’s hazelnut industry into an internationally-recognized brand.
The first was on the supply side. In order to expand, they needed an even larger supply of high quality hazelnuts. Hazelnut trees are now ubiquitous in northern Azerbaijan. Most people have them in their backyards. But, in a place where most of the hazelnuts are produced from family gardens, rather than industrial farms, size and quality is not consistent.
The second problem they faced was profitability. The majority of Azerbaijan’s hazelnut exports were still going to Russia, Azerbaijan’s northern neighbor, where hazelnut prices were very low.
The lack of access to potential customers outside of Azerbaijan and Russia left their businesses, and the farmers who depended on them, vulnerable to changes in demand and fluctuating prices in the Russian market.
Ismayil realized that the consortium could not solve these problems on their own. In 2016, with support from USAID, Ismayil helped to unite local gardeners, farmers, and agribusiness owners of all sizes to form the Azerbaijan Hazelnut Producers and Exporters Association, one of the first agribusiness organizations to be registered in Azerbaijan.
USAID helped the association build a training facility and demonstration plots, which it uses to teach pest management and good agricultural practices to local farmers, many of whom are harvesting hazelnuts from trees in their backyards and have little to no formal training as farmers.
Last spring, with investment from USAID, the association opened an agricultural service center which offers the first American AGCO Valtra tractor services available to local farmers. For a small membership fee, the center provides small- and medium-holder farmers access to state-of-the-art equipment run by trained professionals, a service that usually only large-scale farming operations are able to afford.
Working in partnership with experts from USAID, the association helped the government simplify export of Azerbaijani hazelnuts.
Today, the majority of Azerbaijani hazelnuts are going to new, more lucrative markets in the Middle East and Europe. This means more reliable profits for everyone along the production chain — from the farmer growing hazelnuts in her backyard to Ismayil, who packages the hazelnuts for their long journey to grocery stores across the region.
“I am proud to represent my country with a quality product from Azerbaijan that now goes to over 25 countries. I am privileged to contribute to the diversification of the economy and at the same time be able to employ my neighbors so they can provide for their families,” says Ismayil.
USAID’s investment in Ismayil’s ambition is a clear example of how partnerships with entrepreneurs can produce results that ripple across a community and generate a positive boost to a country’s development journey.
Ismayil’s dreams for Azerbaijan’s hazelnuts continue. Given the way that hazelnuts are grown in Azerbaijan, Ismayil believes they have the potential to be certified as an organic product. His goal is for the association to get international organic certification for member farms in the next two years. The certification will further build the reputation and brand of Azerbaijani hazelnuts abroad and allow them to sell their nuts for premium organic prices, boosting profits for all the association members and their employees.
Ismayil’s drive continues to push him, and Azerbaijan, forward.
Ismayil’s story is a microcosm of the many ambitious agribusiness entrepreneurs in Azerbaijan who are diversifying Azerbaijan’s economy, making it easier to do business, and are actively seeking American equipment and investment.
About the Authors
Erin Garnett is a Development Assistance Specialist and Vugar Naghiyev is a Communications Specialist at USAID’s mission in Azerbaijan.
Together with the United States-Azerbaijan Chamber of Commerce (USACC), the Oklahoma Department of Agriculture Food and Forestry, and the Oklahoma Department of Commerce, USAID organized the first Oklahoma-Azerbaijan Agriculture Forum for Nov. 6–8. This forum is one in a series of events across the United States to forge new connections between U.S. and Azerbaijani agribusinesses. If you are interested in learning more about the forum and how to RSVP, please visit https://www.agroforum.us/.
