The Ottoman State was organized as a political structure that kept central control of the large territories over which it had established dominance. This was true in all of the administrative, financial and economic realms. The food supply of Istanbul, the capital city, played a crucial role in ensuring administrative and economic control of the Ottoman territory, and as a result, was of special interest to the central administration. The need for grain, which was quite significant in Istanbul, was supplied entirely by kapan merchants;1 these merchants had semi-official and semi-private status until the nineteenth century. Starting from the second half of the eighteenth century, however, and particularly during the winter months, the food supplied by kapan merchants grew insufficient; the state was forced to take a direct role in the sector. This development initially began as a safeguard, with the storage of grain purchases in limited amounts, which would then be distributed to Istanbul bakeries in case of shortages. This resulted in the establishment of the Zahire Nezareti (Ministry of Grains) at the end of the century; this had a separate staff and monetary reserves.
An important aspect of the ministry’s work was regulating the activities of the kapan merchants and supporting them. The Zahire Nezareti helped the kapan merchants find cheap and abundant products in the areas they were active in and took the necessary precautions to ensure purchased goods could be brought to Istanbul. In particular, the ministry tried to prevent grain smuggling and endeavored to create an abundant demand for the goods. Additionally, the ministry played the role of arbitrator between merchants and producers, overseeing the bargaining of prices. The ministry also regulated the navigation of vessels transporting grains to Istanbul.
Apart from assisting the kapan merchants, the primary function of the Zahire Nezareti was to purchase goods on direct behalf of the state, accumulate purchases in miri (state) storehouses, and distribute the same in times of need to bakeries around Istanbul. Moreover, the Zahire Nezareti would occasionally purchase from the wholesale market hall (kapan) at free market prices, just like a kapan merchant; these purchases would result from bargaining between the grain minister and merchant. However, a large part of such purchases was done according to official prices. The Ministry of Grains utilized two contrasting purchasing methods in terms of the quality of their purchases and their economic consequences. Those two methods were known as miri (state) and rayiç (market value), and each followed distinct historical developments.
Unlike the rayiç purchasing method, which was applied after the establishment of the Zahire Nezareti, the start of the miri method dates to earlier times. Previously, miri purchasing was used only for military purposes. Towards the second half of the eighteenth century, this method began to feature in Istanbul’s food sector. In this method, which was used mostly in the Rumelia region, amounts of grain were allocated (or as referred to at that time, “arranged”) according to the production capacity of a region. With an edict that was sent to every township, the public was notified about the arranged amount of grain and were asked to submit specific amounts to purchasing agents who had been appointed by the state. In miri purchasing, customers typically paid 20 pare (units of money) for wheat and 10 pare for barley. These prices, which were set in the beginning of the second half of the eightenth century, did not change for approximately a century. For this reason, prices paid to producers were impossible to compare with market prices and were thus largely symbolic. These prices increased to 100 pare for wheat and 50 pare for barley (a five-fold increase) in the 1830s, however these rates were still lower than the market prices.
Due to a fiscal autonomy principle within Ottoman financial management, taxes were left to the people or, more typically, the administrators of townships. This was also a valid principle for the issue of miri purchasing. The central government was satisfied, however, to merely define each township’s total amount of liability. Nevertheless, both Muslim magistrates and landed proprietors distributed this amount throughout each township according to the ‘situation and endurance’ of every individual, taking into further account the number of couples found on magisterial records in distinct villages and districts.
In order to prevent injustices caused by the miri purchasing system, the rayiç purchasing method was introduced at the end of the eighteenth century as part of the Nizam-ı Cedid movement. Compared to the miri purchasing system, the rayiç system was distinct in character, mainly in terms of purchase prices. In the rayiç purchasing system, purchasing figures were essentially based on fair market prices. In practice, however, the rayiç purchasing price did not often reflect actual market prices. When the rayiç purchasing system was first introduced, the price, referred to as rayiç-i mutedile (equal market value), was set very close to the market value. However, over the course of time, this price soon lagged behind market prices.
The rayiç purchasing was distributed using the dispensation method between townships, just as the miri purchasing system had been. Unlike the miri purchasing system, however, the rayiç was not dispensed as a tax among the people in a township. Instead, it was demanded from producers, farm and warehouse owners, and taxmen who kept grains as an income of the öşür (Islamic tithe).
With the end of the Nizam-ı Cedid period, the rayiç purchasing system was removed and the miri purchasing system was once again installed. The reason for the removal of the rayiç purchasing system, as stated in the official resolution was that the fiscal burden incurred from the purchasing should belong only to producers and grain owners, and those who did not have grains but were economically strong should be excluded from financial liability. In practice, however, the rayiç purchasing continued to exist alongside the miri purchasing after this point in time; both of these systems were utilized for Istanbul’s food supply. According to this system, regions would determine the amounts of grain they would purchase under rayiç and miri prices, utilizing the dispensation method as well. Among the factors that were arranged centrally were the distribution and allocation of grains between townships, the location of the pier at which every town would deliver its product, and individual actors in the purchasing sector.
In a sense, the miri purchasing system was a form of taxation. For this reason, tax exemptions that had been granted to certain groups were also valid for miri purchasing. This was primarily the case for foundations and has köyler (imperial domain). However, because the rayiç purchasing system was an ivaz (state benefit), exemption claims for purchases typically did not apply.
For both miri and rayiç purchasing, it was necessary for products to be charged with consistency. In cases where items were not charged identically for any valid reason, they would be transferred according to rate. Prices that were fixed while being transferred to rate were quite a bit higher than those set for purchasing. With this adjustment, the state was able to reclaim losses in the treasury caused by its inability to collect products. This was because the price of grains in the markets was well above those in the rayiç and miri purchasing systems.
Officials working in administrative centers and influential figures in each region, such as the land owners or the mütesellim (deputies), were typically appointed as purchasers. In return for necessary expenditures, purchasers received cash payments in advance from the Zahire Nezareti. Similar to kapan merchants, purchasers distributed portions of this payment to farm owners or farmers as credit under, known as orakçı (reapers’) akçesi, in return for future shipments of grains. Purchasers would keep for themselves one bushel of grain out of every ten as their share of production, and by bringing their share to Istanbul and selling them in the kapan they were able to make significant personal gains.
Both the miri and the rayiç purchasing system led to a great deal of corruption. Those who were appointed as purchasers often committed injustices to the public. Among their acts of discrimination were practices and figures referred to as the kolcu akçesi (guard’s coin) and tuzluk (salt cellar) and yazıcı (clerk) and keyyal ücretleri (bushel weigher prices). Purchasers measured grains with fraudulent bushels, asked for money instead of products, and did not pay for shipments of grain upon delivery. In the place of the grain they were meant to provide, they provided mixed and low-quality grain to the state. They also committed injustices in the distribution of pre-arranged amounts of grains among local people in the townships. As a case in point, local powerful figures and wealthy farm owners often charged their shares to small farmers.
After arriving in Istanbul, grains were immediately stored in either local warehouses or miri warehouses in the Ottoman Imperial Shipyard. These grains were used depending on demand to provision both the military and Istanbul. In the winter months, when grains did not arrive at the kapan, grains were distributed to city bakers from the Shipyard’s warehouses in accordance with a decision of the Istanbul qadi.
The combined practice of rayiç and miri purchasing systems lasted until the 1830s. At that time, the rayiç purchasing system was eliminated. Officials also wrote off public debts as the miri purchasing system alone came into use in 1828. Officials decided that debts were to be collected and used for the military bouche. As part of the Tanzimat reforms, the miri purchasing system was completely abolished in 1839. The food supply of Istanbul was thus left entirely to free market conditions.
Until the end of the eighteenth century, the food supply of an enormous city like Istanbul, whose population at this time was close to half a million, was provided by kapan merchants with the support of the state. However, kapan merchants were insufficient in supplying the city with the necessary amounts of food as a part of their own financial affairs, and this led to the foundation of the Zahire Nezareti. Serving as an economic state enterprise in the modern sense, the Zahire Nezareti undertook a series of actions that included purchasing and storing grain locally, providing Istanbul with an adequate food supply, transporting food to the center and distributing it.
The Zahire Nezareti was distinguished above and beyond its larger-scale activities, which were already being carried out by the private sector on a smaller scale. The Zahire Nezareti did not act as an ordinary purchaser; it intervened substantially in market mechanisms through particular price policies and followed a policy that affected income redistribution among a large section of the people. The purchases made by the Zahire Nezareti included implicit taxation due to low prices, which led to an income transfer from rural to urban areas, ultimately favoring the people of Istanbul and the state. This policy helped the state become successful in limiting price increases in grains in the Istanbul market. Additionally, it established the possibility of finding cheaper supplies in order to feed its officers and soldiers. This was not the only factor in the equation, however. In terms of the producers who bore financial burdens as a result of such practices, purchases negatively impacted their enthusiasm for production, ultimately preventing the market from developing and resulting in limited agricultural production.
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Güçer, Lütfi, “XVII. Yüzyıl Ortalarında İstanbul’un İaşesi İçin Lüzumlu Hububatın Temini Meselesi”, İFM, , vol. 11, no. 1–4 (1949-1950), pp. 397–416.
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1 Kapan tüccarı [literally wholesale market hall merchants] were powerful merchants who had large ships carrying all sorts of grains.