The purpose of the article is to justify conditions for the saturation of the domestic hazelnut market and export development, to study conditions of the domestic market, to outline problems and prospects for hazelnut production, and to propose a number of measures for competitive development of this industry. Research methods. The theoretical and methodological basis of the research was modern economic theory and scientific provisions on the development of food markets. In particular, the following scientific methods were used: analysis and synthesis, grouping, balance sheet (for evaluating the status of the hazelnut market); calculation and normative methods (for establishing perspective production volumes); modelling and comparative analysis (for substantiation of bases for effective development of the industry). Research results. Current state and tendencies of demand and supply formation were investigated, and a level of nuts production and consumption was estimated. Cost standards for the creation and usage of hazelnut orchards were substantiated, and investment needs for the development of the domestic industry and expected socio-economic effect were calculated. Elements of scientific novelty. Methodological approaches to the calculation of the food balance were deepened in the research on capacity of the domestic hazelnuts market, namely enlarged articles in accordance with the product segmentation of fresh and processed products market. Practical significance. Practical significance of the obtained results lies in establishment of quantitative and qualitative parameters of hazelnut production, determination of capacity of the domestic market, evaluation of efficiency of industrial technologies, and elaboration of measures for the development of the industry. Planting of five thousand hectares of industrial hazelnut orchards in Ukraine will increase a level of these nuts production to 0.4 kilogram per person considering the fact that current consumption of all types of nuts is 0.8 kilogram. This will facilitate the substitution of hazelnuts in the domestic market and development of its export. Tabl.: 2. Figs.: 2. Refs.: 15