Iran boosts wheat stocks with local buys.
Iran boosts wheat stocks by purchasing it from local farmers by 55.2% over the previous year’s total procurement, which helped government farmlands build up their supplies during a period of rising prices that have driven up the price of flour.
According to data released by Iran’s Ministry of Industry, Mining, and Trade, the Government Trading Corporation (GTC), which is in charge of providing the country with basic necessities, bought 7.3 million tonnes of wheat in the five months starting in late March, which is typically the harvest season in Iran.
“In the first five months of [the Persian year of] 1401, about 7.3 million tonnes of wheat worth 811.1 trillion rials were purchased by the Government Trading Corporation of Iran, which is 55.2% higher in terms of quantity and 256% up in terms of value compared to the same period last year,” it said.
The cornerstone of Iran’s effort to become self-sufficient in the important staple food is the purchase of wheat at a predetermined price set by the government.
However, many wheat growers were discouraged from selling their produce to the state since the previous administration refused to increase their pricing in line with inflation rates.
As a result, in 2020 the Rouhani administration will have spent $3.8 billion importing more than 3 million tonnes of wheat.
Iran experienced a 30% shortage for the fiscal year of 2021, necessitating the import of 5–6 million tonnes of wheat, according to officials.
To put this into perspective, in 2019, when the country achieved food self-sufficiency for the fourth consecutive year, the government purchased 11.5 million tonnes of wheat from regional farmers.
Iran’s most significant crop, wheat, accounts for over half of its farmed land and 70% of its grain output.
According to estimates, the nation consumes about 15.5 million tonnes of wheat annually, but due to inconsistent domestic production, supplies have changed over time.
Since just a third of the 6.5 million hectares used for harvest are covered by irrigated wheat, the majority of the crop is dependent on seasonal precipitation, rendering yields susceptible to boom-and-bust cycles.
The prolonged violence in Ukraine, the world’s fifth-largest exporter of wheat, is posing a severe threat to the world food market. Russia exports the most wheat in the world, making up 18% of all shipments.
Russia and Ukraine, which last year produced 38 million tonnes and 22 million tonnes of the world’s wheat supply, respectively, have decreased their production by 30 million tonnes this year, which has caused prices to surge dramatically.
According to economists, the increase in the cost of energy and food goods, particularly wheat, has been accelerated by the West’s increased sanctions against Russia.
