A total of 6.2 million tons of wheat were imported into Iran during the current fiscal year’s first 11 months (March 21, 2021-Feb. 19), according to director general of Sales and Distribution Coordination Department of the Government Trading Corporation.
“This year, the government bought around 4.5 million tons of the staple grain from local farmers as part of its guaranteed purchase plan. As domestic consumption of wheat was estimate to rise over 11 million tons this year, the deficit had to be imported,” Hojjat Baratali was also quoted as saying by IRNA.
In the last Iranian year (March 2020-21), he added, 10.5 million tons of wheat were consumed in Iran.
Wheat, considered an essential commodity, is imported using subsidized foreign currency (at the rate of 42,000 rials per dollar). Also known as necessity or basic goods, essential goods are products consumers will buy, regardless of changes in income levels.
According to Mohammad Reza Mortazavi, the head of the Federation of Iranian Foodstuff Associations, this year’s wheat production stood close to 5 million tons.
“Drought and water shortage hit after a few years of self-sufficiency. What made matters worse is that the grain, due to its relative low price compared with other animal feed, has been used in livestock and poultry farms,” he added.
The official said the country needs to store at least 3 million tons of wheat for its strategic reserves every year when production is normal, but the figure has to increase to 5 million tons at times when the harvest is hit by drought or other factors.
“Global wheat prices have reached their highest in the past five years. Grains in general experienced an 80% price rise at times. Russia, the US, Canada, Australia, Argentina, Germany and France are the world’s top wheat producers and Egypt, Iraq and China are the biggest importers,” he said.
Russia is Iran’s main wheat supplier, followed by Germany and some Eastern European countries.
*** Largest Grain Importer From Russia
Iran became Russia's largest grain importer, importing 3.7 million tons of grain in the agricultural year from July 1, 2021, to June 30, 2022, according to analytical company Prozerno.
"For the first three months of the new season 2021-22, exports to Iran from Russia amounted to 3.697 million tons of grain, including 3.091 million tons of wheat, 392,600 tons of barley and 215,300 tons of corn. Thus, Iran reached first place not only among the importers of Russian wheat and corn but also in the overall standings for all grain types," the statement said.
Experts estimate that Turkey purchased 3.523 million tons of Russian grain, including 2.87 million tons of wheat, 569,200 tons of barley and 73,100 tons of corn. Egypt came in third place with 1.69 million tons of wheat, TASS reported.
The Russian Ministry of Agriculture reported earlier that grain exports in the 2021-22 agricultural year decreased by 21.3% and amounted to 13 million tons as of Oct. 14. At the same time, the volume of wheat exports for the season decreased by 18% and amounted to 11.1 million tons, barley by 34.9% to 1.5 million tons and corn by 56.5% to 0.2 million tons. According to the forecast of the Russian Agriculture Ministry, for the current agricultural year, grain exports may amount to 45-48 million tons. Agricultural exports from Russia amounted to 48 million tons in 2020-21, including 38.4 million tons of wheat.
Egypt, Iran and Sudan will together receive two-thirds of the 917,000 tons of wheat loaded from Russia’s main port of Novorossiisk onto ships that arrived between Jan. 9 and Jan. 31, according to the most recent data from the port’s three grain terminals.
The data supplied by port agents Global Ocean Service Ltd. showed that Iran is due to receive 227,000 tons of wheat, Sudan will receive 205,000 tons and Egypt will get 189,000 tons.
They also include a 19,650-ton shipment for Cuba, which traders say will be the country’s second Russian purchase this marketing year (July 2021-June 2022), after it bought 23,000 tons in October. A market source said the Caribbean island didn’t take any wheat from Russia in the previous marketing year.
Novorossiisk has three main grains terminals, NKHP, NZT and KSK. The first two of these have a combined annual capacity of 13.6 million tons and are controlled by Demetra Holding, a grains business that’s part of VTB, a state-controlled Russian bank. KSK is privately owned. In addition to its shipments from Novorossiisk, Russia also exports wheat through the neighboring deep-sea ports of Kavkaz, Tuapse and Taman.
In its most recent report, the US Department of Agriculture estimated that Russian wheat exports for the 2021-22 marketing year would total 35 million tons, down from 38 million tons in the previous year. The fall reflects a decline in the country’s production to 76 million tons from 85 million tons, based on USDA figures.
*** German Wheat Exports Boosted by Iran
Euronext wheat futures ended narrowly mixed on Wednesday as widely followed US government crop forecasts brought few surprises, Reuters reported.
A rise in the euro capped Euronext, underscoring concerns about short-term European exports, although a run of shipments to Iran was boosting export sentiment in Germany, traders said.
March wheat on Paris-based Euronext settled down 1.75 euros, or 0.7%, at €262.75 ($300.64) a ton. Further-away delivery positions closed flat to slightly higher.
Euronext was curbed in late trading as Chicago wheat gave up earlier gains, following the US Department of Agriculture's world supply and demand report.
The USDA pegged US wheat stocks this season above the average trade expectations, although its world wheat stocks forecast was slightly below mean trade estimates.
The March contract on Euronext has recovered from last Thursday's four-month low of €259.00, but has remained curbed by worries about lagging French exports.
In Germany, traders highlighted more loadings for Iran, an active importer this season.
"One ship is currently loading 65,000 tons of wheat in Germany for Iran," a German trader said. "Two more vessels are scheduled to start loading wheat for Iran in Germany in the coming days, one 65,000 tons and one 67,000 tons."
Shipments to Iran could give fresh impetus to Germany's export campaign after strong sales to Algeria earlier in the seasons.
"Iran is shaping up to be a large buyer of German wheat this year, despite heavy competition for sales from Russia, and may overtake Algeria as Germany's largest export customer in coming months," the trader added.
Financial investors trimmed their net long position in Euronext's wheat futures and options last week, data released by the exchange on Wednesday showed.
