Iran’s share of Iraq’s 2-million-ton annual flour market stands at 320,000 tons or 16%, the chairman of Kermanshah Chamber of Commerce, Industries, Mines and Agriculture said.
Keyvan Kashefi added that the western Iranian province bordering Iraq accounts for 24,000 tons of Iran’s total exports of the product to the neighboring country.
“Kermanshah has 14 active flour factories with a capacity to produce 678,000 tons per year. These are currently working at 50% of their full capacity. We also have two dormant factories with a combined capacity to produce 78,000 tons. These can also become operational, if we try to meet a bigger portion of the demand in the Iraqi market,” the official was quoted by the news portal of Iran Chamber of Commerce, Industries, Mines and Agriculture as saying.
Kashefi noted that at present, flour is priced at $290 per ton in Iraq.
“Kermanshah produces 617,000 tons of wheat per year. About 377,000 tons of this exceed the province’s annual demand, therefore we can make plans to be a bigger supplier in Iraq’s flour market,” he said.
Iran has been self-sufficient in wheat production for two years now and only imports the crop for reexportation after it is processed.
The country agreed to buy the grain from Russia and Kazakhstan earlier this year to be used to make flour for exports.
“There is unused capacity at Iran’s flour mills,” Kaveh Zargaran, chairman of the Agriculture Committee of Tehran Chamber of Commerce, Industries, Mines and Agriculture, said in an interview with Bloomberg in Moscow.
"Total shipments may reach as much as 1 million tons a year over the next five years."
Russian Energy Minister Alexander Novak, who oversees trade with Iran, has said he expects sales to Iran to reach 1.5 million tons a year.
“Iran signed a memorandum of understanding with Russia and Kazakhstan on March 4, which laid out details of the trade,” Zargaran said.
“The agreement leaves in place a ban on the import of wheat for domestic use, which is designed to support local farmers.”
Iran has been encouraging flour exports, with the government amending market rules last year and targeting more sales to places like Iraq and Afghanistan.
“Turkey, the second-biggest buyer of Russian wheat, now dominates Iraq’s market,” Zargaran said.
Latest data from the Islamic Republic of Iran Customs Administration show Iran exported 81,638 tons of wheat flour worth $20 million during the first four months of the current fiscal year (March 21-July 22).
Iraq, Afghanistan, Qatar and Germany were the main customers of Iranian wheat flour during the period.
