The private sector has been allowed to place orders for wheat imports as of Aug. 23 after a gap of seven years, according to the head of the Agriculture and Food Processing Commission of Tehran Chamber of Commerce, Industries, Mines and Agriculture.
“In a meeting with first vice president around three months ago, we requested that the private sector be allowed to undertake wheat imports. Fortunately, our request was accepted and later the government’s Economic Council agreed to give us the permit. Now a directive allowing private businesses to import different types of wheat has been communicated to provinces across the country,” Kaveh Zargaran was also quoted as saying by the news portal of TCCIM.
The official noted that every year domestic wheat harvest ends in September, so the grain’s import cannot hurt local farmers at this time.
“The government has announced that so far it has purchased around 7 million tons of wheat from local farmers as part of its guaranteed purchase plan. Since domestic demand is close to 12 million tons per year, we still need 5 million tons of the staple grain to meet our needs. Part of this deficit has already been imported by the Government Trading Corporation but there is still room for the private sector to import,” he said.
GTC, affiliated with the Agriculture Ministry, is the lever for enforcing market controls and in charge of maintaining a supply of wheat, rice, cooking oil, sugar and meat for the country’s strategic reserve of essential goods.
Considered a staple in Iran, wheat is purchased every crop year by the government to build up its reserves and supply the market over time.
Zargaran noted that given the global wheat prices, which are currently relatively high, and the abundance of local production, import does not seem to be a good idea at present, but we are planning to import during the second half of the year (starting Sept. 23).
“At present, imports of durum wheat, or very high quality wheat that is used for making specific products or mixed with other types of wheat can be profitable for the private sector as well as bakery businesses and the industry,” he said.
Last year (March 2021-22), 7.07 million tons of the staple grain were imported into the country based on figures released by the Islamic Republic of Iran Customs Administration while the government bought around 4.52 million tons of wheat.
The government says it has doubled the prices of wheat it buys from farmers compared to last year.
FAO Forecasts
The Food and Agriculture Organization of the United Nations expects Iran’s wheat production to increase to 13 million tons in 2022 from an estimated 9 million tons in 2021, to register more than a 44% rise.
In its biannual report on global food markets, FAO has put the 2019-20 average production of wheat in Iran at 14.3 million tons.
Due to a projected rise in production, imports are forecast to decline from 7.9 million tons to 3.4 million tons.
The 2018-19 to 2020-21 average import has been put at 1.6 million tons.
Wheat consumption is forecast to slightly increase from 16.2 million tons in 2021-22 to 16.4 million tons in 2022-23.
The 2018-19 to 2020-21 average consumption has been put at 15.8 million tons.
According to FAO, Iran’s wheat stocks in the year ending 2023 is forecast to decline to 6.9 million tons from an estimated 7 million tons in 2022. The average stocks volume during the 2019-21 period has been put at 6.4 million tons.
Per capita wheat consumption is forecast to slightly increase to 169.7 kilograms per year in 2022-23 from an estimated 169.4 kilograms per year in 2021-22.
The 2018-19 to 2020-21 average per capita has been put at 168.7 kilograms per year.
