May 30, 2012

Iran research committee sees wheat imports surge

Considering the current purchasing price of wheat from domestic farmers, the research committee of the Iranian parliament (Majlis) said in a report that a surge is expected to be in importing wheat.

"Supply and demand determines prices in international markets. But, some other factors are involved in Iran's economy, which affect prices on certain products, such as wheat," the news agency reported.

"The subsidy reform plan emphasises maintaining the payment of cash subsidies to the agriculture sector and support farmers through providing them with ex-gratia payments or low-cost loans, but the plan had indirect negative effects on production, transportation and distribution costs."

The subsidy reform plan, which was launched in December 2010, allows the Iranian government to gradually slash subsidies on fuel, electricity, and certain goods over the course of five years, with low-income families being compensated with direct cash handouts.

Iran's wheat output is planned to reach 14 million tonnes in the current calendar year, which ends on March 20, 2013, a news agency quoted a report made by the ministry of agriculture as saying on Sunday (May 27).

The UN Food and Agriculture Organisation (FAO) placed Iran as the 12th leading producer of wheat in the world, with an average production of 14 million tonnes in 2011.

Among the major producers of wheat, the EU with 138 million tonnes and China with 117.9 million tonnes are set to be the top two producers of wheat this year. India with an estimated wheat production of 86.9 million tonnes and the US with 54.4 million tonnes ranked third and fourth on the list of the leading wheat producers of 2011, press TV reported.