Iran Gov’t Buys 5.5% More Wheat This Year

EghtesadOnline: More than 9.5 million tons of wheat worth 120 trillion rials ($750 million) have been purchased from local farmers across the country by the government in the current Iranian year, registering a 5.5% rise both in weight and value compared with last year.

News ID: ۷۸۴۱۶۵

10 October 2018

This was stated by an advisor to the agriculture minister and executive manager of the so-called “National Wheat Project”.

“Plans are to cultivate 14 million tons of the staple grain during the current crop season. Some 480,000 tons of wheat seeds have been provided for this purpose, which will sufficiently meet domestic demand,” Esmaeil Esfandiaripour was also quoted as saying by IRNA.

Wheat season starts on Sept. 23 of every year and ends on Sept. 22 of the next, according to Financial Tribune.

At present, he added, wheat is cultivated over 2.05 million hectares of irrigated and 3.85 million hectares of rain-fed land. The ministry is planning to reduce the land under wheat cultivation and increase productivity in farms, so as to reduce the amount of water and energy used in the cultivation processes of the grain.

"This year’s wheat purchases from local farmers at guaranteed prices began on March 26 in the southeastern Sistan-Baluchestan Province’s Sarbaz County," deputy agriculture minister Yazdan Seif, who also doubles as the head of the Government Trading Corporation of Iran, was quoted as saying by Mehr News Agency.

Iran has been self-sufficient in wheat production for two years now and only imports the crop for reexport after it is processed. More than 8.87 million tons of wheat worth 116 trillion rials ($2.83 billion) were purchased from Iranian farmers by the government last year.

A record high of 14 million tons of wheat were domestically produced the year before, more than 11.76 million tons of which worth over $4 billion were purchased by the government from local farmers at guaranteed prices.

This helped Iran achieve self-sufficiency in wheat production for the first time after about a decade. Every year, the government buys strategic crops, including wheat, from local farmers at guaranteed prices to control prices in the domestic market.

GTC is a government-owned company specializing in the purchase, import and distribution of essential foodstuff. It is the lever for enforcing market controls.

The company is also in charge of maintaining a supply of wheat, rice, cooking oil and meat for the country’s strategic reserve of essential goods.

The Iranian government's approach to control the local market for strategic crops is to purchase the crops from farmers in bulk, store in reserves and then distribute them throughout the year as needed.