Iran Raises Guaranteed Purchase Price for Wheat by 15%

Thursday, 20 April 2023 6:27 PM 

Iran’s agriculture ministry will buy domestic wheat output at a guaranteed price of $0.3 per kilogram.

Iran has raised its guaranteed purchase price for domestically-grown wheat by 15% for the April-July harvest season.

Government spokesman Ali Bahadori said in a Thursday tweet that that the Cabinet had approved a proposal by the Ministry of Agriculture Jihad (MAJ) to raise this year’s domestic purchase price for wheat to 150,000 rials ($0.3) per kilogram.

The price is 7% higher than current average international prices for wheat ($7.6027 per bushel). It comes amid government plans to increase its domestic purchase of grains and amid a continued crunch in global markets because of the ongoing war between Russia and Ukraine.

MAJ and its subsidiary the Government Trading Corporation (GTC) expect Iran’s domestic wheat purchases could increase by 13% to 8.5 million metric tons (mt) this year.

The GTC bought some 7.2 million mt of wheat from domestic farmers last year under its guaranteed purchase program. That comes as wheat purchases by private buyers reached 0.3 million mt over the same period.

Iran’s total wheat output reached 13 million mt last year, up from 10.1 million mt in 2021, according to figures by United Nations food agency FAO.

Purchases began earlier this month with the start of harvest in wheat-growing provinces in south and southeastern Iran and will continue until July when farmers in west and northern Iran deliver their crops.

Farmers represented by Iran’s National Foundation of Wheat Growers had hoped for a 23% increase in the guaranteed purchase price of wheat for this year’s harvest season.