Flour prices increased by 25% in small shops

In Azerbaijan, there is a creeping inflation - in small retail outlets, a kilo of flour from March 30 is worth not 40 kopecks, as before, but 50 kopecks. In other words, today a ton of this product the majority of end users costs 500 manats ($ 640). Experts believe that the blame speculative mood sellers and lack of effective government control.

In addition, the geopolitical crisis in the heat of battle for the Crimea and Russia's attempt to distance itself from multinational companies (Glencore, Cargill, Louis Dreyfus), controlling 60 % of the grain market of the Russian Federation became a weighty reason for raising its prices for grain. And Russia, along with Kazakhstan and Ukraine, which are also expected to raise prices of the crop, are major exporters of strategic goods to our country. Export price of a tonne of wheat top class 2HRW, according to the Agriculture Ministry, has already reached 12,275 rubles ($ 343.95 at the current rate - last year the average exchange price was $ 275). In the same proportion as prices rose for other classes of grain. Given that transport costs to the cost of grain on the Chicago Stock Exchange (http://www.agrochart.com/ru/news/news/280314/obzor-ryinka-pshenitsyi-27-marta-2014).

State Grain Fund of the State Agency for Material Reserves under Azerbaijani Emergency Situations Ministry ( basic local importer of these products ) purchased approximately 500 thousand tons last year's harvest is in Russia , and in addition, Kazakhstan and Ukraine - $ 250 per ton. But regional millers (eg , Ganja and Shamkir ) in January, it was announced that Kazakhstan allegedly raised the price to $ 280 , although the government of this country at a special briefing stated commitment to early agreements. CJSC Azerbaijan Railways also raised the fare (+ $ 10) per ton of flour to these settlements (350-380 km from Baku), which together brought the cost per ton of flour to wholesalers to $ 400, and for the end user – even more expensive.

MOE through grain fund dictates the prices, despite the fact that local producers, according to the State Committee of Statistics, last year collected 2.938 million tons of grain in the country's needs of 3 million, 1.7 million of that being wheat. Because of bureaucratic monopoly mass production manufacturer is forced to hand over "to the right address," and flour prices are the same for all distribution centers, linked to major retail chains controlled by the same officials. A bag of flour of 50 (actually 46-48) kg costs 19 manat (AZN 380 or $ 485 per tonne) and in supermarkets - 20 manat (AZN 400 or $ 510 per tonne). In numerous small shops of the capital and the regions flour is sold only in kilograms, which brings the price per tonne to 500 manat or $ 640 (25 % compared with the beginning of the year).

This is not the limit, says chairman of the Center for Economic Research Ghalib Togrul. If the Cabinet of Ministers does not cancel the value added tax for imported grain and flour again by the third quarter of this year, the price of 50 kopecks and above per kg of flour will be normal even for large commercial enterprises. And the increase in the wholesale price of flour will cause the rise in retail prices, including the price of bread, pasta, noodles, flour and sugar confectionery.

If previously grounds for pessimism were increase in the purchase prices of wheat in Russia and Kazakhstan in favor of local producers, now on the agenda of the Crimea is also a factor - the economist said. Management of the company Naftogaz (Ukraine) from May 1 plans to raise half the price of natural gas for all categories of consumers that will impact on the milling industry. And this is again reflected in Azerbaijan - in last year's imports from Ukraine ($ 589 million or 5.5 % of the total by the end of 2013) wheat flour in the amount of $ 23.5 million, took the top spot by a wide margin. At the second place there is salt - $ 13.8 million and at the third there is bakery and pastry - $ 9 million.

According to Togrul, considering the increase in world prices of the Russian Federation, Kazakhstan and Ukraine in the foreseeable future will retain the status of main exporters of flour and grain to Azerbaijan.

The report on the state of the world grain market, the International Grains Council (IGC) predicts a rise in price of all kinds of grain amid rising consumption - 1,940,000,000 tons (150 million compared to the previous marketing season). Forecast of wheat this year - 695 million tons while consuming 690 million tons and 142 million tons of trade.

In January and February of this year, Azerbaijan, according to the State Customs Committee, imported grain at $ 51,542,470, or 206,169.88 tons of grain at the rate of $ 250 per ton. That's $ 300,000 more than the same period last year.

Recall, according to the State program of food security, in 2015 the government of Azerbaijan should completely abandon grain imports, providing the country's demand through domestic production. - 17D-