Global Wheat Prices Fall, Flour Prices Rise in Azerbaijan

In Azerbaijan, there has been an observed increase in the price of flour. In May, a 50-kilogram sack of flour cost 25-26 manats, but now it has risen to 29 manats. This increase in the price of flour is also reflected in the data from the State Statistics Committee (SSC).

"Dəvəçi-Dəyirman" LLC confirmed to "Turan" that the price of flour has increased compared to the beginning of the year. The company explained this by the rise in the price of grain in Russia: "Back in May, the price of grain in Russia increased by 30-40 dollars per ton."

The company also predicted that the price of flour would decrease: "A drop in prices is expected after the grain harvest in the country."

The Ministry of Agriculture told "Turan" that grain production in the country has increased 1.5 times over the past 20 years: "Productivity indicators are also increasing. There is a 21.8% increase in wheat, 20.5% in barley, and 32.3% in corn for grain."

"To date, 2,691,552 tons of crops have been harvested from the fields. Of the harvested crops, 1,492,746 tons are wheat, and 1,198,806 tons are barley. The average yield for wheat is 33 quintals per hectare, and for barley, it is 29.4 quintals per hectare... Compared to the same period last year, mechanized harvesting has been carried out on an additional 60,148 hectares. The harvesting process is ongoing."

However, the ministry did not provide a comparison of wheat harvests between last year and this year.

Agriculture expert Vahid Maharramov told Radio Liberty that despite the rise in flour prices in Azerbaijan, there has been a sharp decline in wheat prices on global markets: "Even last month, wheat prices on the New York Stock Exchange fell by 16%. The drop in wheat and flour prices globally is due to the season and forecasts of increased production. However, the price drop on global markets does not affect Azerbaijan."

According to the expert, since Azerbaijan is dependent on imports, they cannot predict what will happen in the future: "Therefore, flour producers raised the price of flour. Initially, they justified it by claiming that prices were rising on global markets. Now they justify it by saying that their costs, including transportation costs, have increased."

According to Maharramov, there has already been a reduction in the weight of some types of bread by 30-40 grams: "This means that bread producers are reducing the weight of bread to compensate for the price difference because they are buying flour at higher prices. However, after a while, they will be forced to raise the price of bread."

The economist highlighted a decrease in wheat production in Azerbaijan: "In the first six months of this year, there has been a 5.6% decrease compared to last year. There is also a decline in productivity. This means that the cost of wheat production has increased, and with the recent price increase in diesel fuel, transportation costs will also rise. This will again affect prices."

At the end of June, by the decision of the Tariff Council in Azerbaijan, the price of one liter of "AI-92" gasoline was increased from 1 manat to 1.1 manats. The price of diesel fuel was raised from 0.8 manats to 1 manat.