"Iran becomes biggest wheat importer
By Najmeh Bozorgmehr in Tehran and Javier Blas in London
Published: April 16 2009 19:07 | Last updated: April 16 2009 19:07
Iran has become the world’s largest importer of wheat, the country’s staple, in a blow to Tehran’s goal of achieving self-sufficiency in the crops it considers key to food security.
Iran has in months catapulted from being a minor player in the cereals market to the top buyer. It has even been forced to buy wheat from the US for the first time in 26 years.
The surge in cereal imports – due largely to drought – comes amid rising concern about food security among Middle East and North African countries that has led Saudi Arabia and other wealthy Gulf states to seek farmland overseas to grow crops.
The US department of agriculture forecasts Iran will buy 8.5m tonnes of wheat in the 2008-09 crop year, which ends in June, taking it ahead of Egypt as the world’s top importer.
Iran would then account for about 6.5 per cent of the global trade of the grain. Cereals traders confirm the forecast – the benchmark for agricultural markets – pointing to strong buying by Tehran. The total cost of the imports is estimated at between $2bn and $2.5bn (€1.5-€1.9bn, £1.3bn–£1.7bn), with the 1m tonnes bought from the US since last July worth $356m.
“With production in 2008 reduced by drought, Iran has set aside its goal of wheat self-sufficiency and emerged as the world’s largest wheat importer, after importing only 0.2m tonnes in 2007-8,” the USDA said in a recent market report.
Iran sees wheat as a strategic commodity for its 70m population, for whom bread and rice are the main food sources. The country claimed it had achieved self-sufficiency in grain in 2004, but recent bad crops have forced it to enter the international market.
Mohammad-Reza Eskandari, minister of agriculture, has vowed to regain wheat self-sufficiency by producing 15m tons this season. But traders remain sceptical, pointing out that Tehran continues to buy large amounts in the international market for delivery later this year, suggesting another bad crop.
Issa Kalantari, head of the country’s national farmers’ union and a former agriculture minister, has cast doubt on Iran’s ability to maintain wheat self-sufficiency.
“Since there is a severe shortage of investment in the agricultural sector the question of self-sufficiency is meaningless,” said Mr Kalantari.
The government of Mahmoud Ahmadi-Nejad, president, argues that drought is the only reason for importing grain. But his critics say record imports of agricultural products, worth about $12bn, is due to mismanagement and drought.
Copyright The Financial Times Limited 2009"