Stocks of wheat in Georgia are exhausted – flour millers are sounding the alarm

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Stocks of wheat in Georgia are exhausted – flour millers are sounding the alarm

Stocks of wheat in Georgia are exhausted – flour millers are sounding the alarm

For several months now, the import of wheat to Georgia has lost its meaning, based on the zero duty on flour imports, the director of the Association said 13.05.2022, Sputnik Georgia

2022-05-13T19:29+0400

2022-05-13T19:29+0400

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TBILISI, May 13 – Sputnik. There are practically no wheat reserves left in Georgia, due to which all flour mills operating in the country will stop working in the coming days, Levan Silagava, Executive Director of the Wheat and Flour Producers Association, said. June 2021. Therefore, Georgia increased its imports of flour from the Russian Federation several times, for which export duties are not charged, respectively, reducing wheat imports by more than 30% last year. flour duties. For wheat from Russia, the floating duty is $120 per ton. “This is a very big difference. For several months, flour has been coming aggressively and replacing wheat,” he explained. Russia has been the main supplier of wheat to Georgia for many years, so every increase duties on grain exports to the Russian Federation is becoming a cause for concern for the country. Georgia has enough stocks of wheat flour – Ministry of Agriculture >>During the year, Georgia consumes 700-800 thousand tons of wheat. Hence, only 10% of the grain is locally produced. The rest the country imports from Russia, Kazakhstan, Ukraine and the USA. Russia accounts for 70% of this grain import. Its cost was the most profitable for Georgia. Silagava recalled that, according to the UN recommendation, countries should have a two-month supply of wheat, not flour. According to Silagava, despite the fact that wheat was replaced by flour, the price of bread still increased by 24 % in 2021. In addition, despite the fact that the import of flour began in July last year, the price of bread has also increased this year. At the same time, according to Silagava, the Association asks the prime minister for a meeting. The main proposal of the sector is to equalize the difference between flour imports and taxes on wheat imports. According to Silagava, the issue should be decided by the prime minister alone, because “the existing working group, where different positions are fixed, has exhausted itself.” Wheat processing creates for Georgia a whole chain of values ​​- employment, bran processing (if the plant stops, then bran imports should take place). Bread in Georgia will not rise in price for several more months – the expert named the reasons >> % of bran of local production went to animal husbandry,” Silagava said. According to the director of the Association, wheat imports allow Georgia to have carry-over stocks, which is a guarantor of the country’s food security. “In the near future, the local grain harvest will begin, which we will meet with stopped mills” – he concluded. What do the authorities think? In order for the population of Georgia to receive extremely cheap bread, the state contributed to the import of cheap flour into the country, which, of course, is a priority, Deputy Minister of Agriculture Giorgi Khanishvili said. in about 1.5-2 months, in July-August, the harvesting of a new wheat crop will begin in Georgia, including all over the world. “This in itself leads to the development of a new crop and the development of a new pricing policy. We hope that with this new price policy, the world’s bread prices will be adjusted and wheat prices will be more stable and more acceptable. Accordingly, the Georgian government will develop an adequate policy for this period that will be acceptable for the industry as a whole,” the deputy minister said. The price of bread will increase in Georgia >>Khanishvili noted that the state is implementing systemic projects to support farmers and increase local production. This year, an additional project is being implemented in the country that provides access to a preferential agricultural loan in the amount of 5 to 100 thousand lari.According to the Deputy Minister, last year the wheat harvest in Georgia amounted to 140 thousand tons, this year it is expected to exceed 150 thousand tons .Khanishvili stressed that there is no shortage of any product in the country.

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For several months now, the import of wheat to Georgia has lost its meaning, based on the zero duty on flour imports, said the director of the Association

TBILISI, May 13 – Sputnik. There are practically no wheat reserves left in Georgia, due to which all flour mills operating in the country will stop working in the coming days, Levan Silagava, executive director of the Association of Wheat and Flour Producers, said.

Difficult times have come for Georgian flour millers after Russia introduced a floating duty mechanism for grain exports in June 2021. Therefore, Georgia increased its imports of flour from the Russian Federation several times, for which no export duty is charged, respectively, reducing wheat imports by more than 30% last year.

“The stocks of wheat that were before are practically exhausted, and in the coming days the mills will stop. Wheat for import to Georgia has not even been ordered, only flour is imported,” Silagava said on the air of the Palitra TV channel.

As Silagava explained, it has been several months since the import of wheat to Georgia has lost its meaning, based on the zero duty on flour. For wheat from Russia, the floating duty is $120 per ton.

“It’s a very big difference. Within a few months, the flour comes aggressively and replaces the wheat,” he explained.

Russia has been the main supplier of wheat to Georgia for many years, so each increase in the duty on grain exports to the Russian Federation becomes a cause for concern for the country.

Georgia has enough stocks of wheat flour – Ministry of Agriculture >>

During the year, Georgia consumes 700-800 thousand tons of wheat. Hence, only 10% of the grain is locally produced. The rest the country imports from Russia, Kazakhstan, Ukraine and the USA. Russia accounts for 70% of this grain import. Its cost was the most profitable for Georgia.

Silagawa recalled that, according to the UN recommendation, countries should have a two-month supply of wheat, not flour.

“Unfortunately, the current situation in our country does not comply with the UN recommendations – we do not have wheat reserves at all, and how much flour we have is up to the bread producers and the state,” he said.

Even though wheat was replaced by flour, the price of bread still rose by 24% in 2021, according to Silagawa. In addition, despite the fact that the import of flour began in July last year, the price of bread has also increased this year.

At the same time, according to Silagava, the Association asks the prime minister for a meeting. The sector’s main proposal is to equalize the difference between flour imports and taxes on wheat imports.

According to Silagava, the issue should be decided by the prime minister alone, because “the existing working group, where different positions are fixed, has exhausted itself.”

Wheat processing creates a whole value chain for Georgia – employment, bran processing (if the plant stops, then bran imports must take place).

Bread in Georgia will not rise in price for a few more months – the expert named the reasons >>

“Recently, imports of bran have tripled. So far, 90% of locally produced bran has gone to animal husbandry,” Silagava said.

According to the director of the Association, the import of wheat allows Georgia to have carryover stocks, which is a guarantor of the country’s food security.

“In the near future, the harvesting of the local grain harvest will begin, which we will meet with stopped mills,” he concluded.

What do the authorities think

In order for the population of Georgia to get the cheapest possible bread, the state contributed to the import of cheap flour into the country, which, of course, is a priority, Deputy Minister of Agriculture Giorgi Khanishvili said.

According to him, the increase in flour imports affected the stocks of wheat, since it will not be possible to have stocks of both products.

“This is motivated by the fact that the population receives the cheapest flour that can only exist today on the world market. Therefore, there are naturally no problems with stocks, today there are stocks of flour, not wheat,” he explained.

According to him, in about 1.5-2 months, in July-August, a new wheat harvest will begin in Georgia, including all over the world.

“This in itself leads to the development of a new crop and the development of a new pricing policy. We hope that with this new pricing policy, the prices for bread in the world will be regulated, and wheat prices will be more stable and more acceptable. Accordingly, the Georgian government for this period will develop an adequate policy that will be acceptable for the industry as a whole,” the deputy minister said.

The price of bread will rise in Georgia >>

Khanishvili noted that the state is implementing systemic projects to support farmers and increase local production. This year, an additional project is being implemented in the country, providing access to a preferential agricultural loan in the amount of 5 to 100 thousand lari.

According to the Deputy Minister, last year the wheat harvest in Georgia amounted to 140,000 tons. This year it is expected that it will exceed 150 thousand tons.

Khanishvili stressed that there is no shortage of any product in the country.

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