Prices for flour, cereal products in Iran rising

Business Materials 16 May 2022 13:37 (UTC +04:00)
Elnur Baghishov
Elnur Baghishov
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BAKU, Azerbaijan, May 16. The price of a 40-kilogram sack of flour in Iran has recently risen by about 10 times, Chairman of the Tehran Bread Producers Association Mohammad Javad Karami told ILNA, Trend reports.

“Thus, the price of a 40-kilogram sack of flour has risen to 6.4 million rials (about $152), while prior the price of flour rose, a sack of flour was sold for 670,000 rials (about $15.9),” Karami said.

The chairman also added that prior to the abolition of subsidies for flour and some cereal products in Iran, various bakeries had been buying 100 sacks of flour for 70 million rials (about $1,666). But now they have to spend 700 million rials (about $16,600) to buy the same amount of flour.

“Naturally, this hasn't gone unnoticed," he said. "For example, the price of some breads (sandwiches, etc.) has increased by at least 2-3 times.”

According to Karami, at present, sales and consumption of various breads in Iran have decreased by about 60-70 percent.

The official emphasized that it has been announced that the goal of abolishing subsidies for flour and some cereals products in Iran was done to fight speculation.

“However, in practice, this decision allows for more speculation. Because the population prefers to buy subsidized bread,” the chairman said.

Reportedly, Iranian government abolished subsidies for flour and some cereal products across the country last week. The Iranian government cited a number of reasons, including preventing the smuggling of wheat, flour and related products to neighboring countries.

In this regard, Iranian Ministry of Agriculture Jihad said that, wheat purchased from farmers in Iran for 115,000 rials (about $2.74) was sold to Iran's flour and cereal producers for 27,000 rials (about $0.64). This was aimed at delivering cereal products to consumers at lower prices. However, brokers used this situation to sell subsidized flour to neighboring countries at two to three times higher prices.

The Iranian government has decided to pay subsidies for flour and some flour products in cash to citizens. However, the low amount of compensation is not unequivocally welcomed by the population.


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