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Georgia looks to import wheat from Europe, US instead of Russia

Wednesday, January 14
The Georgian Government is discussing the opportunity to import wheat from European and American markets instead of Russia after Russia decreased its wheat exports to foreign markets. Currently the best offer has come from Hungary, said head of the Association of Bakery Producers Levan Silagava.

After Russia decreased wheat exports to foreign markets including Georgia, the Georgian Government started to fill and increase its wheat stocks. To achieve this goal, experts said it was important to expand local wheat production. Currently 90 percent of wheat imported to Georgia comes from Russia.

"The Georgian Government is going to import European and American wheat using its own resources because one or two companies will not be able to handle this process," Silagava said.

We are thinking about importing American wheat and then on-selling it to mills and fill our supplies this way. We were discussing the opportunity to import wheat from Kazakhstan but the price of Kazakh wheat is very high. We have offers from European countries with lower prices, he added.

"Having wheat supplies is very important for any country as it is a strategically important product such as oil, gas or energy efficient products. Every government tries to fill its wheat supplies. During the 2008 global economic crisis, the United Nations adopted a recommendation that any country should have 12 percent of consumption of wheat supplies, Silagava said.

In Georgia the situation became tenser when Russia decided to reduce its export markets because it faced the problem of filling its own stocks, he said.

"For the past two years Russia was our main supplier as it used to offer the best price. But it does not mean that we are completely depended on the Russian market. For example three years ago we imported 80 percent of wheat from Kazakhstan because at that time this country offered the most competitive price, he added.

Currently the minimum price of one sack of flour is 35-36 GEL but it could reach anywhere up to 45 GEL, as the price of wheat in Russia has recently increased by 50 percent. Despite this, Silagava believed the price of bread in Georgia would not increase as the country had enough wheat supplies. (Agenda.ge)