Government Plans Emergency Wheat Imports As Bread Prices Surge

The Armenian government announced on Thursday that it will import 9,000 metric tons of wheat from Russia this month to halt a continuing rise in the price of bread that has hit hard a large part of the country’s low-income population.

The bread prices in Armenia have surged by more than 20 percent, while the wholesale cost of flour has nearly doubled over the past week. The government attributes the drastic increase to wheat shortages in Russia, Armenia’s main supplier of cereals. It has denied media speculation about a price-fixing deal allegedly cut by a handful of businessmen that control the lucrative imports.

Agriculture Minister David Zadoyan reiterated this view at a news conference, saying that the price of Russian wheat has shot up by 70 percent over the past seven months. He said its vital imports to Armenia have shrunk as a result, creating considerable shortages of what is the basic staple food for many Armenians.

Critics, however, claim that market factors have not necessarily been decisive, pointing to the fact that the bread prices began rising immediately after the May 25 parliamentary elections in which the governing Republican Party of Prime Minister Andranik Markarian was the top contender. The claim that the country is at the mercy of a small group of government-connected businessmen who enjoy a virtual monopoly on imports of key products such. One of them, Samvel Aleksanian, was easily elected to the parliament.

Zadoyan said the government will cover the deficit by emergency purchases from Russia’s cereal-growing southern regions. Agreement on that was reached this week in Yerevan by Markarian and Russian President Vladimir Putin’s special representative in the vast area, Victor Kazantsev, he added.

According to Zadoyan, the crisis will be further alleviated by supplies from domestic wheat-growers whose winter crops are expected to ripen next month. “The price crisis will be over by the end of this month,” he said. “Our first harvest will mature in July and that will somehow resolve the problem.”

The minister could not say whether the prices of bread, now averaging 220 drams (40 U.S. cents), will fall back to the pre-crisis levels.