ASSA-Irada,
16, May 2008

Kazakhstan has resumed grain exports to Azerbaijan, despite its earlier decision to suspend the deliveries until fall.

A department head at the Azerbaijani Ministry of Agriculture, Sabir Valiyev, said the issue was agreed at a recent meeting of the inter-governmental commission held in Astana. Azerbaijan will import 150,000-200,000 tons of the product based on the previously-reached agreements.

The Central Asian state had banned exports of grain since April in an effort to protect the domestic market in light of soaring prices for food the world over and to hike the price for grain sold abroad by local producers. Prior to the ban, Azerbaijani importers signed contracts with Kazakh grain producers, and made initial payments. However, they encountered problems with the deliveries after Kazakhstan suspended exports of the product to a number of countries, which caused several grain mills to halt operation.

Agriculture Minister Ismat Abbasov told reporters that imports of grain not only from Kazakhstan but also from other countries were under consideration.

"It is certainly lucrative for Azerbaijan to buy grain from Kazakhstan and Russia due to a short distance. But if Kazakhstan refuses to export it again, we could import the product from other states as well," the minister said.

Israeli Agriculture Minister Shalom Simhon visiting Baku has predicted that world prices for grain are likely to go down by 40 per cent in the near future. He told the press that he had arrived at the conclusion after studying current situation in world markets.

"Grain production was very prolific in the world this year. Producing countries have sufficient grain reserves," Simhon added.

Azerbaijan's annual demand for grain is 3 million tons, of which 30 per cent is imported from Kazakhstan and Russia.