The situation in the global grain market will remain volatile,
Deputy Director of the Russian School of Economics, Professor of
Azerbaijan State University of Economics (UNEC) Elshad Mammadov
'The global economic crisis is continuing and price imbalances,
imbalances in general between the financial and real sectors of the
economies of different countries are reaching extremely high values
and of course, inflation is already a tendency, and geopolitical
tension further aggravates the situation. I think that in these
conditions it's extremely important for all countries to maintain
predictability, and stability in the domestic consumer market and
ensure food security,' Mammadov said.
According to him, Azerbaijan faces serious challenges.
'First of all, the challenges are related to the fact that our
main foreign trade partners in grain export are Russia, Ukraine and
Kazakhstan. It's clear that in the context of the events that are
taking place on the territory of Ukraine, it does not seem
realistic to count on stable supplies. As for Russia and
Kazakhstan, these countries are also introducing restrictive
regimes in foreign trade on one hand in order to strengthen their
capabilities in the global grain market, and on the other hand in
order to ensure the food security of their countries as a
priority,' he said.
He stressed that one of the ways out of the situation is the
most efficient use of internal resources to localize production
processes within the country.
'It's necessary to replace imports extremely rapidly, to develop
domestic production. In general, bearing in mind the critical
importance of wheat in the domestic food market, I believe that
with this situation, with this state of affairs, it's urgent to do
something and change tendencies in the opposite direction, so that
the domestic market could be provided with products of domestic
producers, in order to ensure the country's food security in the
right format,' Mammadov added.
According to Ph.D. in Economics Ilgar Velizade another
unfavorable factor for the volatile situation on the global grain
market is climate change.
'In particular, a significant decrease in agricultural
production is expected in European countries due to the severe
heat. This is a very important factor affecting the production of
all types of agricultural products, including grain products.
Another factor is a shortage of water for irrigation, in
particular, in a number of Middle Eastern states in which a
significant part of milling wheat was grown for domestic
consumption - Iraq, Syria, Egypt,' Velizade said.
However, according to Velizade, unfavorable factors connected to
the disruption in supply chains on the global market leaders to the
fact that some grain-producing countries, such as India, reduce the
amount of grain intended for export.
'Naturally, the situation is affected by the increase in prices
for fertilizers, due to the fact that the supply of mineral
fertilizers from countries such as Russia, Belarus, and Ukraine to
foreign markets is reduced, and this also leads to a decrease in
grain yields. In addition, the increase in fertilizer prices due to
the increase in energy prices, most mineral fertilizers are
produced from energy carriers - this is also a possible consequence
of the critical situation. This year, these critical tendencies are
taking place, but next year it is quite possible to expect a
deterioration of the situation,' Ph.D. noted.
Unfortunately, all these processes make an increase in flour
prices in Azerbaijan also inevitable, Velizade added.
'Azerbaijan buys grain abroad in large volumes, and we can
expect that in the near future there may be a rise in prices for
this type of product in Azerbaijan. Azerbaijan is making every
effort to somehow balance this situation by increasing its own
grain production and increasing yields - this can be achieved by
improving the agrotechnical measures, in particular, optimizing the
irrigation system, optimizing work to improve soil quality,
including through its own fertilizers. The introduction of new land
in the liberated territories of Azerbaijan also gives considerable
hope that grain production will grow in the coming years,' he
'I hope that these events, which are being held in combination,
will allow us to achieve the desired results in the coming years.
Nonetheless, the social policy that is being implemented in
Azerbaijan can also offset the negative risks of an increase in
grain prices. I hope that this set of measures will allow the
situation to stabilize, to direct it in line with the forecasted
processes, which is very important today,' Velizade stated.
Follow us on Twitter @AzerNewsAz
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.