ARMENIA CAUSES PRICE OF WHEAT IN KARABAKH TO DECLINE

Lragir.am
19 June 06

Ararat Hayriyan, the executive director of the Karabakh-based Alraghats
(Mill) and Bread Factory, gave a news conference June 17 to announce
that buyers of wheat from Armenia artificially decrease the price of
wheat in Karabakh.

In Karabakh production of wheat is the most profitable business.

Besides, it is the only production, which involves local resources,
and there is no problem of market. In a "neither peace, nor war"
economy it is the most convenient form of business, for its does not
require long-term investments. Therefore, they produce a lot of wheat
in Karabakh. One third of the production supplies the local demand. The
rest is exported to Armenia, which imports wheat from Russia.

In this period of time the price of the Russian wheat is not clear
yet, whereas harvest in Karabakh has already started. The Armenian
producers arrive in Karabakh to buy wheat in the field. By the way,
the price is artificially reduced to 65-70 drams per kg. Most farmers
have nowhere to store and no cars to transport grain, so they have to
sell their wheat for this price. Ararat Hayriyan says, however, that
in 1 or 2 months the price of wheat may grow up to 100 drams. Since
the annual income of the Karabakh farmers comes from wheat, even
several drams are very important. Considering this, Mill announced
that they will buy wheat for 85 drams per kg, and will pay 25 percent
on the same day. Mill can buy 15-20 thousand tons of wheat.

The executive director of Mill advises farmers not to sell wheat
on these days. Mill is supposed to be interested in a low price,
but apparently the factory thinks about the producers of wheat.

Especially that according to Ararat Hayriyan, not only the buyers
from Armenia press farmers but also the Karabakh government.

"Many of them took a loan or rented land in fall. Visit the house of
any farmer, there is a notification of Procuracy on the table.

Loan conditions are so hard that the farmers start repaying debts
before starting to sell the grain. Therefore they have to sell the
grain cheaply to repay the debts," said Ararat Hayriyan.