In the full economic and financial collapse, the country of cedar is looking for alternatives to Ukraine and Russia sectors.
by
FOUAD is helpless in its small bakery of Mana’iche, popular wheat cakes cooked most often thyme or cheese. He saw his clientele widespread in the Beirut district of Ras El-Nabaa, under the serious economic and financial crisis that has been raising since 2019. This translates into the collapse of purchasing power, on the backdrop of Galoping inflation. He now fears that his activity slows more with the war in Ukraine, who “aggravates the situation.” Indeed, almost all tender wheat consumed in Lebanon came from Ukraine (80%) and Russia (16%).
Since the beginning of the conflict, “the amount of wheat flour that can be acquired is limited, because the priority goes to bakeries that make the bread [flat] Arabic [a quota has been reserved for them, about 60% to 70% of imported wheat]. The rest, it is necessary to get it to the black market – individuals who resell more “, assures Fouad.
Government statements are reassuring, but they do not panic. In fact, the flour stalls are empty in supermarkets. Some importers of wheat adopt, on the other hand, a catastrophist tone. Finally, current reserve assessments – which do not take into account probable parallel stocks – are fluctuating.
“A hurricane of famines”
“Lebanon is a month and a half of tender wheat reserves,” says Georges Berberi, at the head of the Cereal Branch and sugar beet, attached to the Ministry of Economy and Trade. If all the Near East is threatened by the rupture of the sectors of Ukraine and Russia, Lebanon has its own challenges, including storage, because the Beirut’s silos were destroyed during explosions in the port, in August 2020. And the font of the central bank’s foreign currency reserves, which subsidizes wheat imports at a preferential rate (a dollar for 1,500 Lebanese pounds, when it exceeds 24,000 Lebanese pounds in the black market).
The race is engaged to cover tender wheat requirements (about 650,000 tons per year). One of the priorities is to find supply alternatives. Contacts with Romania, Moldova [which already exports to the country of cedar], Kazakhstan, the United States, India, details Mr Berberi details. It is also necessary to “identify new storage places in Lebanon, or even a country where the wheat bought could be temporarily deposited,” he explains. This would reduce the impact of a subsequent flight of cereal prices.
You have 45.15% of this article to read. The rest is reserved for subscribers.