IN ARMENIA FOOD PRICE GROWTH SLOWER THAN IN OTHER COUNTRIES
27-03-2008 16:30:00 | Armenia | Economy
YEREVAN, MARCH 27, NOYAN TAPAN. The appreciation of the
Armenian dram against the US dollar contributes to the control
of inflation in Armenia, which in particular explaines the low
inflation rate as compared with other countries, Nerses
Yeritsian - the RA minister of trade and economic development,
head of the interdepartmental working group on studies of
consumer commodity prices in domestic market - stated at the
March 26 sitting of the group.
To recap, the working group was set up on the instruction
of the RA prime minister in December 2007.
Member of the working group, RA deputy minister of trade
and economic development Vahram Ghushchian said that the prices
of 6 essential goods included in the consumer basket: grain,
flour, vegetable oil, granulated sugar, butter and rice were
subjected to monitoring. According to him, the price growth in
February 2008 on February 2007 made: grain - 26.1%, sunflower
oil - 46.9%, rice - 12.1%, flour - 32.5%, cheese - 5.6%. Butter
and granulated sugar prices fell by 4.9% and 16.3% respectively.
Bread prices grew by 13%, flour prices - by 9.7%, round
rice prices - by 29.6%, while prices of oblong rice fell by 15%
as of March 25, 2008 on the previous month. Prices of some types
of vegetable oil fell up to 6.5%, prices of other types rose up
to 5.8%, prices of some types of butter grew up to 2.1%, while
prices of other types fell up to 3%. Granulated sugar price grew
by 5.9%.
It was announced that by data of the UN Food and
Agriculture Organization (FAO), the prices of foodstuffs
(including prices of the goods subjected to monitoring by the
above mentioned working group) increased in international market
in 2007, while the average index of food prices made 157%, which
exceeds by 23% the 2006 index. In particular, the international
price of 1 ton of wheat was about 370 dollars in December 2007 -
January 2008, in February it made 446 dollars, while the price
of future deals for May made 540 dollars. In 2007, the average
price of 1 ton of rice made 500 dollars in Thailand, the price
of rice reached 400 dollars in the Chicago Board of Trade,
exceeding by over 75% the 2006 index. According to FAO, prices
of butter and milk products grew by 50% and 80% respectively in
international market.
The deputy minister said that in the opinion of
international experts, the main cause of the rise in
international food prices is the unprecedented growth in
international prices of oil, which resulted in a growth of the
biofuel production, which in its turn has contributed to a
stable high level of grain, beet and soya prices. The indicated
price growth was also caused by the increase of food
consumption, which is mainly conditioned by a growth in
consumption of foodstuffs in developing countries, especially
China and India. All indices registered allow to forecast that
inflation has a tendency to continue until 2020.
In the words of V. Ghushchian, by FAO forecasts, about 500
mln dollars is needed for implementation of the world food
security program. It was stated that with the aim of ensuring
food security and protecting domestic prices in Armenia, the
country's government is taking steps for promotion of domestic
production of foodstuffs. For this purpose, in 2008 the
agriculture will receive budgetary subsidies of 1 bln 600 mln
drams (about 5.2 mln USD).