Chamber of Commerce to Hold on Purchase of 200 Tonnes of Grain

تم نشره في Mon 15 February / Feb 2016. 05:32 PM - آخر تعديل في Mon 15 February / Feb 2016. 06:59 PM
  • Wheat Bags in one of the warehouses in Amman - (Archives)

Tariq Al D'eja

AMMAN — The Central Tenders Committee at the Ministry of Industry and Trade (MIT) has decided to hold on purchasing wheat and barley pending re-tender due to an expected decline in the prices of grain worldwide, according to a well-informed government source.

The source, who requested anonymity, said that the Tenders Committee has yet to see the eight bids on wheat and barley made last week; four bids for each.

The source also reassured that the ministry constantly monitors the fluctuation of grain prices in global markets to make purchases when prices are low.

The UN Food and Agriculture Organization (FAO) index shows a decline in prices by 1.7 per cent, down to 149.1 points in January 2016. This decrease is thought to be a result of ample global supplies of grains and increased competition over export markets, Especially on wheat and corn. Notably, the strength of the US dollar plays an important role in determination of competitive grain pricing.

According to reports issued by FAO, it is estimated that the ending balance of world cereal stocks for 2016 will close at 642 million tonnes, which is higher than the beginning balance of grains worldwide for the same year. This implies a stable rate of global cereal consumption at approximately 25 per cent.

On the other hand, inventory levels around the world will probably vastly differ and vary by-crop, and geographically. While it is expected of the United States to register significant growth in wheat stocks for 2016, along with the European Union and China, countries including Canada, India, and Iran will demonstrate a general decrease in stocks of the same grains.

Accordingly, the data collected indicates the deadline to receive for bids to participate in the tender for wheat is next Tuesday afternoon. Details and instructions including tender specifications and conditions and participation invitations are available at the MIT Tendering Department for a non-refundable JOD650.

As for barely, the Ministry also set the deadline to Thursday afternoon, in regards to submission for participate in the tender.

The Tenders Committee proposed two separate tenders last week for the purchase of 200,000 tonnes of wheat and barley, according to data published by the Ministry.

According to official statistics, the Kingdom stores about 895 thousand tonnes of wheat, enough to supply 11 months of national demand. 250 thousand tons of which are readily available in warehouses in Jordan, and 64 thousands tonnes are contracted and in-route.

Jordan consumes wheat at a rate of 80 thousand tonnes per month, annually amounting to 960 thousand tonnes.

As for barley, there are 430 thousand tonnes in stock; enough to cover the consumption of about 7 months, at a monthly rate of approximately 65 thousand tonness per month.

With respect to prices, MIT cites recent sale prices at JOD78.7 per tone for subsidised flour, and JOD175 per tonne of barley. In regards to government support on grain products for the 2016, support on cereal products is expected to increase by JOD13 million to reach JOD215 million as opposed to JOD202 million last year.

The government estimated the height of the support materials ration (wheat and barley) during the current year by 13 million dinars, compared to what is expected to arrive until the end of last year to 215 million dinars, compared to B202 million until the end of this year.