Thursday, February 22, 2024
NewsSmuggling threatens efforts to substitute wheat

Smuggling threatens efforts to substitute wheat

Smuggling may undermine Ethiopia’s ambitious plan to substitute wheat imports, officials said. Smuggling of agricultural products, notably wheat, has been a long-standing practice that has caused policymakers and customs authorities great concern.

According to researchers, farmers who want a better return on their output are smuggling out an amount equivalent to official exports of agricultural products to nearby countries. Agriculture accounts for over 80 percent of the country’s exports, which stood at USD four billion during the last fiscal year.

“There are illegal traders and exporters who smuggle the cultivated wheat every year across borders. A huge amount of agricultural commodities have been smuggled through Moyale to Kenya,” Meles Mekonnen, state minister for agriculture and horticulture at the Ministry of Agriculture, said.

The State Minister urged authorities to place control mechanisms and take punitive measures against smugglers.

“To benefit the farmer and the customer, we must keep the control mechanism in place and avoid intermediaries. If we could stop this, there wouldn’t be enough wheat for just the local market but also for export,” Meles said.

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During a press conference on Tuesday, the state minister explained that the ministry has been working to develop crops on 13.4 million hectares of land during the recently concluded rainy season. For the harvest seasons of 2022 and 2023, crop production is projected to be over 400 million quintals. Wheat makes up 160 million quintals of the total amount.

“To create a direct market linkage between farmers and consumers, regional states will provide finance to cooperatives as a revolving fund to share the harvesting costs with farmers,” said Meles.

Ethiopia has been spending between USD 700 million and USD one billion annually in the last five years to import wheat. With humanitarian crisis looming across the country because of drought and conflict, the wheat demand has seen a significant upsurge in the last two years. Yearly demand for wheat is believed to be around 100 million quintals.

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Video from Enat Bank Youtube Channel.

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