RUSSIA – Ministry representatives from Kazakhstan, Iran and Russia have signed a Memorandum of Understanding on wheat trade, a step towards boosting trade cooperation between the countries.
An AzerNews report stated that the memorandum was an integral part of the free trade zone agreement signed last year between the EEU (Eurasian Economic Union) member states and Iran.
The EEU includes Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan.
The memorandum was signed by Deputy Agriculture Minister of Kazakhstan Gulmira Isayeva, Deputy Agriculture Minister of Iran Ali Akbar Mehrfard and Deputy Agriculture Minister of Russia Sergey Levin.
According to Iranian representative Ali Akbar Mehrfard, the development does not only build relations between the nations, but also lead to a more dynamic growth of trade between the states which will continue to strengthen logistics and industrial cooperation.
“The memorandum includes three very important aspects. Iran’s flour mills have great potential, and the regional market is about seven million tons. According to the memorandum, Russia and Kazakhstan can use Iran’s logistical capabilities and in transit to deliver their wheat to third countries.
The second is the joint development of wheat SWAP contracts with Russia and Kazakhstan. The third is related to the conditions of temporary importation,” said Ali Akbar Mehrfard.
As a result of the agreement, Russia is expected to start shipment of wheat to Iran within the framework of mutually beneficial contracts concluded.
Iran will promote freedom of transit through its territory, and also support the import of wheat in the framework of SWAP contracts, including on exemptions from bans and other restrictions on Kazakhstani and Russian wheat.
The memorandum also provides for exemption from any customs duties or other equivalent fees, in respect of wheat imported from Kazakhstan and Russia for the transit purpose or temporary import.
Based on the report, Iran has achieved self-sufficiency in the production of wheat but will act as a bridge for exporting wheat produced by Russia and Kazakhstan to other countries.
It was noted that Iran produces 12 million tons of wheat, which meets the country’s domestic need.