Since the turn of the century, Afghanistan has emerged as one of the world’s largest importers of flour, consistently ranked among the top three annually along with Uzbekistan and Iraq.
In the post-2000 period, although flour production has increased rapidly in Afghanistan, demand has grown even faster, spurred by a rapidly expanding population and strong economic growth albeit from a low base. The gap between domestic supply and demand began expanding in 2001 and exploded in 2006, when flour imports first surpassed 1 million tonnes.
A study, “Afghanistan’s Wheat Flour Market: Policies and Prospects,” released in the fall of 2013 by the U.S. Department of Agriculture’s Economic Research Service (Ers), examines trends in the industry and the role that policy interventions aimed at protecting the country’s wheat milling and farming sectors play in shaping the country’s long-term growth prospects for domestic flour production and imports.
The report notes that Afghanistan stands in sharp contrast to the international norm in its ratio of wheat grain to wheat flour imports, as flour comprises about 74% of the country’s total wheat imports. Afghanistan relies more heavily on imports of the processed commodity, in effect leaving the value-added from milling to other countries.
Afghanistan is a landlocked country, bordered on the west by Iran, on the south and east by Pakistan, and on the north by Turkmenistan, Uzbekistan and Tajikistan. It imports wheat and flour from a number of these neighboring countries, with Pakistan being the leading supplier.
The Ers report said the private millers and traders of Pakistan work closely with Afghan traders.
«Pakistani flour is widely accepted by Afghan consumers because of its quality, and Pakistani mills extend credit to Afghan traders seeking to purchase flour», the report said.
Kazakhstan, the largest exporter of wheat in the region and in recent years a dominant flour exporter, is the other major supplier, although it does not share a border with Afghanistan. The quantities of Kazakh wheat and flour that have been exported to Afghanistan arrive via circuitous routes through Tajikistan, Uzbekistan, and Turkmenistan.
«In 2008, extremely tight supply situations in Afghanistan and Pakistan allowed Kazakhstan to increase its exports to Afghanistan to an unprecedented level of 1.3 million tonnes, or 34% of the Afghan import market», the report said. «However, even then substantial price hikes were needed to ring these increased Kazakh flour shipments through the inefficient transport system from the north. The supply situation in Pakistan eased in the following years, allowing that country to again increase its share of the Afghan import market at the expense of Kazakhstan».