Government to buy barley and corn to ease spiraling prices (updated)

The government will buy 36,000 tons of barley and corn, in two shipments, to ease a shortage of grains on the market in the wake of Russia’s invasion of Ukraine, Agriculture Minister Costas Kadis said on Tuesday.

He told the House agriculture committee that the ministry will then work with importers to manage these strategic reserves.

Kadis said that he will submit a proposal to cabinet on Wednesday.

The total cost will be €12.5m, with the state taking what he described as a precautionary measure to ensure adequacy of stocks.

According to Kadis, the planned purchases should guarantee adequacy of grains for three-and-a-half months for flour milling, and 15 days for livestock feed.

“We reacted in record time,” the minister told MPs, adding that the government is moving fast so that the shipments get here as soon as possible.

The government has a plan for where to buy these quantities from. If Cyprus does not manage to secure the commodities from the European Union, it would look at the US market.

Energy Minister Natasa Pilides, whose portfolio also includes industry, commerce and consumer protection, said that a mechanism must be found to support those affected while ensuring that there is no profiteering at the expense of the taxpayer and only those business groups that qualify are helped.

Pilides said that possibly a price cap will be placed on grains – but if so, only for those grains intended for human consumption.

In parliament, the head of the sheep and goat farmers association Sotiris Kadis appealed for urgent assistance from the state, saying that “any day now, there won’t be feed left for the animals.”

The cow farmers association said the entire livestock farming sector is in a state of collapse, and in the worst position ever. And the prevailing prices mean that businesspeople won’t be able to afford to buy grains.

Another representative observed that even if the government placed the order today, the shipment would not arrive for a month.

Cyprus is understood to have enough stocks for livestock for six weeks and human consumption for four months.

Russia and Ukraine are two of the world’s biggest grain suppliers. The war and the sanctions against Russia have led to a scramble for alternative supplies.