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Grain And Flour Market in Belarus, Estonia, Latvia and Lithuania

13 September 201612 min reading

Wheat flour exports of Belarus has been oscillating between 10,000 and 20,000 tons in the last five years. Wheat flour exports for Estonia has been changing between 15,000 and 21,000 tons in the last five years. Latvia exported 28,000 tons of wheat flour in 2011, and the amount later increased to 51,000 tons in 2012. The amount exported in 2013 was 42,000 tons. Wheat flour exports of Lithuania reached 29,000 tons in 2011; however, the amount went down to 23,000 tons in 2012. The imported amount was 24,000 tons in 2013.

ulkeA former member of the USSR, Belarus has a population of approximately 9.5 millions. Its capital is Minsk. Forging close relationships with Europe, Belarus is a neighbour of Latvia in the north, Lithuania in the north-west, Russian Federation in the north-east and east, Poland in the west and Ukraine in the south. A Baltic country in Northern Europe, Estonia has a population of approximately 1.3 million, and its capital is Tallinn. Economical and political relationship between Estonia and the West was started in 1994, when the last Soviet troops left the country, and Estonia became a member of NATO and EU in the spring of 2004.

Latvia, whose capital is Riga, has an estimated population of 2.2 millions. Situated in the north-eastern part of Europe, Latvia is located on the coasts of the Baltic Sea and the Gulf of Riga. It is surrounded by Estonia in the north, Russia in the east, and Lithuania in the south. Lithuania, which has a population of 3.1 millions, is surrounded by Latvia in the north, Belarus in the east and south, Russia and Poland in the south-west, and the Baltic Sea in the west. With its capital at Vilnius, the country is a member of NATO; the European Council, and the EU.

OVERALL ECONOMICAL VIEW Belarus is located at the heart of Europe, in the middle of large and significant highway and rail road networks among the Russian Federation, European countries and Asia, and at the intersection of essential communication hubs as well as oil and gas pipelines. An overall glance at the economy of Belarus shows that its close relationship with the Russian Federation has an important place. The foreign trade deficit, which has been on the rice in recent years, can be associated with the faltering competitive power in the Russian market and the negative affects resulting from shrinking demands after the financial crisis. Political and economical problems in the Russian Federation may also have direct effect on Belarus. Close economical and political relationship with the Russian Federation leads to a potential of being the first to suffer from the negative conditions.

Estonia is a transit country in global trade, with its central location and transportation network, which opens up primarily to the Baltic Region, Russian Federation and Nordic countries. Thanks to the actions Estonia has taken to facilitate bureaucratic obstacles, expand digital services and offer new advantages for foreign investors, the country has become one of the most open economies in the world. In this aspect, Estonia is one of the leading European countries in terms of convenience to conduct business and economical freedom indexes of various institutions.

Latvia has achieved a growth of an average 10% per year between 2003 and 2007. This growth was a result of foreign borrowing rather than an increase in production. In the last quarter of 2008, its economy came to a stagnation as a result of the global financial crisis. With the crisis in 2009, it became the fastest shrinking economy in the EU. The government based its strategy to overcome the crisis on “export-driven growth” after 2010, instead of “import-driven growth supported by foreign loans.” With a growth rate of 4% achieved in 2013, Latvia become one of the most favourable economies in the EU.

The economic recovery and growth thrust of Lithuania, which was achieved after 2004 thanks to the political stability brought by EU membership, came to halt in late 2008 as a result of global financial crisis, and 2009 its economy shrank by 15%. In 2010, the economy showed a tendency to grow again, in line with the objectives of the government, and this growth trend was sustained in the following years. Lithuania started using Euro as a currency on June 1, 2015, and thus became the 19th member country to enter the Euro Zone.

THE ROLE AND IMPORTANCE OF AGRICULTURE 23% of the land of Belarus is non-arable as the radiation level exceeds the levels that is acceptable for human health. The share of agriculture in economy is gradually shrinking. The labour force employed in the agricultural industry has also been decreasing. The primary agricultural products are potato, grain and animal products.

Belarus implements price control upon the products considered as “socially significant” which mostly consist of processed agricultural products. There are 27 products in this list; they are bread, milk, meat and meat products, egg, oil, cereals, canned fruits and vegetables, flour, pasta, fruit juice for children, cheese, fish, salt, coffee, tea and some baby formulas etc.

The economy of Estonia is based on industry. However, agriculture also contributes significantly to the economy. Since its lands are non-arable, approximately half of the plant production consists of grass for animal feed.

In Lithuania, agricultural industry comprises a small portion of GDP, and employs 8.2% of the total labour force in the country. Before the agricultural reforms, agricultural and food production was the second biggest industry, amounting to almost 28% of GDP. This share remarkably decreased during the transition period, finally going down to 6.7% in 1994. Its top products are potato, wheat and sugar beet.

Agricultural industry that shares the 4% of GDP in Latvia employs nearly 8% of total workforce. Although the number of people employed in agricultural industry and the share of GDP in agriculture decreased over the years, efficiency has increased through the modernization process implemented in agricultural production in recent years. Moreover after Latvia became a member to EU in 2004 agricultural industry started to liberalize rapidly and the country received more assistance programs of EU.

Since the country consists of fertile lands, agriculture and forestry provide significant amount of input to the production industries. Wheat is the most significant agricultural product and barley, oats and rye are also produced in significant amount. Therefore, flour and bakery products industry is a developed one and shares one quarter of agriculture and food exports of the country. In accordance with the demands of consumers, production of organic flour products has also begun.

GRAIN PRODUCTION IN BELARUS According to the data from Food and Agriculture Organization (FAO) of the United Nations, the top grain produced in Belarus is wheat. According to the data collected between 2006 and 2014, the wheat production approximately amounts to a number between 1 million tons and 2,9 million tons. Belarus produced 2,1 million tons of wheat in 2011, which rose to 2,5 million in 2012. The amount of production went down again to 2.1 million tons 2013, but rose back to 2.9 million tons in 2014.

Another significant agricultural product in Belarus is barley. The amount of barley produced here changes between 1.8 million tons and 2.2 million tons. Barley production which was 1.9 million tons in 2011 and 2012 went down to 1.6 million tons in 2013. The amount of barley produced in 2014 was 1.9 million tons. Another important product is corn. From 2006 to 2014, corn production in Belarus exceeded 1 million tons only in 2011 and 2013. The amount of corn produced in 2014 was 599,000 tons.

GRAIN PRODUCTION IN ESTONIA According to the data of FAO, the top agricultural product of Estonia is wheat. Wheat production was recorded at amounts changing between 200,000 and 600,000 from 2006 to 2014. The amount produced in 2011 was 360,000 tons, which rose to more than 400,000 tons in 2012 and 2013, and reached 615,000 tons in 2014. Another important agricultural product in Estonia is barley. The amount of barley produced in 2011 was 294,000 tons. In 2012, the amount went up to 341,000 tons, and in 2013 it reached 441,000 tons. The production of barley continued to increase in 2014, reaching 458,000 tons. The amount of rye and oat produced in Estonia does not reach 100,000 tons.

GRAIN PRODUCTION IN LATVIA The leading grain produced in Latvia is wheat. The wheat produced in 2009 was more than 1 million tons, and in 2012 the produced amount was 1.5 million tons. The wheat produced in 2013 and 2014 was 1.4 million tons. Another important agricultural product in Latvia is barley. Having produced approximately 200,000 tons of barley from 2009 to 2003, Latvia produced 418,000 tons of barley in 2014. The amount of rye and oat produced in Latvia is approximately 100,000-150,000 tons.

GRAIN PRODUCTION IN LITHUANIA According to the FAO data, the top grain produced in Lithuania is wheat. From 2006 to 2001, the amount of wheat produced was less than 2 million tons, but in 2012 the amount went up to 2.9 million tons, and then down to 2.8 million tons in 2013. The amount of wheat produced in 2014 was 3.2 million tons. Another important grain produced in Lithuania is barley. The amount of barley produced in 2011 and 2012 was approximately 750,000 tons, which went down to 685,000 tons in 2013 and then up to 1 million tons in 2014. The amount of corn and oat produced in Lithuania is approximately 150,000 tons. GRAIN TRADE IN BELARUS Grain trade in Belarus is dominated by wheat and corn. Focusing on imports rather than exports to address domestic demand, Belarus has a shrinking import amount which goes parallel to the increase in wheat and corn production. According to the FAO data, wheat imports in Belarus was 184,000 tons in 2012, which went down to 44,000 tons in 2013. The country imported 94,000 tons of corn in 2012, and 84,000 tons of corn in 2013.

GRAIN TRADE IN ESTONIA Grain trade in Estonia is dominated by wheat and barley. With an increasing production of wheat and barley, Estonia also has an increasing amount of exports of these products. It exported 70,000 tons of wheat in 2011, which went up to 251,000 tons in 2012, and further up to 226,000 tons in 2013. The export of barley is also on the rise. Estonia exported 184,000 tons of barley in 2011, and although the amount fell to 84,000 tons in 2012, it achieved to go up to 170,000 tons in 2013. GRAIN TRADE IN LATVIA Just like in Estonia, wheat and barley are the two main products in Latvia. Exporting 112,000 tons of wheat in 2011, Latvia increased this amount to 251,000 tons in 2012. The amount of imports recorded in 2013 was 204,000 tons. The amount of exported wheat also gradually increased to more than 1 million tons, starting from 2009. The amount of exports went down to 468,000 tons in 2011, but later it started to increase again, and reached 1.4 million tons in 2012 and 1 million tons in 2013.

The amount of barley exported from Latvia changes between 100,000 and 180,000 tons. The amount of barley exported was 132,000 tons in 2011, 113,000 tons in 2012, and 134,000 tons in 2013. The amount of barley imported was approximately 100,000 tons in 2010, 2011 and 2012, which went down to 87,000 tons in 2013.

GRAIN TRADE IN LITHUANIA In Lithuania, where grain trade is dominated by wheat and barley, the amount of exports surpass the amount of imports. The amount of wheat exported in 2001 was more than 1 million tons, which went down to 808,000 tons in 2011, but later rose back to 1.6 million tons in 2012. Gradually increasing amount of barley exports reached 1.9 million tons in 2013. The amount of exported barley was 204,000 tons in 2011, which decreased to 101,000 tons in 2012. The export of barley was later back on the rise, reaching 278,000 tons in 2013.

FLOUR TRADE IN BELARUS, ESTONIA, LATVIA AND LITHUANIA According the the FAO data, the amount of wheat flour exported by Belarus has been changing between 10,000 and 20,000 tons in the last five years. A total of 15,000 tons of wheat flour was exported from Belarus in 2012, and this amount fell to 10,000 in 2013. Imports of wheat flour is on the rise in Belarus. The amount of imports, which was 9,000 tons in 2011 went down to 6,000 in 2012, but then reached 11,000 tons in 2013.

The exported amount of wheat flour is gradually increasing in Estonia. Exports of wheat flour, which was recorded at 9,000 tons in 2011, rose to 14,000 tons in 2012, and then fell to 13,000 tons in 2013. The imports of wheat flour has been recorded at amounts changing between 15,000 and 21,000 tons in the last five years. While 21,000 tons of wheat flour was imported in 2012, the amount fell to 18,000 tons in 2013.

Latvia exported 28,000 tons of wheat flour in 2011, and the amount later increased to 51,000 tons in 2012. The amount exported in 2013 was 42,000 tons. The amount of imports recorded at 6,000 tons in 2011 went up to 9,000 tons in 2012, and to 12,000 tons in 2013.

The amount of exports of wheat flour in Lithuania is less than 20,000 tons. While 11,000 tons of wheat flour was exported in 2011, the amount went up to 12,000 tons in 2012, and to 18,000 tons in 2013. The amount of imports of wheat flour reached 29,000 tons in 2011; however, the amount went doen to 23,000 tons in 2012. The imported amount was 24,000 tons in 2013.

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