The early outlook for the 1997 grain harvest is satisfactory. Bread prices have been liberalized as planned and the area sown to wheat for harvest in 1997 is officially reported to have increased by 60 000 hectares to 495 000 hectares. Growing conditions to date have been mixed, but with more resources being put into wheat production, output could improve, in spite of shortages of agricultural credit, spare parts and inputs.
Dismantling of the State Bread Corporation has not caused disruption in wheat supplies and the need for a sizeable State Wheat Reserve in kind is being reassessed. Following increased production and reflecting higher bread prices as well as foreign exchange constraints, the 1996/97 cereal import requirement is estimated to fall to about 500 000 tons, mostly wheat. The bulk of this will be mobilized commercially but the country has received 6 000 tons of wheat flour to augment state reserves as well as humanitarian supplies for targeted distribution. At present, WFP assists 155 000 persons, mainly people displaced from Nagorno Karabakh, with supplementary food rations. The relief food pipeline is covered until the end of 1997, but WFP also intends to distribute food in 1998.