(Bloomberg) -- Iraq plans to boost its wheat output by almost 60% this year, even as it continues to rely on imports to satisfy domestic demand. 

The country is expected to produce 3.5 million tons of wheat this year, up from about 2.2 million tons last year, according to Haider Nouri, director general of Iraq’s grain board. The nation will also seek to buy at least 50,000 tons this month via tender, he said during an interview in Baghdad.

Iraqi wheat growers have started their harvest and will officially begin marketing the staple to the trade ministry’s silos on Tuesday. The government — which runs a subsidy program that distributes 4.6 million tons of the commodity a year — buys local wheat at almost double the global price in order to encourage production by domestic farmers. 

Iraq last year ordered the purchase of a million tons of wheat to make up for a production shortfall. Its output is highly dependent on rain and water flows from the Tigris and Euphrates rivers. 

In recent years, the country has been purchasing wheat from three sources: the U.S., Australia and Canada. “Those are the best three origins that fit for making our Iraqi bread as they the hard and contain high gluten,” Nouri said. 

Benchmark wheat futures on Monday rose for the first time in a week, as Russia warned of risks to the Black Sea grain deal. Still, global wheat prices are favorable, considering Russia’s war in Ukraine, Nouri said.

Iraq’s grain board is working to upgrade its grain storage silos. In the final quarter of the year, it plans to build a silo with a capacity of 60,000 tons in the southern province of Diwaniya. The facility, expected to cost as much as $27 million, will receive some funding from Saudi Arabia. Five of Iraq’s 27 silos were previously damaged during conflict with Islamic State militants.    

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