"Any attempt to market imported wheat by claiming it is of local origin, in order to benefit from subsidies given by the government, is considered criminal theft of public funds," it said in a statement.

The Grain Board is paying farmers 420,000-560,000 Iraqi dinars ($354-$472) per tonne of local wheat during the 2018 harvest, unchanged from last year.

The price, well above global market prices, is designed to encourage local growing of the crop.

But it has also historically been an incentive for smuggling cheaper origins into Iraq and selling them to the state as Iraqi wheat.

The new chief of the Grain Board has said he expects local wheat production of at least 2.5 million tonnes in the 2018 season, an improvement over previous forecasts due to recent rainfall. nL8N1QV3AT

Iraq needs an annual wheat supply of between 4.5 million and five million tonnes, implying an import gap of around two million tonnes for the year.