Iran's Agrifood Exports Top $2.7 Billion

EghtesadOnline: Iran exported 3.58 million tons of agrifood products worth over $2.79 million during the first seven months of the current Iranian year (March 21-Oct. 22).

News ID: ۷۴۹۱۱۸

07 December 2019

“This accounted for 11.42% of Iran’s total non-oil exports during the period,” Deputy Agriculture Minister Abdolmehdi Bakhshandeh told ILNA.

“Iran’s main export destinations were Iraq, Afghanistan, the UAE, Pakistan, Russia, India, Turkey, Vietnam, Turkmenistan and Germany.”

The official noted that gourds totaling 871,000 tons, fresh and processed tomatoes 400,000 tons, onions and shallot 263,000 tons, fresh and processed potatoes 201,000 tons and apples amounting to 114,000 tons were the main agricultural exports in terms of weight, according to Financial Tribune.

Dairy products worth $320 million, pistachios $291 million, gourds $271 million, fresh and processed tomatoes $239 million and saffron valued at $107 million were the main exports in terms of value.

Bakhshandeh noted that 2.56 million tons of agronomical exports worth $1.27 billion had the largest share in terms of weight and value.

“The lion’s share of exports in agronomical products pertained to 1.32 million tons of vegetables worth $655 million. The main exported vegetables were gourd vegetables with 871,000 tons worth $271 million, fresh and processed tomatoes with 400,000 tons worth $239 million, fresh and processed potatoes with 201,000 tons worth $95 million, onions and shallots with 263,000 tons worth $131 million, and medicinal plants with 31,000 tons worth $23 million,” he said.

The second subcategory with the largest share in agrifood exports was 595,000 tons of horticultural products worth $950 million.

The main exported products, according to Bakhshandeh, were pistachios exceeding 34,000 tons worth $291 million, 101 tons of saffron worth $107 million, 84,000 tons of dates worth $75 million, 114,000 tons of apples worth $69 million and 52,000 tons of grapes worth $65 million.

In addition, 4,000 tons of tea worth $4 million were exported during the seven months.

The third subcategory with the biggest share in Iran’s agrifood exports was 354,000 tons of livestock products worth $453 million tons.

“Exports of milk and dairy products amounted to 267,000 tons worth $320 million. The main exported goods in this subcategory were 45,000 tons of cheese and dried whey worth $91 million, 63,000 tons of milk and cream worth $79 million, 25,000 tons of ice-cream worth $61 million and 123,000 tons of yoghurt worth $69 million. Also, 23,000 tons of eggs and 22,000 tons of Iranian chicken worth $34 million and $23 million respectively were exported during the period,” Bakhshandeh said.

The subcategories of fisheries with 58,000 tons, forests and ranges with 9,000 tons and veterinary medicine with 110 tons had a $106 million, $15 million and $1 million share in the country’s agrifood exports.

Imports at $7.4b

Bakhshandeh noted that during the seven months under review, 13.69 million tons of agrifood products worth $7.45 billion were imported into Iran, accounting for 29.76% of Iran’s total non-oil imports over March-October 2019.

The main imported products in terms of weight, said the official, were field corn with 4.86 million tons, barley with more than 1.84 million tons, soybeans with 1.68 million tons, unrefined sugar with 1.22 million, and soymeal with 1.1 million tons, while in terms of value these were field corn worth $1.2 billion, semi- or wholly-milled rice worth $1.03 billion, soybeans worth $726 million, soymeal worth $488 million and barley worth $477 million.

Based on the above figures, Iran registered a $4.66 billion trade deficit in agrifood trade during the period.

85% of Agro Self-Sufficiency

Former agriculture minister, Mahmoud Hojjati, (recently resigned) had said Iran meets 85% of its demand for agricultural products domestically and the rest is secured through imports.

According to the minister, $80 billion worth of agricultural products are produced in Iran every year, $75 billion of which are consumed inside the country.

Director General of the Ministry of Industries, Mining and Trade's Food, Medicine and Toiletries Industries Department Mehdi Sadeqi Niyaraki says 95% of Iran’s food industry are owned by the private sector, noting that the sector accounts for 15% of the country’s industrial employment.

Iran ranks among the top 10 producers of many horticultural products, including but not limited to pistachios, dates, apples, cherries, pomegranates and grapes, in the world.

Agricultural Boost to GDP

A solid increase in agricultural production has been the main driver of economic growth registered in the first quarter of the current Iranian year (started March 21).

Estimates indicate that with 6.5%, the agriculture sector saw the highest growth among Iran's economic sectors in Q1. The rate for last year's corresponding period stood at 0.3%.

According to Central Bank of Iran's Governor Abdolnasser Hammati, growth has returned to Iran's non-oil sector.

"The first three months of the year [13]98 [current Iranian year that started on March 21], saw the non-oil sector, which is the productive sector of the economy, grow 0.4% compared with the corresponding period of [13]97 [last Iranian year]," the CBI chief wrote in a piece published on the central bank's website.

The significant boost in agricultural production owes largely to abundant rainfall at the beginning of the year, which led to increased yields of crops.

Agrifood Products Account for Half of Iran-EEU Trade

Iran traded 2.52 million tons of agrifood products worth 1.09 billion with the Eurasian Economic Union during in last Iranian year (March 2018-19), according to Shahrokh Shajari, director general of the Ministry of Agriculture's Export Expansion Bureau.

Data released by the Islamic Republic of Iran Customs Administration show Iran traded a total of 4.04 million tons of non-oil commodities worth $2.09 billion with the five EEU member states during the same period, registering a 22.96% and 34.08% increase in tonnage and value respectively compared with the previous year.

Agrifood trade accounted for 62.37% and 52.15% of the volume and value of Iran-EEU total non-oil trade respectively last year.

Iran exported 1.55 million tons of non-oil commodities worth $607.43 million to the union last year.

“Iran’s agrifood exports to EEU member states stood at 405,010 tons worth $315.3 million during the 12-month period,” Shajari was quoted as saying by ILNA.

The above figures account for 26.12% and 51.9% of the weight and value of total non-oil exports to EEU respectively over the period.

Iran's agrifood exports to EEU mainly include apples, vegetables, grapes, oranges, raisins, dates, kiwi and pistachio.

Around 2.49 million tons of non-oil products worth $1.48 billion were imported from EEU members during the 12 months, based on IRICA figures.

According to Shajari, 2.12 million tons worth $776.37 million of the total imports were agrifood products.

As such, 85.14% and 52.43% of the volume and value of Iran’s total non-oil trade with EEU respectively were agrifood products.

The Preferential Trade Agreement between Iran and EEU came into effect on Oct. 27.

“The agreement is a prelude to free trade with Eurasia. Preparations for free trade with the bloc will begin after one year of implementation, following which there will be a two-year window to conclude negotiations," Hamid Zadboum, the head of Trade Promotion Organization of Iran, has been quoted as saying by Fars News Agency.

Iran and EEU are looking to substantially increase trade. The two sides signed a three-year provisional agreement in Astana, Kazakhstan, on May 17, 2018, for the bloc to welcome Iran into EEU.

The average tariff set by the union on Iranian goods as part of the agreement stands at 3.1%, while the figure is 12.9% for EEU goods exported to Iran.

Iran and EEU have listed 862 types of commodities in their provisional agreement, based on which Iran will enjoy easier export terms and lower customs duties on 502 items and the same goes for 360 items from EEU member states.

“Of the 862 items mentioned in the agreement, 639 are industrial commodities and the remaining 223 items are agricultural goods,” the deputy head of Iran Chamber of Commerce, Industries, Mines and Agricultures, Mohammad Reza Karbasi, was quoted as saying by ICCIMA’s news portal as saying.