Iran's Non-Oil Trade Declines 27%

EghtesadOnline: Iran’s foreign non-oil trade stood at $3.58 billion in the month ending April 19, indicating a 27% decline compared with the same period of last year.

News ID: ۷۵۰۰۰۳

09 May 2020

A total of 5.34 million tons of non-oil goods worth $1.65 billion were exported during the one-month period, registering a 39% and 36% decline in weight and value respectively.

Imports hit 2.52 million tons worth $1.93 billion, posting a 21% increase in weight but a 17% decrease in value year-on-year.

Iran’s trade deficit stood at $279 million over the month under review, the Persian-language economic daily Donya-e-Eqtesad reported.

Oil-based products and byproducts as well as petrochemical products are included in the Islamic Republic of Iran's Customs Administration's "non-oil" export data. In fact, petrochemicals and gas condensates constitute the greater share of total exports.

China was Iran’s main export destination during the period with more than $523 million, accounting for nearly 32% of Iran’s total exports.

The UAE overtook Iraq as Iran’s second export destination. The country imported $355 million worth of non-oil goods from Iran to account for 21.5% of Iran’s overall exports.

Exports to Iraq hit $259 million; the neighboring country accounted for 16% of Iran’s total exports.

With imports worth $125 million, Afghanistan accounted for 7.5% of Iran’s one-month total exports. It was followed by Turkey with imports worth $72 million and a share of 4% from overall exports.

China was also the biggest source of imports, as $399 million worth of non-oil goods were imported to Iran last month, accounting for 21% of Iran’s total imports.

The UAE with $394 million and a share of 20%, Turkey with $246 million and a share of 13% and India with $164 million and a share of 8% followed.

The Netherlands overtook Germany as Iran’s fifth trading partner in imports during the first fiscal month (started March 20). The European country exported $108 million worth of non-oil goods to account for 5.5% of Iran’s total imports.

Covid-19 Impact

The decline in trade comes, as many countries imposed restrictions on commercial exchanges amid the spread of the coronavirus disease (Covid-19).

According to Spokesman of the Islamic Republic of Iran Customs Administration Rouhollah Latifi's latest account of Iran's border crossings with neighboring countries, Pishin border crossing, a gateway to neighboring country Pakistan, reopened on May 2.

The border crossing, which is located in the southeastern Sistan-Baluchestan Province, is now open for trading foodstuff every other day from 8 a.m. to 2 p.m. local time.

A maximum of 20 trucks and 40-50 pickup trucks and mini trucks are allowed to pass through, Mehr News Agency reported on Saturday.

Rimdan border crossing, also on the Iran-Pakistan frontier in Sistan-Baluchestan Province, reopened on April 25 but Mirjaveh border is still closed, the IRICA spokesman said.

Pakistan first closed its eastern and western borders with Iran, Afghanistan and India on March 15 to contain the spread of the new coronavirus.

However, the border crossings of Milak, Mahiroud and Dogharoun are open for trade with Afghanistan.

The head of Iran-Afghanistan Chamber of Commerce said last month that visa issuance for Afghan traders and truck drivers to enter Iran, which had faced a hiatus after the outbreak of the novel coronavirus in the country, is not back to normal.

“Afghan traders can obtain business visa, provided they travel to Iran via plane and carry documented proof that they are not infected with Covid-19,” Mohammad Mehdi Javanmard-Qassab was quoted as saying by Mehr News Agency, adding that truck drivers will only need to submit proof of their being virus-free.

With regard to borders with Turkmenistan, Latifi said all borders with that country remain closed.

As for Uzbekistan, Iranian trucks are now allowed to cross for transit, exports and imports, and the Uzbek government has removed all the restrictions.

Uzbekistan lifted the limitations it had set on Iranian trucks transiting through its territory since the coronavirus outbreak.

Trucks can stay in Uzbekistan for up to 10 days, Latifi was quoted by IRNA as saying, adding that the transit fleet has been required to follow health protocols meticulously.

Uzbekistan’s Crisis Management Commission has lifted the ban for Afghan and Italian transit fleet as well.

Trade with northern neighbors is underway through Caspian Sea ports, namely Anzali, Astara, Caspian, Noshahr, Fereydunkenar and Amirabad.

Marine routes to Russia and Azerbaijan are open. Rail routes to Azerbaijan are also operating. Iranian trucks are also transiting through Russia.

Iran-Armenia Trade is also underway via Nurduz border in East Azarbaijan Province.

Sole Land Border With Turkey Reopens

Bazargan border crossing, located in northwest Iran, has newly reopened following negotiations between Iranian and Turkish authorities.

The capital city of Bazargan District in Maku County, West Azarbaijan Province, is the most important Iranian ground border for importing and exporting from and to Turkey.

According to Spokesman of the Islamic Republic of Iran Customs Administration Rouhollah Latifi, 60 Iranian trucks per day have been allowed to transfer exports to Turkey from Iran as per the new agreements reached on May 5, IRNA reported.

West Azarbaijan’s local customs official, Tohid Azarbod, said last month that amid the coronavirus outbreak, customs activities have been shifted from a number of closed border crossings to the northwestern province.

West Azarbaijan borders Turkey as well as Iraq and Azerbaijan's Nakhchivan Autonomous Republic.

"Tamarchin [bordering the Iraqi Kurdistan] is now open 24 hours a day. The crossings through Tamarchin border terminal was at an all-time high on April 2, with 600 trucks. A total of 9,741 trucks headed to Iraq over the past month,” he was quoted as saying by ILNA.

Razi border-crossing is Iran’s sole rail connection with Turkey. Prior to the opening of Bazargan, all trades were carried out via this gate.

A total of 18,000 tons of goods worth more than $41 million were exported from the Razi border crossing in West Azarbaijan’s Khoy County via 813 cargo wagons during the first months of the current Iranian year (March 20-April 19), showing a sevenfold and 20-fold rise in tonnage and value respectively compared with the similar period of last year, according to the manager of Razi Rail Customs Administration, Seifollah Rasi.

The main exported items were polyethylene, urea, copper ingots and watermelons.

Some 30,000 tons of goods worth around $40 million were transited through Razi border via 1,400 freight wagons over the same period, registering a 2.5-fold increase in weight year-on-year.

Rasi added that since the virus outbreak some two months ago, the border crossing has been working round the clock.

Major Gate to Iraq Reopens

As for border crossing to Iraq, Iran's biggest export destination among neighboring states, Mehran frontier reopened on May 7, IRNA reported quoting Omar al-Waeli, the head of Iraq's Border Ports Authority.

According to the official, the border is open for commercial exchanges for two days each week and thoroughly observes health protocols.

Located in Ilam Province, Mehran has for long been the busiest border between Iran and Iraq.

There is no other crossing open between Iran and Iraq at the moment. That is to say, Shalamcheh, Chazzabeh, and Khosravi frontiers remain closed for commercial exchanges.

Yet, Iran's crossings into the Iraqi Kurdistan (Tamarchin, Parvizkhan, and Bashmaq) have been open all along. The crossings of Siran Band and Sardasht-Kileh opened recently.

Notably, the border crossings of Parvizkhan and Bashmaq have banned trucks until further notice due to the long lines of vehicles waiting there to cross into the Iraqi Kurdistan, according to Mohsen Yazarlou a local official in Golestan Province.

Shipment Details

Latifi noted that Kuwait, the UAE, and Qatar allow imports of metallic and refrigerated watercrafts, but refuse shipments of wooden and traditional watercrafts.

There are three marine routes to Oman, through which mostly food and vegetables are traded, he added.

A new direct marine shipping line between Sultan Qaboos Port in Muscat and Bandar Abbas Port in Iran was launched last month.

Oman’s Port Operation & Management Company (Marafi) said in a post to its Twitter account that the new line comes “in response to the market requirements of vegetables, fruits and foodstuff.”

Marafi invited—in its post—merchants to benefit from this service to meet local demand on the heels of the country’s partial shutdown imposed by the coronavirus outbreak.