Domestic Production Meets 95 Percent of Food Demand

EghtesadOnline: Ninety-five percent of food demand in Iran are met by domestic production, a board member of the House of Industry, Mine and Trade of Iran said.

News ID: ۷۵۰۱۱۱

27 May 2020

Mehdi Karimi Tafreshi added that about 130 million tons of food are produced by local companies annually, ILNA reported.

“Unlike what most people think, the development and completion of the production chain generate added value rather than the production of raw materials by mainstream industries. Statistics show food production constitutes over 10% of the added value of industrial sector. Much of the industries are currently in recession, but a significant share of Iran's gross domestic product comes from food industries,” he said.

“Given the slower pace of population growth and the decline in consumers’ purchasing power, the development of food industries would depend on their presence in regional markets. Russia, Iraq and Oman are among Iran’s key destinations for food products.”

Tafreshi noted that estimates put the overall turnover of Iranian food industries at around $100 billion.

“The food industry is the biggest in terms of generating added value and jobs. Out of the country’s 13,000 industrial workshops, 2,500 are dedicated to food production, and they account for 16.8% of total employment,” he said.

Agrifood Exports at $5.8b

Latest data released by the Agriculture Ministry show Iran exported 7.1 million tons of agricultural and food products worth over $5.82 billion in the last fiscal year that ended on March 19, 2020, to register a 2.34% rise in tonnage and an 8.93% decline in value compared to the year before.

In-shell pistachio (fresh and dried) topped the list of exports in terms of value, as the country exported $724.2 million worth of the crop during the period.

Apple was the second major exported agricultural product in terms of value with $362.27 million followed by tomatoes with $259.21 million, unshelled pistachios with $240.58 million and watermelon with $175.97 million.

In term of tonnage, watermelons topped the list with 748,090 tons, followed by apples with 740,220 tons, tomatoes with 572,940 tons, potatoes with 480,440 tons, and onions and Persian shallot with 394,990 tons.

Horticultural products accounted for 1.95 million tons worth $2.72 billion of total exports, up 30.03% and 19.72% in tonnage and value respectively year-on-year. Exports of agronomical products stood at 4.41 million tons worth $2.09 billion, down 5.2% and 20.42% in tonnage and value respectively YOY.

Exports of livestock and poultry products stood at 586,400 tons worth $718.87 million, down 7.01% and 34.05% in tonnage and value respectively YOY.

The fisheries sector exported 126,590 tons worth $249.3 million, up 4.58% in tonnage and down 25.21% in value YOY.

Exports from the forest and rangeland sector hit 19,080 tons worth $31.2 million, down 29.45% and 46.19% in tonnage and value respectively YOY.

The veterinary sector’s exports amounted to 350 tons worth $2.31 million, up 16.23% in tonnage and down 27.68% in value YOY.

Agrifood Imports at $12.5b

Imports during the same period stood at 24.67 million tons worth $12.58 billion, indicating a 20.5% and 17.46% increase in tonnage and value respectively year-on-year.

Field corn had the biggest share in total imports in terms of value with $2.17 billion, followed by semi-polished and polished rice with $1.68 billion, barley with $1 billion, oilcake with $950.42 million and soybean with $905.43 million.

In terms of tonnage, field corn topped imports with 8.91 million tons, followed by barley with 4 million tons, soy oilcake with 2.19 million tons, soybean with 2.08 million tons and unrefined sugar with 1.81 million tons.

Agronomical products accounted for 23.02 million tons worth $9.56 billion of total imports, up 20.91% and 19.2% in tonnage and value respectively YOY.

Horticultural products stood at 1.27 million tons worth $1.42 billion, up 14.04% and 10.32% in tonnage and value respectively YOY.

Imports of livestock and poultry products hit 311,810 tons worth $1.39 billion, up 17.58% and 13.07% in tonnage and value respectively YOY.

The veterinary sector imported 1,270 tons worth $79.01 million, up 2.05% and 6.22% in tonnage and value respectively YOY.

Imports by the fisheries sector amounted to 26,540 tons worth $71.82 million, up 12.04% and 22.18% in tonnage and value respectively YOY.

Imports from the forest and rangeland sector totaled 34,950 tons worth $54.68 million, up 37.37% and 52.5% in tonnage and value respectively YOY.

The export and import figures indicate that Iran recorded a trade deficit of 17.57 million tons in tonnage and $6.76 billion in value during the year in review.

Abundant Rainfalls to Boost Crop Yields by 3m Tons

Agricultural yields are expected to improve by 3 million tons, thanks to the current good rainfall year. Unlike last year, when downpours and floods caused significant damages to farmers, the increased precipitation received in arid and semi-arid provinces is expected to lead to a bumper harvest in the current fiscal year (started March 20).

Out of nearly 18 million hectares of Iran's farmlands, 12 million hectares are rain-fed. The impact of rainfalls is more significant in arid areas in the central, southern, eastern and southeastern regions struggling with water shortages, drought and extended dry seasons since most of their farms are rain-fed.

“Precipitation this year has declined by 5% compared with last year but improved by 32% over the long-term average,” Esmaeil Esfandiyarpour, an official with Agriculture Ministry, told the Persian-language daily Iran.

“Eight provinces with warmer climate have begun wheat harvest; thus far 1.33 million tons of the crops have been delivered to silos. Wheat harvest will continue through September. Projections show more than 14 million tons of wheat will be produced this year.”

Noting that close to 2 million hectares of wheat farms (one-third) in Iran are irrigated and 4.05 million hectares (two-thirds) are rain-fed, Esfandiyarpour said wheat farms grown under rainwater harvesting give the best grain yields compared to their irrigated counterpart.

“Fars Province, for example, received twice as much precipitation as last year’s; farmers are anticipating an abundant wheat crop. The province has received 400 millimeters of rain on average this year over last year’s 251 millimeters. Rainfalls this year reduced soil salinization [the increase of salt concentration in soil] that resulted from 20 years of droughts, strengthening the prospects of the rise in production in dry areas.”

Farmers say the lushness of rain-fed wheat produced this year is similar to crops grown in irrigated fields.

Rainfalls have also improved rice production and encouraged agriculture officials to issue cultivation permits for this most water-intensive crop in provinces other than northern ones. With more rain last year, the southern province of Khuzestan became one of the top producers of rice following northern provinces. Rice output exceeded two million tons last year. The country was almost self-sufficient in production of this strategic good.

“All provinces that enjoy bountiful water resources due to the recent high levels of precipitation and those with favorable weather conditions and adequate raw materials [seeds, fertilizer] can engage in rice cultivation this year. These provinces have also been allowed to dedicate more land to this cultivation,” Jamil Alizadeh Shayeq, the head of Iran Rice Association, has been quoted as saying by Young Journalists Club.

A total of 2.9 million tons of rice were produced in Iran in the last Iranian year (March 2019-20), registering a 45% increase compared with the previous year, according to director general of the Agriculture Ministry’s Grains and Essential Goods Bureau.

“This increase in rice output owes to the favorable weather and heavy precipitations during February and March of 2019, because of which land under rice cultivation increased by 38% to reach 834,000 hectares,” Faranak Aziz Karimi was quoted as saying by IRNA.