Iran's Foreign Non-Oil Trade at $9.3 Billion in 2 Months

EghtesadOnline: Iran’s foreign non-oil trade stood at $9.34 billion in two months ending May 20, of which exports accounted for $4.3 billion and imports $5.04 billion, the spokesperson of the Islamic Republic of Iran Customs Administration said.

News ID: ۷۵۰۱۵۰

02 June 2020

The country posted a trade deficit of $741 million over the first two months of the current year.

Noting that Iran traded over 21 million tons of non-oil goods during the period, Rouhollah Latifi added that exports weighed 14.5 million tons and imports 6.5 million tons, IRICA’s website reported.

Compared with the corresponding period of last year (March 21-May 21, 2019), exports registered a 52% and 49% decline in weight and value respectively.

Year-on-year comparison of imports shows a decrease of 4% in weight and 11% in value.

“During the second month of the current Iranian year (April 20-May 20), non-oil exports hit 9.17 million tons worth $2.64, indicating an increase of 71% in weight and 60% in value compared with the preceding month,” Latifi said.

“Imports grew by 53% in weight and 61% in value month-on-month to reach 3.87 million tons worth $3.11 billion.”

A total of 5.34 million tons of non-oil goods worth $1.65 billion were exported and 2.52 million tons worth $1.93 billion were imported during the month ending April 19.

Iran’s non-oil exports during the month to May 20 registered a 5.1% growth in weight but a 4.5% decline in value compared with the month ending March 19. One-month imports show a 31% increase in weight but an 18% decline in value compared with the month ending March 19.

The IRICA spokesman said China was Iran’s main export destination, purchasing $1.19 billion worth of non-oil goods from us during the two-month period to account for more than 27% of Iran’s total exports.

“It was followed by Iraq with $1.1 billion and a share of more than 25% of Iran’s exports, the UAE with $682 million and the share of 15%, Afghanistan with $341 million and the share of 8% and Turkey with $144 million and the share of more than 35 from Iran’s total exports,” he added.

Top exporters to Iran were China with $1.23 billion, the UAE with $1.07 billion, Turkey with $535 million, Russia with $356 million and India with $335 million, he was quoted as saying by Otaghiranonline.ir.

Germany is no longer among the top five exporters to Iran, as it has been overtaken by Russia.

Decline in Exports Expected Over Coronavirus

Iran has to prepare for a 30% decline in its export value in the current Iranian year (March 2020-21) compared with last year due to the impact of the spread of the novel coronavirus on national and international trade, a member of Iran Chamber of Commerce, Industries, Mines and Agriculture’s Board of Directors said.

“Under the current circumstances, it is estimated that the country’s exports will fall between $10-12 billion compared with last year. The main products that will experience a plunge due to the pandemic are petrochemicals, steel, mineral products, tile, ceramics and nuts,” Pedram Soltani was also quoted as saying by ISNA.

According to Mehdi Mirashrafi, the head of Islamic Republic of Iran Customs Administration, Iran’s non-oil foreign trade stood at $85 billion in the fiscal 2019-20, of which exports accounted for $41.3 billion and imports for $43.7 billion.

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

Noting that Iran traded over 169 million tons of goods last year, the ICCIMA member said exports weighed 133.9 million tons—three times as much as imports in weight and about 13.5% more than in the previous year.

In terms of value, however, exports show a 7% decline year-on-year, Mehr News Agency reported.

“Imports reached 35.3 million tons in the fiscal 2019-20, indicating a 9.3% growth year-on-year. A $2.4 billion trade deficit was registered for the country during the period under review. Raw materials, machinery and intermediate goods accounted for 85% of the imports,” he said.

“Petrochemicals made up the lion’s share of exports, which indicates that the country is moving from being dependent on selling unprocessed goods toward exporting petroleum products. However, the fact that each ton of Iran’s imports was valued at $1,220 while each ton of exports was worth only $309 indicates that exports of unprocessed goods poses a challenge to Iran’s economy.”

According to Soltani, prices of Iranian products have increased as a result of a rise in the prices of raw materials. He said the economy will continue to grapple with high inflation rates in the year ahead.

Soltani, also a former deputy head of ICCIMA, added that China is most likely the least affected economy by the pandemic and since it is Iran’s top trading partner, hopefully exports to this country will remain unaffected.

“Yet, the outbreak of Covid-19 as well as the decline in oil prices will make Iraq, our second biggest export destination, very cautious and we will be facing limitations on the commodities we can export to the neighboring country,” he said.

China was Iran’s main export destination last year, importing $9.5 billion worth of non-oil goods from Iran. It was followed by Iraq with $8.9 billion, Turkey with $5.4 billion, the UAE with $4.5 billion and Afghanistan with $2.3 billion.

China was also the biggest importer from Iran last year. The Asian country sold $11.2 billion worth of non-oil goods to Iran last year. The UAE with $8.9 billion, Turkey $4.9 billion, India $3.6 billion and Germany with $2.1 billion worth of exports to Iran were other main importers from Iran.

Iran was the biggest exporter to Iraq in the fiscal 2018-19.

Soltani noted that based on World Trade Organization’s prediction, world trade will plunge by 13-32% in 2020 (in terms of best- and worst-case scenarios), noting that it is likely that the global economic crisis ahead will be more intense than the one experienced in 2008.