Iran’s Silo Capacity of Strategic Goods Reaches 21m Tons

EghtesadOnline: Iran’s storage capacity for strategic goods and grains has reached 21 million tons, says an official with Government Trading Corporation of Iran, a subsidiary of Agriculture Ministry.

News ID: ۷۵۰۲۰۴

09 June 2020

“The capacity of government-owned storage units stands at 5.5 million tons with 156 silos, mechanized or semi-mechanized storehouses and simple warehouses and that of private-owned units hovers around 15.5 million tons with 600 cement and metal silos, as well as mechanized storehouses,” Qodrat Heydari was also quoted as saying by IRNA.

“The government has no worries about food security, particularly regarding wheat. However, we welcome investment in sectors that need it most.”

The Agriculture Ministry is expecting wheat production to exceed 14 million tons this year.

Close to 2 million hectares of wheat farms (one-third) in Iran are irrigated and 4.05 million hectares (two-thirds) are rain-fed.

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

Mojtaba Palouj, a member of Agricultural Planning, Economic and Rural Development Research Institute, says, “An estimated increase of 3 million tons of agricultural products is expected in crops such as wheat, barley, colza and oilseeds.

According to Ataollah Hashemi, the head of National Wheat Farmers Foundation, wheat has been cultivated across 6.2 million hectares of land this year.

Over 3m Tons of Essential Goods Transported Since March 20

A total of 3.03 million tons of essential goods have been transported to different destinations across the country since March 20, Hassan Fallah-Nejad, another senior official with GTC, said.

“This year, we are aiming for an optimized storage strategy to keep the costs as low as possible. For example, over previous years, there was a one-month gap between the guaranteed purchase of wheat and their delivery to destinations across the country; they would be kept in silos for a month. The deliveries of wheat have been timed to coincide with the time they are purchased,” he added.

By May 31, a total of 4.17 million tons of essential goods had been unloaded at Iranian ports, of which Imam Khomeini Port accounted for more than 3 million tons, according to Mehrdad Jamal-Arvanaqi, the deputy head of the Islamic Republic of Iran Customs Administration.

The remaining imported essential goods, including wheat, corn, oilseeds, barley, sugar, vegetable oils and soybeans, had been unloaded at ports of Shahid Rajaee, Amirabad, Shahid Bahonar, Bushehr, Khorramshahr, Noshahr and Fereydounkenar, he added.

“About 559,000 tons of essential goods are being discharged at Imam Khomeini Port, 5,500 tons at Anzali Port and 9,743 tons at Amirabad Port. All in all, 16 vessels are unloading 574,427 tons of essential goods at these three ports,” he was quoted as saying by Fars News Agency recently.

Noting that 21 vessels are waiting to dock at five main ports, the official said, “They are carrying 669,429 tons of corn, sugar and oilseeds; five of these cargo ships are carrying 18,000 tons of corn and barley to Anzali Port and three of them are carrying 154,734 tons of wheat and vegetable oil to Shahid Rajaee. Two main essential goods stored at Iranian ports are corn (2.31 million tons) and barley (581,000 tons).”

A total of 25.09 million tons of essential goods worth close to $15.5 billion were imported into Iran during the last fiscal year (March 2019-20) to register a 20.77% and 17.13% increase in weight and value respectively compared with the year before, according to the spokesman of the Islamic Republic of Iran Customs administration, Rouhollah Latifi.

“This amount of essential goods imports accounted for close to 71% and 35% of the volume and value of last year’s total imports respectively,” the official was quoted as saying by ISNA.

“The imported essential commodities included wheat, sugar, corn, rubber, barley, processed tea, rice, different kinds of seeds, red meat, soybeans, pulses, paper, chemical fertilizers and industrial machinery.”

Also known as necessity goods, essential goods are products consumers will buy, regardless of changes in income levels.

Biggest Silo in East Under Construction

A silo for storing wheat with a capacity of 100,000 tons is being constructed in Semnan Province’s Garmsar city.

According to the head of Semnan Agricultural Jihad Organization, it will be the biggest silo in the east of the country.

“The silo is being built on over 10 hectares of land and has had 92% progress. It will be inaugurated in summer,” Hassan Miremad was also quoted as saying by IRNA.

The Islamic Development Bank and the government have jointly invested in this project and hold 89.2% and 10.8% of shares respectively.

“The Islamic Development Bank has invested €18.96 million and the government around 190 billion rials [$1.34 million]. When inaugurated, the silo will help resolve a major part of the wheat storage problems in the region and the country by extension,” he said.

Miremad noted that Semnan is located on the crossroads of North-South and East-West transit corridors, enjoys connectivity to the national rail network, neighbors nine other provinces, is located close to Tehran’s huge market and has favorable weather for storing grains and is the right spot for building this capacious silo.