Iran's Non-Oil Exports to Neighbors Rise 32% to $12.9b in H1

EghtesadOnline: Iran exported $12.95 billion worth of non-oil goods to its 15 neighboring countries during the six months to Sept. 22, registering a 32% growth compared with the same period of last year, data released by the Islamic Republic of Iran Customs Administration show.

News ID: ۷۸۴۲۹۲

05 November 2018

Non-oil exports to the neighboring countries saw a 14% increase in terms of weight during the six-month period to reach 29.2 million tons.

Iraq topped the list of non-oil export destinations of Iran during the period, accounting for 35% or $4.65 billion worth of goods sent to neighboring countries.

LNG ($410 million), tomatoes ($113 million) and ice-cream ($104 million) were Iran’s top exported items to Iraq, followed by dairy products, fruits, air conditioners and steel, according to Financial Tribune.

The UAE and Afghanistan ranked second and third on the list of export destinations for Iranian goods, accounting for 31% and 13% of total exports to neighboring countries respectively.

The highest growth in the value of non-oil exports during the six-month period was registered for Pakistan, as the country imported $571 million worth of goods from Iran, 60% higher than in the previous year.

Bitumen, petrochemicals and oil products were among Pakistan’s main imports from Iran. Fruits, dairy products and dates are also among popular Iranian goods in Pakistan market.

Expansion of rail transport services between Iran and Pakistan has been a key contributing factor to export growth. Non-oil exports to Pakistan, through Zahedan-Mirjaveh Railroad increased by 31% during the first half of the current Iranian year, TINN reported earlier this month.

Non-oil exports to Qatar experienced a 60% growth in the first half of the current Iranian year to reach $140 million.

The highest growth in the value of non-oil exports during the six-month period was registered for Pakistan, as the country imported $571 million worth of goods from Iran, 60% higher than in the previous year

Trade ties between Iran and Qatar entered a new phase after Saudi Arabia and its regional allies cut ties with Doha in June 2017 on the pretext that the emirate supports terrorism–an allegation Qatar vehemently denies.

Ever since, Iran's non-oil exports to the Persian Gulf state have seen a considerable and steady growth, as exporters become more familiar with Qatari market demands in the absence of its traditional suppliers that have placed an all-out embargo on Doha.

IRICA’s list of non-oil exports to Qatar in H1 contains 540 items, topped by bitumen, tomato and construction materials.

The first half of the current year saw Iran’s exports to Oman increase by 57% to reach $444 million.

Eased banking ties, incentives offered by the Omani side to Iranian traders and expanded transport facilities could be the main causes of growth in Iranian exports to Oman.

Officials from both countries have been working hard to expand trade ties in recent years. Efforts are mainly aimed at replacing UAE with Oman–and Qatar for that matter–as the main export destination amid complications posed by the Emirati side on Iranian traders.

Unlike other neighbors, Iran’s non-oil exports to Turkey declined by 21% in H1. Nonetheless, Iran-Turkey trade is expected to get a boost in the coming months, considering the reimposition of US sanctions on Iran and Turkish government’s supportive approach toward Iran.

Caspian States

Turkmenistan and Azerbaijan were the leading importers of Iranian goods among Caspian states during the first six months of the current Iranian year, importing $191 million and $170 million worth of goods, respectively. As per IRICA's data, exports to Azerbaijan saw a 42% growth while exports to Turkmenistan dropped by 9%.

Iran’s non-oil exports to Russia increased by 20% to reach $118 million.

Kazakhstan saw a 3.3% increase in imports from Iran.

Iran and Kazakhstan recently signed an agreement to ease the issuance of permits for truckers commuting between the two countries to boost cooperation in the road transportation sector.

Bilateral trade volume exceeds $400 million per year and the two countries aim to increase the figure to $2 billion.

New Export Terminals

This year Iran launched new export terminals, namely a rail station in the northern port of Astara, one in the Caspian port in Anzali Free Trade Zone and the Payam International Airport located in Karaj 50 km west of Tehran.

More than $135 million worth of non-oil goods were exported through Astara in H1, mainly to Azerbaijan Republic and Russia.

Payam Airport was the departure point for $38 million worth of Iranian goods to almost all the neighboring states.

Asalouyeh in Bushehr, used for transporting petrochemical goods; Shahid Rajaee Port and Imam Khomeini Port in Khuzestan were the main border checkpoints used for exporting commodities to neighboring countries.

Iran's overall non-oil exports hit 56.64 million tons worth $23.12 billion in H1, indicating a 3% decrease in weight and a 13% increase in value year-on-year.

By “non-oil”, IRICA refers to all commodities, except crude oil. So oil-driven products and by-products as well as petrochemical products are still categorized as non-oil.

China, Iraq, the UAE, Afghanistan and India were the main customers of Iranian products during the six-month period in a descending order.