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Agriculture in Iran

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Roughly one-third of Iran's total surface area is suited for farmland, but because of poor soil and lack of adequate water distribution in many areas, most of it is not under cultivation. Only 12% of the total land area is under cultivation (arable land, orchards and vineyards) but less than one-third of the cultivated area is irrigated; the rest is devoted to dry farming. Some 92 percent of agro products depend on water.[1] The western and northwestern portions of the country have the most fertile soils. Iran's food security index stands at around 96 percent.[2]

3% of the total land area is used for grazing and small fodder production. Most of the grazing is done on mostly semi-dry rangeland in mountain areas and on areas surrounding the large deserts ("Dasht's") of Central Iran.

The non-agricultural surface represents 53% of the total area of Iran, as follows:

  • Abb. 39% of the country is covered by deserts, salt flats ("kavirs") and bare-rock mountains, not suited for agricultural purposes.
  • An additional 7% of Iran's total surface is covered by woodlands.
  • And 7% is covered by cities, towns, villages, industrial areas and roads.

At the end of the 20th century, agricultural activities accounted for about one-fifth of Iran's gross domestic product (GDP) and employed a comparable proportion of the workforce. Most farms are small, less than 25 acres (10 hectares), and are not economically viable, which has contributed to the wide-scale migration to cities. In addition to water scarcity and areas of poor soil, seed is of low quality and farming techniques are antiquated.

All these factors have contributed to low crop yields and poverty in rural areas. Further, after the 1979 revolution many agricultural workers claimed ownership rights and forcibly occupied large, privately owned farms where they had been employed. The legal disputes that arose from this situation remained unresolved through the 1980s, and many owners put off making large capital investments that would have improved farm productivity, further deteriorating production. Progressive government efforts and incentives during the 1990s, however, improved agricultural productivity marginally, helping Iran toward its goal of reestablishing national self-sufficiency in food production.

Land use and irrigation

See also: Irrigation in Iran and Water supply and sanitation in Iran
Land use in Iran

Average annual rainfall is 800 mm but in Iran the annual rainfall is only 220 mm.[3] Overall, Iran's soil is not well suited for large scale agriculture. About 12 percent of the country's total land area of 1,636,000 km² is cultivated. Still, 63% of the cultivable lands have not been used, and 185,000 km² of the present farms are being used with 50 to 60% capacity.[4]

Both irrigated and rain-fed farming are used in Iran. In 2005, some 13.05 million hectares of land was under cultivation, of which 50.45% was allocated to irrigated farming and the remaining 49.55% to rain-fed system.[5] As of 2013, The amount of cultivated land that is irrigated increased to 8 million hectares, while 10 million hectares remain rain-fed.[6]

Rainfall & Agricultural Production[7]
March 2001 March 2003 March 2005 March 2007 March 2008 March 2009 March 2010 March 2011
Production (Million Ton) 65 80 87 97 92 70 91 99
Rainfall (Millimeter) 52 70 69 62 75 51 61 69

Crops and plants

See also: Geography of Iran
Map of Iran's major crops, circa 1978.
Rice cultivation in Gilan

The wide range of temperature fluctuation in different parts of the country and the multiplicity of climatic zones make it possible to cultivate a diverse variety of crops, including cereals (wheat, barley, rice, and maize (corn)), fruits (dates, figs, pomegranates, melons, and grapes), vegetables, cotton, sugar beets, sugarcane and pistachios (World's largest producer with 40% of the world's output in 2005[8]), nuts, olives, spices e.g. saffron (World's largest producer with 81% of the world's total output),[9] raisin(world's third largest producer & second largest exporter[10]), tea, tobacco, Berberis(world's largest producer[11]) and medicinal herbs.[12] More than 2,000 plant species are grown in Iran; only 100 of which are being used in pharmaceutical industries. The land covered by Iran's natural flora is four times that of Europe.[13]

Wheat, rice, and barley are the country's major crops. The Iranian grain sector is highly regulated. Producers receive subsidised access to input costs such as fertiliser and pesticides, as well as a guaranteed support price for their crops.[14]

Wheat: In 2007 Iran exported close to 600,000 tones of wheat (out of a production of 15 million tonnes).[15] Approximately 6 million tons of wheat will be purchased from 15 countries in 2009 because of the drought in 2008, thus making Iran the largest wheat importer in the world.[16][17] Wheat production reached 14 million tons in 2010.[18] According to the FAO, Iran is the 12th leading producer of wheat in the world, with an average production of 14 million tons in 2011.[19]

Rice: Iran's total rice production stands at 2.2 million tons per annum whereas annual consumption is about three million tons (2008).[4] Iran has imported about 630,000 tons of rice from UAE, Pakistan and Uruguay worth $271 million in 2008 and 1.4 million tons of rice, worth $800 million in 2009.[20][21] Iran's rice imports drop by 40% in 2010.[22] Iran’s rice production in 2011 was 2.4 million tons, which increased from a total of 2.3 million tons in the previous year.[19] Iran has 3,800 rice milling units (2009).[1] The average per capita consumption of rice in Iran is 45.5 kg, which makes Iranians the 13th biggest rice consumers.[23] Rice is mostly produced in northern Iran. Rice has being cultivated for many years in Gilan Province of Iran. In Gilan Province, many indica rice cultivars including Gerdeh, Hashemi, Hasani, and Gharib have been bred by farmers.[24]

Sugar: In 2008, Iran had a shortage of 400,000 tons to 600,000 tons of sugar nationwide.[25] Sugar companies suffered from massive imports of cheap sugar over the past few years, which led to a 50% drop in the capacity of the sugar industry’s production in 2008. The lack of import tariffs was the main reason for the domestic sugar industry suffering in this manner.[26]

Pistachio: Iran ranks the world's largest pistachio producer and exporter followed by USA and Turkey. After oil and carpets, pistachios are Iran's biggest exports: about 200,000 tons for $840 million in 2008.[27] More than 350,000 people earn a living from the nut, most of them in vast groves of the desert oases in southeast.[8][28] Iran's share in the global pistachio market reached 50 percent in 2010.[29]

Saffron: Saffron is cultivated in many regions of the country, the provinces of North Khorasan, Khorasan Razavi and South Khorasan in the northeast have the highest production share. Iran's saffron is exported to the United Arab Emirates, Spain, Japan, Turkmenistan, France, Italy and US.[30] The northeastern Khorasan Razavi province exported 57 tons of saffron worth $156.5 million to 41 countries in 2010.[31] The high production cost comes from the exhaustive process of extracting the stamens from the flower and the amount of flowers necessary to produce small amounts of spice but the process is in the process of being automated now. Iran is the largest producer of Saffron with 93.7% of the world's total production.

Tea: Tea production rose to 190,000 tons in 2007 from 130,000 tons in 2004. 75,000 tons of tea is smuggled into Iran each year (2008).[32]

Horticulture: Close to 19 million tons of horticultural crops will be produced by the end of Fourth Plan (2005–10).[33]

Fruits: Iran exported more than 35,000 tons of citrus fruits valued at $20.8 million to 36 countries in 2008.[34] Iran is anmong the largest producers of berries and stone fruits in the world, especially pomegranates, dates, figs and cherries.[11] See also: Fruit in Iran.

Livestock

See also: Wildlife in Iran
Iranian shepherds moving their sheep. North-western Iran, winter 2008.

Of the country's livestock, sheep are by far the most numerous, followed by goats, cattle, donkeys, horses, water buffalo, and mules. The raising of poultry for eggs and meat is prevalent. One area where production infrastructure has progressed rapidly is the poultry sector. The face of the industry has now been transformed dramatically so that the entire supply chain process can take place domestically.[14]

Iran has also a large dairy industry and imported close to two million tonnes of feed grain annually in 2006. The raising of pigs is forbidden in Iran due to Islamic law.[35]

Production of livestock increased over the past three years to reach 11.3 million tons in 2008 from the 10.6 million tons in 2007, and 9.9 million tons in 2006.[36] Meat processing capacity is at 400,000 tons and 140 production units (2009).[1] In 2008, per capita meat consumption was 26 kg.[37] Iran produced 950,000 tons of red meat and 1,600,000 tons of chicken in 2010.[18]

Fishing

Access to the Caspian Sea, the Persian Gulf, the Gulf of Oman, and many river basins provides Iran the potential to develop excellent fisheries. The government assumed control of commercial fishing in 1952. One government-owned enterprise, the Northern Sheelat Company, was established in 1952, and a second, the Southern Sheelat Company, was established in 1961. In recent years, illegal and off-season fishing, discharge of industrial and agricultural pollutants, overfishing by other Caspian littoral states, and other unfavorable conditions have endangered Caspian fish resources. Between 1990 and 2004, Iran’s total annual Caspian Sea catch declined from 98,000 tons to 32,533 tons, including 463 tons of sturgeon, which yields high-quality caviar.[38]

Iran has 1,786 kilometers of coastline on the Persian Gulf and the Gulf of Oman. These southern waters are rich in fish and other marine resources. In 2004 the catch off the southern coast totaled 299,000 tons. This represented an average annual increase of 12.6 percent since 1976. The southern catch either is used directly by households and restaurants or processed and preserved by industry. Expansion of the fishery infrastructure would enable the country to harvest an estimated 700,000 tons of fish annually from the southern waters. However, increased pollution from the oil industry and other enterprises poses a serious threat to this area’s fishing industry.[38]

Since the Revolution, increased attention has been focused on producing fish from inland waters. Between 1976 and 2004, the combined take from inland waters by the state and private sectors increased from 1,100 tons to 110,175 tons.[38]

Important fish include sturgeon (yielding its roe for caviar), bream, whitefish, salmon, mullet, carp, catfish, perch, and roach.[citation needed] More than 200 species of fish are found in the Persian Gulf, 150 of which are edible, including shrimps and prawns.[citation needed]

Some 692,000 tons of aquatics will be produced across the country by the end of the 2008, of which 236,000 tons would be bred and the rest fished from the sea. Per capita consumption of seafood in Iran will reach 8.5 kg by March 2009 and 10 kg a year later.[39]

Caviar: Iranian caviar export is expected to reach $22 million by March 2009.[40] Iran is the world's largest producer and exporter of caviar in the world, exporting more than 300 tonnes annually.[41][42]

Forestry

See also: Environmental issues in Iran, Geography of Iran, and List of trees of Iran

In 2005 Iran’s forest area totaled about 11 million hectares, approximately 7 percent of the country’s surface area.[38] Adequate rainfall and a favorable climate have created 1.5 million hectares of dense forest in the Caspian region. The remainder is distributed among western forests (3.6 million hectares), southern forests (434,000 hectares), desert forests (620,000 hectares), and forests scattered in other locations.[38] Supervised by the Department of Natural Resources, the Caspian forests produced 820,000 cubic meters of timber products in 2004, more than 90 percent of which was for industrial use.[38] The largest and most valuable woodland areas are in the Caspian region and the northern slopes of the Elburz Mts., where many of the forests are commercially exploitable and include both hardwoods and softwoods.[citation needed] Although forests and pastures are nationalized and 12 percent of forested land is nominally protected, forest destruction by the private sector is routine.[38] Limited forest areas, mismanagement, and destruction have compelled Iran to import lumber and wood products. In addition, forest fires destroy 20,000 hectares of forest area each year.[38] Between 1954 and 2004, an estimated 41 percent of Iran’s forest land was lost.[38] According to the former director of Iran’s Department of Environment (Iran), the rate of destruction of forestland amounts to 100,000 hectares per year.[43] The cutting of trees is rigidly controlled by the government, which also has a reforestation program.

History

See also: History of Iran
Colorized picture of farmers winnowing grain in Southern Iran, 1921.

Agriculture has a long history and tradition in Iran. As early as 10,000 BCE, the earliest known domestication of the goat had taken place in the Iranian plateau.[44] By 5000BCE, wine was being fermented in Iran,[45] and by as early as 7th century CE, the windmill had been invented in Persia for the first time in history.[46][47]

Fruits such as the peach first found their way into Europe from Persia, as indicated by their Latin name, persica, from which (by way of the French) we have the English word "peach." [48] As did Tulips, which were also first cultivated in ancient Persia [49][50] and spinach, the word Spinach itself derived from the Persian word اسفناج Esfenaj. The Chinese referred to it in 647CE as 'the herb of Persia'. In 400BCE, a form of ice cream was in use in Persia,[51][52] and the ancestor of the cookie is said to have come from Persia (from the Persian koolucheh) in the 7th century according to many sources.[53][54]

Fifth century BCE Persia was even the source for introduction of the domesticated chicken into Europe. The mid fifth century BCE poet Cratinus (according to the later Greek author "Athenaeus") for example calls the chicken "the Persian alarm". In Aristophanes's comedy The Birds (414 BC) a chicken is called "the Median bird", which points to its introduction from Persis.

The Qanat, a subterranean aqueduct used for irrigation in agriculture, was one of the most significant and successful achievements of the Persian tradition. Qanats were in use millennia ago, and are still in use in contemporary Iran.

A boom in the production and export of cotton made Iran the richest region of the Islamic caliphate in the ninth and tenth centuries. Yet in the eleventh century, because of colder temperatures, Iran's impressive agricultural economy entered a steep decline, bringing the country's primacy to an end.[55]

Modern era

See also: Economic history of Iran

Modern agriculture in Iran dates back to the 1820s, when Amir Kabir, the Chief Minister to Naser al-Din Shah and a symbol of reform and modernism in Iran, undertook a number of changes to the traditional agricultural system. Such changes included importing modified seeds and signing collaboration contracts with other countries. The first agricultural school was founded about a hundred years ago and the Agriculture Bank was established in 1933. The Ministry of Agriculture is currently overseeing and implementing the government’s policies in the agricultural sector.

Of the 162.2 million hectares of land in Iran, approximately 19 million hectares is agricultural land. This constitutes 12% of the country’s land area. The agricultural sector in Iran currently constitutes 13.9% of GDP and agricultural products form about 30% of Iran’s non-oil exports. According to the Food and Agriculture Organisation (FAO), Iran ranks amongst the top 7 countries in producing 22 important agricultural products: it ranks first in pistachio production, second in date production and fourth in apple production worldwide. It is also the twelfth largest producer of wheat and had the second highest production increase after Argentina in 2010. The value of agricultural production increased by 20% in the Iranian calendar year 1389 (ending March 2011) and agricultural exports rose by 30% in comparison to the previous year.

The agricultural sector faces a number of challenges in Iran, the two most important being low rainfall and the impact of fluctuations in oil revenues. Unsurprisingly, agricultural production is directly correlated to the amount of rainfall. The relatively dry climate of most of Iran’s regions makes water availability a vital factor in production. For instance, a drought in 2007 damaged agricultural output and drove it down to 9.3% of GDP.

Another influential factor is oil revenues. Historically, in periods of high oil prices and the consequent petrodollar windfall, imports accelerate rapidly in virtually all consumption categories including agricultural products. This, in turn, results in crowding out domestic production and damage to the agriculture sector. After the oil price spikes following 1973, agricultural imports also increased dramatically and caused significant damage to domestic production. Between 1970 and 1976, agricultural imports grew at the staggering annual rate of 35%. This experience was repeated in the past couple of years when oil prices were at or over $100 per barrel; the result is that agricultural imports have increased at a rapid pace and foreign products now form a sizeable chunk of the household consumption basket. Over the past few years, there have been significant price increases in agricultural products in Iran. This is due both to rising domestic demand and to rising global commodity prices.

The Iranian government supports the agricultural sector in a number of ways. Like many other countries, the agricultural sector is heavily subsidised by the Iranian government. Each year, the government guarantees the purchase of wheat from the farmers at a pre-specialized price to protect them from seasonality in the market prices. The government also pays a wide range of subsidies for improvements in production methods, the use of fertilisers and pesticides, and agricultural research. Nonetheless, there still exist considerable opportunities to improve efficiency in the agricultural sector. For instance, only 10% of farms are equipped with modern irrigation facilities and the rest are still farmed using legacy methods.

The market mechanism for agricultural products is not particularly developed given the traditional nature of the agricultural sector and the numerous governmental interventions in the market prices. The market mainly consists of a large number of retail traders who purchase the crops from the farmers in small quantities and bring them to the major traders in the bazaar, which is the system that was the predecessor to the modern markets. In order to improve market efficiency and transparency, the Iranian government has allowed trading of agricultural products on the Iran Mercantile Exchange (IME) for the past seven years. More than 22 different agricultural products are currently traded on the IME and the trading volume for them is approximately 200,000 tonnes per annum. Nonetheless, given the direct impact of the prices of agricultural products on people’s daily lives and welfare, the government actively intervenes in the market by setting prices, importing products in large amounts, subsidising certain products, and restricting exports in order to supply domestic demand.

With the subsidies reform plan implemented, many experts are hopeful that not only will government intervention and price distortions in agricultural products be reduced, but also that a fundamental restructuring will take place in the agriculture sector. The government has recently quadrupled bread prices as part of the plan and is planning to liberalise the market completely. In addition, the pricing of a number of other products that was previously done by the government is now to be left to the market mechanism. More importantly, fuel, water and electricity prices have increased significantly. The government has still kept prices lowest for agriculture in comparison to household and industrial consumers. Nonetheless, the high level of inefficiency in the agricultural sector from irrigation to harvesting, is expected to be fundamentally reformed and replaced with more efficient and modern technologies.

With an amazingly diverse climate, very high local and regional demand and an educated workforce of more than 100,000 in this field, Iran’s agricultural sector is clearly underdeveloped and has immense potential for investment and growth. According to a former agriculture minister, deserts in Iran are spreading, South Alborz and East Zagros will be uninhabitable and people will have to migrate. Out of 75 million people in Iran, 45 million will have uncertain circumstances.[56][better source needed]

Agribusiness

See also: Economy of Iran, Demography of Iran, and Iranian labor law
A Lahijan tea farm during harvest time, northern Iran.

After nearly achieving agricultural self-sufficiency in the 1960s, Iran reached the point in 1979 where 65 percent of its food had to be imported. Declining productivity was blamed on the use of modern fertilizers, which had inadvertently scorched the thin Iranian soil. Unresolved land reform issues, a lack of economic incentives to raise surplus crops, and low profit ratios combined to drive increasingly large segments of the farm population into urban areas.

Since 1979 commercial farming has replaced subsistence farming as the dominant mode of agricultural production. Some northern and western areas support rain-fed agriculture, while other areas require irrigation for successful crop production. The 1979 Revolution sought self-sufficiency in foodstuffs as part of its overall goal of decreased economic dependence on the West. Higher government subsidies for grain and other staples and expanded short-term credit and tax exemptions for farmers complying with government quotas were intended by the new regime to promote self-sufficiency. But by early 1987, Iran was actually more dependent on agricultural imports than in the 1970s.

By 1997, the gross value of products in Iran's agricultural sector had reached $25 billion. In 2000, the Construction Jihad Organization and the Ministry of Agriculture were merged by national legislation, to form the new Ministry of Agricultural Jihad.

The 1999-2000 drought reduced overall GDP by about 4.4%, and resulted in decreased non-oil exports, increased food imports, and a rise in inflation. [57] In 2003, a quarter of Iran's non-oil exports were agricultural based. In 2004 an agricultural bourse started trading agricultural and related products in the country.[58] Iran's agricultural sector contributed 11 percent of the GDP in 2004 and employed a third of the labor force.

Benefiting from 123,580 square kilometers of land suitable for agriculture, the agricultural sector is one of the major contributors to Iran's economy. It accounts for almost 13% of Iran's GDP, 20% of the employed population, 23% of non-oil exports, 82% of domestically consumed foodstuffs and 90% of raw materials used in the food processing industry (2008).[5]

Focus areas

See also: Keshavarzi Bank and Foreign Direct Investment in Iran
Iranian fishermen by the Caspian Sea

The focus areas for agriculture are:

  • Financing and low-interest loans for investment in agriculture and agro-industrial projects.
  • Ensuring self-sufficiency in the provision of national food requirements.
  • Budgets for agro-industrial projects in the food processing, packaging and irrigation sectors.
  • Provision of agricultural machinery and equipment with emphasis on local production by making transfer of technology a required clause in foreign contracts. Foreign loans and investments in the agro sector exceeded $500 million in 2008.[27]
  • Allocation of government loans and financing for agro-industrial projects.

Agro complexes

See also: Bonyad and Retail industry in Iran

In 2009 seven hundred agricultural complexes were under construction on 60,000 hectares of farmlands across the country. Chicken farms, animal husbandries, fish farming pools and greenhouses are built in these complexes.[59]

Mechanized agriculture

See also: Industrial Development and Renovation Organization of Iran

Mechanized agricultural has had a slow but steady growth in Iran. Industrial facilities in Tabriz and Arak are Iran's largest producers of machinery and equipment for the agricultural sector. 12,000 combine harvesters and 300,000 tractors are currently used in the sector (2007).[60] Tabriz Tractor Manufacturing Company, which was founded four decades ago, employs almost 10,000 people. It produces 30,000 tractors annually, a large part of which is exported.[61] Iran declared self-sufficiency in irrigation and agricultural machinery in 2008.[62]

Production and consumption

See also: Demography of Iran and Iranian Economic Reform Plan

There are 22,000 food industries units in the country (2009). The capacity of these units has increased to 60 million tons from 8 million tons in the pre-Islamic Revolution era.[1] Agricultural production stood at 108 million tons in 2008, which indicates a 20 million ton increase from 2007.[63]

Per capita consumption (Source:EIU)[37] 2009 est. 2010 est.
Meat consumption (kg per head) 27 27
Milk consumption (litres per head) 64 65
Fruit consumption (kg per head) 172 173
Vegetable consumption (kg per head) 184 186
Tea consumption (kg per head) 0.9 0.9

Iranian government policy aims to reach self-sufficiency in food production and by 2007, Iran had attained 96 percent self-sufficiency in essential agricultural products.[1] But wastage in storing, processing, marketing and consumption of food products remained a concern (30% of production according to some sources).[64][65]

The following is the Iranian out-put listed according to the largest global producer rankings in 2007:[11][41][66]

World Ranking Commodity; (Source: FAO)[11]
1st Pistachio, Berberis (Zereshk), Caviar, Saffron, Stone fruits, Berries
2nd Dates, Apricots
3rd Watermelons, Cherries, Cantaloupes & other melons, Apples, Figs, Gherkins
4th Sheep Stocks (Flocks), Fresh Fruits, Quinces, Wool, Almonds, Walnuts
5th Anise, Badian, Fennel, Corian, Chickpeas, Silk worm cocoons
6th Hazelnut, Buffalo milk, Tomatoes
7th Grapes, Onions, Sour cherries, Sheep milk, Kiwifruit
8th Spices, Peach, Nectarines, Tangerine, Mandarin orange, Clementines, Lemons & Limes, Oranges, Goat milk, Pumpkins, Squash & Gourds
9th Lentils
10th Persimmons, Tea, Natural honey
11th Hempseed
12th Citrus fruits, Wheat, Plum and sloes
13th Melon-seeds, Hen eggs, Eggplants (Aubergines)
14th Sugar beet, Fresh vegetables, Barley, Potatoes
15th Safflower seed, Artichoke

The following items are the most important agricultural commodities in Iran, listed by their international value in United States dollar in 2007:[11]

Commodity; (Source: FAO)[11] International Value; x$1000 Quantity; Metric Tonnes
Cow milk 1,715,313 6,500,000
Grapes 1,391,700 2,900,000
Tomatoes 1,184,650 5,000,000
Wheat 1,169,603 15,000,000
Apples 764,005 2,660,000
Pistachios 760,184 230,000
Potatoes 729,601 4,500,000
Hen eggs 543,543 711,000
Rice 471,135 2,800,000
Oranges 404,202 2,300,000
Watermelons 344,091 3,300,000
Fresh Vegetables 328,387 1,750,000
Dates 313,470 1,000,000
Onions, Dry 313,293 1,700,000
Cucumbers and gherkins 290,146 1,720,000
Sugar beet 243,959 5,300,000
Fresh Fruit 223,314 1,400,000
Cantaloupes 218,091 1,230,000
Walnuts 208,506 170,000
Cherries 196,317 225,000

Exports

See also: Iran Mercantile Exchange

Agricultural exports stood at $1.2 billion in 2004-5 and $2.6 billion in 2007-8.[25] Major agricultural exports include fresh and dried fruits, nuts, animal hides, processed foods, caviar and spices. Pistachio, raisins, dates and saffron are the first four export products, from the viewpoint of value.[5] Close to 8 million tons of agricultural products are exported annually (2008).[27] But according to the Central Bank of Iran, only 3.2 million tons of "agricultural products" were exported in 2008 with a total value of $3.2 billion "which showed a 6.1 percent increase over the previous year".[36] Agricultural and food stuff exports in years 2012-13 ending 21 March stood at $5.2 billion.[67]During years 2013-14 ending 21st of March agricultural and food stuff exports increased by 27 percent, standing at $6.6 billion.

Foodstuff

See also: Industry of Iran and List of Iranian companies

A total of 12,198 entities are engaged in the Iranian food industry, or 12% of all entities in the industry sector. The sector also employs approximately 328,000 people or 16.1% of the entire industry sector’s workforce.[6] Iran exported $736 million worth of foodstuffs in 2007 and $1 billion (~600,000 tonnes) in 2010.[68] Soft drinks, mineral water, biscuit, chocolate, confection, edible oil, dairies, conserved foods and fruits, jam and jelly, macaroni, fruit juice and yeast were among the main exports to Iraq, Afghanistan, Turkmenistan, Tajikistan and other Central Asian countries, Russia, Ukraine, Belarus, Pakistan, Saudi Arabia, Kuwait, United Arab Emirates, Qatar, Oman, Syria, Germany, Spain, the Netherlands, France, Canada, Venezuela, Japan, South Korea and Turkey.[68][69]

Government policy

See also: Ministry of Agriculture (Iran) and Government Trading Company

In theory, Iranian agricultural policy is intended to support farmers and encourage the production of strategically important crops. The policy is twofold: first, to purchase certain crops at guaranteed prices and second, to encourage the production of specific crops through farm subsidies. The policy of purchasing agricultural crops from farmers at guaranteed prices was put in place in the 1989 crop year. On average, the guaranteed prices increased at the rate of inflation over the past 15 years. Individual subsidy levels for major crops, however, vary annually.[38]

In the 1990s and early 2000s, government agricultural planning was only marginally successful. According to government figures, during the 1990s—coincident with the first two Islamic Republic economic plans—only 40.5 percent of the agricultural modernization projected by those plans was accomplished, and only 40.2 percent of government and private-sector financial commitments materialized.[38]

Because wheat is considered Iran’s most strategically important crop, it received the largest subsidies, and its production grew at the fastest rate between 1990 and 2005. From FY 2003 to FY 2004, wheat subsidies increased by 17.2 percent, reaching a record of US$1.5 billion. Between 1981 and 2004, the area cultivated with wheat remained stable at 5 million hectares, but wheat production increased from 5.7 million to more than 11 million tons.[38]

Beginning in 1990, the government expanded its agricultural support programs to include a guaranteed purchase price for major agricultural crops, subsidies, favorable interest rates, government investment, and favorable foreign-trade policies. Primarily because of government support for domestic agriculture, between 1989 and 2003 the import volumes of wheat, sugar, and red meat declined by 77.7 percent, 39.6 percent, and 88.2 percent, respectively. Concurrently, the value of agricultural exports increased from US$461.5 million in 1989 to US$1.7 billion in 2004. However, over the same period total food and live animal imports increased from US$1.37 billion to US$2.65 billion.[38]

Imports

See also: Customs in Iran

In the past, the Iranian private sector handled the bulk of the country’s imports of grain and oilseeds, but since 2012 the government has stepped up operations through its Government Trading Corporation (GTC).[70] Other notable agencies are the Livestock Affairs Logistic Co (SLAL) and the Government Grain Trading Agency.

During Mahmoud Ahmadinejad's presidency between 2005 and 2013 imports of agricultural products increased rapidly and reached $13.214 Billion by year 2012-13 ending 21 March whereas agricultural imports in 2004 stood at $3.5 billion.[67]

As of 2015, Iran is among the world’s top four buyers of wheat, barley and rice and one of the 10 largest importers of raw sugar.[71] It has been reported that some imported wheat has been resold into the Iranian government's farmer purchasing scheme at a profit because of lack of import duties for wheat and barley, thus artificially increasing imports at the expense of domestic production.[72]

Industry standards

See also: Halal and Healthcare in Iran

Iran is signatory to bi-lateral protocols that set the standards for many of its agricultural imports including meat and wheat. The protocols are usually negotiated on a country-by-country basis and it's commonplace for Iran to inspect produce prior to shipment.

Iran Customs and the Iran Veterinary Organization are the policing bodies for imported food products, including dairy.

Meat imports require written authorization from the Ministries of Commerce and Agricultural Jihad. The Iranian Government insists on the presence of Shiite clergymen and inspections by the Veterinary Organization during any livestock slaughter.

The Codex Commission of Food Stuff, established in 2002 is in charge of setting and developing standards and quality and health regulations, related to the production of and trade in raw agricultural products and food stuffs, in accordance with the different global standards.

Plant Protection Organization

See also: Iran's Plant Variety Protection Act, 2003

The Plant Protection Organization is in charge of issuing export and import licenses for all kinds of plants and parts thereof including bulbs, cuttings, roots, fruits, saplings, and seeds, as well as the issuance of licenses - which are solely of a technical nature - for importation, exportation, production, transformation and packaging of all kinds of pesticides, herbicides, and plant hormones.[73]

Research and development

See also: Biotechnology in Iran

Attention to the food and nutrition status of Iranian people has been made since Institute of Nutrition and Food Science of Iran (INFSI) was established by Dr. Habibollah Hedayat in 1961.

In 2005, Iran's first genetically modified (GM) rice was approved by national authorities and is being grown commercially for human consumption. In addition to GM rice, Iran has produced several GM plants in the laboratory, such as insect-resistant maize; cotton; potatoes and sugar beets; herbicide-resistant canola; salinity- and drought-tolerant wheat; and blight-resistant maize and wheat.[74] Yet, despite the controversy surrounding GM food and government restrictions on the production of biotech products, Iran imports $5 billion of genetically modified crops a year because of laxed laws (2015).[75]

There are different ongoing research in agricultural fields in Iran which are mostly focused on local problems and requirements. Iran has also a very focused and intensive nanotechnology research program for agricultural applications.[76]

See also

References

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  35. ^ Agriculture Canada: Agri-Food Country Profile Statistical Overview - Iran
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