Page 56 - IRANRptNov21

Rocketing tomato paste price bellwether for painful Iranian food inflation
Iran’s feed industry ‘driven into crisis that threatens country with food shortages’
The figures do not include pork and boar, which only non-Muslims in Iran are permitted to eat.
The per capita consumption of red meat in Iran is 12.5 kilograms. Other consumption rates are chicken meat at 31.25kg, raw milk at 124kg, eggs at 11.72kg and honey at 1.35kg.
Iran continues to struggle with painfully high food inflation. The prices of two staples of Iranian households, tomato paste and rice, have lately climbed at a worrying pace.
The price of an 800-gram can of tomato paste—a product seen as a bellwether for overall food prices by many Iranians—has reached Iranian toman (IRT) 30,000 ($1.10), up 50% m/m, Tasnim News reported on September 6.
Iran’s official consumer price index annual inflation was reported on August 24 as 45.2%. Food inflation was at 58%, according to the Statistical Centre of Iran (SCI).
A kilogram of Iranian rice in the country currently exchanges hands at the wholesale price of IRT45,000 to 47,000 per kg, with imported rice sold at IRT25,000. Drought has hit domestic rice harvesting, down 18% y/y in the current Persian calendar year (started March 21). Strategic reserves and the market regulation of rice distribution help to curb the effects of lower production, but Iran also lately moved to repeal its ban on imports of rice from India, Pakistan and Thailand.
The officially listed price of eggs has also sharply increased m/m. The cost of a large carton of eggs has recently risen from IRT215,000 to IRT250,000.
Western sanctions, currency depreciation and drought have driven the Iranian feed industry to an unprecedented crisis, threatening the country with food shortages in the next few months, writes All About Feed.
The trade publication points out that the Iranian government keeps adhering to its price-constraining policy on the domestic livestock market, with the policy including purchasing chicken from all farmers at fixed prices and distributing feedstuff among farmers and feed mills at guaranteed prices. The second part of this policy is said to have not functioned well recently.
Mojtaba Aali, CEO of the National Union of Livestock Breeders, is cited as saying: “The feedstuff either does not reach farmers or reach farmers too late, forcing them to source feedstuff on the open market. When farmers begin buying grain on the open market, their costs skyrocket.” Numerous farmers have reportedly declared bankruptcy, with many others culling their animals, not willing to suffer losses, according to local reports.
“This [policy] has led to the mass culling of livestock and rising meat supply in the market, but if this trend continues, we expect to see a severe shortage of livestock in the country in the next three to six months, and the market will undoubtedly become inflamed,” Aali was further reported as saying.
The Iranian Ministry of Agricultural Jihad is also under fire from farmers for rushing to protect consumers in a way that causes a lot of harm to agricultural businesses.
“If the government wants to continue to buy chicken at the same price, it must deliver feedstuff on time and cheaper to poultry farmers so that we do not see the bankruptcy of producers,” said Habib Asada Nejad, a local farmer, according to All About Feed.
With the Iranian government intent on saving FX, there are thought to be 3mn tonnes of grain stuck at customs clearance at seaports awaiting the payment of bills.
The US dollar was by the end of August 26 trading at 275,000 rials on Tehran’s open market, hitting 2021 highs. Farmers will be anxious that the latest
56 IRAN Country Report November 2021 www.intellinews.com