Page 61 - IRANRptJun22

Iran ‘fears war in Ukraine will halt vital wheat imports’
Price of Iranian rice up 95% in a year says government statistical agency
Iran earns nearly $3.9bn from agri-food exports in first nine months of
The war in Ukraine looks set to bring a halt to shipments of vital wheat supplies needed by Iran within days, according to the chairman of Iran’s National Union for Agricultural Products, ILNA has reported.
Some 25-30% of Iran’s grain imports are provided by Ukraine and Russia, Reza Nourani was quoted as saying. The lack of road and maritime transportation security amid the conflict would likely mean shipments from Ukraine would very soon stop, he was cited as saying.
Ukraine is one of Iran’s target countries for expanding overseas wheat farming but Nourani reportedly said: “We’ll have to wait for the end of war to be able to continue with trade relations.”
Noting that highly fertile land available in Ukraine convinced overseas farmers from various countries, including Iran, to invest in the country, he was also reported as saying: “We hope the war will not lead to the destruction of their investments.”
Iran has been substantially expanding its importation of wheat in the face of difficulties with drought that has undermined its grain output.
Separately, IRNA reported on February 26 that 6.2mn tonnes of wheat were imported by the country during the first 11 months of the current Persian calendar year (March 21, 2021 – February 19, 2022), according to the director general of the sales and distribution coordination department of the Government Trading Corporation.
“This year, the government bought around 4.5 million tonnes of the staple grain from local farmers as part of its guaranteed purchase plan. As domestic consumption of wheat was estimated to rise to over 11 million tonnes this year, the deficit had to be imported,” Hojjat Baratali was quoted as saying by the news agency.
In the previous Persian year (ended March 20, 2021), 10.5 million tonnes of wheat were consumed in Iran, official data showed.
Iran imports essential commodity wheat using its subsidised USD rate of 42,000 rial per dollar. The free market rate is 263,200 per dollar.
The price of Iranian rice has leapt by 95% in the past year, according to a report released by the Statistical Center of Iran (SCI).
The price per kilogram of Iranian rice in the 11th month of the Persian calendar year (ended February 20) also grew by around 20% m/m, the report added. One factor in the steep price hikes is drought, with the government having to step up imports of rice to counter disappointing Iranian rice harvests.
The Iranian rice price has reached Iranian rial (IRR) 760,000 (around $3 at the free market rate), according to the SCI. However, local reports indicate that the actual price encountered by consumers on the market was around IRR1mn. That suggests the price of a kilogram of rice has actually grown by around 200% y/y.
Food prices in Iran have been growing at a much higher rate than official annual general inflation of 42%. Annual rises of around 60% or more are typical, according to government figures.
This will be a big concern for the government as the country prepares to celebrate the Iranian new year on March 20.
Food items subject to hefty inflation include sugar, meat, chicken and eggs, as well as cooking oil.
Iran exported 6.263mn tonnes of agri-food products worth nearly $3.9bn in the first nine months of the current Persian calendar year (March 21-December 21, 2021), Deputy Agriculture Minister Mohammad Ghorbani said in an appearance on state TV.
61 IRAN Country Report June 2022 www.intellinews.com