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29 November 2023

Co-op movement drives Iran's agri growth

Iran needs about 10 million tonnes of wheat per year and produces only four million tonnes per year. (AFP)

By VM Sathish

Iran's agricultural sector has witnessed tremendous growth over the past three decades, but the country's dependence on food imports have increased because of poor harvest due to bad weather conditions, said M Mirzei, Deputy Managing Director, the Central Union of Rural and Agricultural Cooperatives of Iran.

The cooperative movement in Iran is helping 25 million people – five million Iranian farmers and their family members who are keen to expand their exports to the region.

Mirzei said the cooperative movement has been helping farmers to improve the country's farm sector and food security.

"We have been encouraging barter deals with the farmers. In exchange for the farm products like fruits, vegetables or rice, we sell them fertilisers, pesticides, farm implements. The government supports farmers through fertiliser subsidy and it is distributed through the cooperative network."

The Cooperative Union has 31 main branches in the main Iranian provinces and 300 branches around the country. The head office is in Tehran.

Talking to Emirates Business during a visit to Dubai seeking new markets for Iranian agricultural exports, Mirzei said Iranian farmers faced a tough time last year because of bad weather conditions.

Iranian fruits, vegetables, dry fruits and saffron are regularly exported to the UAE and other GCC countries.

"Agricultural production in 2007 fell by 30 per cent causing a sharp increase in the price of food, especially wheat, rice and barley for which Iran is still dependent on imports. Rice production is only 2.5 million tonnes per year and we import rice from India and other Asian countries. Wheat barley, corn, fruits, grapes, apples and dates are produced by member cooperatives. Iran needs about 10 million tonnes of wheat per year and produces only four million tonnes per year."

Wheat is a main staple food in Iran needed for bread and other food items. "Four years ago, Iran did not need food imports now we want four million tonnes and import about 800,000 tonnes. In the case of rice, we produce 20 per cent of the requirement and 80 per cent is imported."

According to Food and Agricultural Organisation (FAO), Iran's total demand for cereals in 2006 was 26.2 million tonnes and the country produced only 21.7 million tonnes.

The demand went up to 26.8 million tonnes in 2007 but production fell by 30 per cent. Rice export ban by India and other countries and depreciation of Iran currency affected rice price in Iran.

Mirzei said Iran has a virtual monopoly in saffron and the country is trying to increase saffron exports to the world through Dubai. "Iran produces about 200 tonnes of saffron worth around $100 million per year – more than 90 per cent of saffron produced in the world – and exported to many countries including the US and Europe."

While Arabs use saffron for preparing saffron tea and Arabic coffee, Indians use it for the preparation of Biryani.

The country is keen to increase saffron production and export and the cooperative union is encouraging more saffron cultivation. Saffron cultivation in Iran received a major set back this year because total production came down by 30 per cent to 140 million tonnes. Some European companies are allegedly saffron exported from Iran and selling with their brand names.

Mirzei said it is used widely in Europe – Italians and the Swiss use saffron for the preparation of a dish with rice called Risotto and Spaniards use saffron for the preparation of a dish called Paella.

Germans and the English use saffron for the preparation of saffron cake.

According to the FAO, Iran controls 80 per cent of the world market for saffron followed by Greece and India (five per cent each) and others (10 per cent).

Two years ago, fertiliser prices went up sharply, about three times because of global market situation. Now the prices are back to normal and Iran has started producing more fertilisers.

It has been difficult for farmers. Government support farmers in some crops mainly wheat, barley, corn and oil seeds.

"The farm sector has seven big cooperatives and ours is the biggest agricultural cooperative in Iran. Government support to farmers is through the cooperatives. We expect farm production will be better in 2009," Mirzei said.