Grain Exporters Await Lifting of Sanctions on Iran

As the implementation of the nuclear agreement and the lifting of sanctions approaches, grain exporting companies are eyeing the opening of the Iranian market for trade. The American publication Farm Journal reports that although food exports, particularly wheat, continued to Iran even during tough sanctions, new traders are ready to enter this market with the opening of the Iranian market and the establishment of banking facilities. In the Middle East, Iran and Turkey are two major consumers of grains, especially wheat. Various types of bread in Iran, such as Lavash, Sangak, Barbari, and Taftoon, are considered staple foods and have high consumption rates. Even international grain sellers are familiar with these names and Iranian breads. Due to geographical deficiencies and low production, Iran has always needed wheat imports, and grain sellers consistently list Iran at the top of their buyer lists. The American publication Farm Journal, which specializes in agricultural developments and the production and trade of food products, states that this week, major grain traders at their global conference focused on new opportunities arising from the lifting of sanctions in Iran. The publication adds that foodstuffs have never been on the West's list of sanctioned goods, but the regulations governing the enforcement of sanctions have created difficulties in trading these goods, and now, with the lifting of sanctions, major grain exporting companies are entering the high-consumption Iranian market. Farm Journal cites examples of companies that have continued to export grains to Iran despite difficulties, mentioning the German company 'BWA AG,' which recently exported grains from Russia and soybeans from South America to Iran. Meanwhile, major exporters like 'Bunge Limited' and 'Cargill Inc.' have continued their activities in the Iranian market and are now awaiting the expansion of these activities. Kamran Dadkhah, a university professor and economist residing in Massachusetts, USA, comments on Iran's capabilities for grain production, especially wheat: 'Iran cannot be considered an agricultural country, both in terms of land status and water availability; however, there are some agricultural products that Iran can produce better than anywhere else in the world, such as Iranian pistachios, which are the best in the world; there is also significant potential for exploitation in northern Iran, but overall, the capacity for food production in Iran is limited, especially since water resources are not easily accessible everywhere in Iran.' Mr. Dadkhah adds, 'If we consider this in terms of wheat, the estimate they have made, which I believe is very optimistic, is that Iran will consume 18 million tons [of wheat], and of this amount, three million tons will be imported; my guess is that the import amount should be more than this [amount], just as during Mr. Ahmadinejad's time, a very large amount of wheat was imported.' Farm Journal states that the amount of wheat imports by Iran varies each year but has a growing trend. According to estimates from the U.S. Department of Agriculture, Iran will import four million tons of wheat this season, and this amount may increase to six to seven million tons. In the past three years, following an unprecedented production surplus over the last 29 years, wheat prices have decreased. For instance, in the Chicago Board of Trade, which is the center for international grain trading and where the announced prices are considered global benchmarks, the price of wheat has decreased by 13% this year. In Paris, the price of wheat flour for baking bread has also decreased by nearly 9%, selling at 184 euros per ton, or approximately 198 U.S. dollars. Kamran Dadkhah, the economist residing in the U.S., comments on the necessary measures to improve agricultural production in Iran, stating that government officials have acted contrary to the measures needed, and the policies they have adopted will be detrimental to food production. Mr. Dadkhah says, 'There are some technologies, such as drip irrigation, that could be very beneficial for Iran, but instead of these measures, they have brought up some irrelevant and truly treasonous ideas, such as self-sufficiency in [wheat] production. Instead of producing those materials that can be produced and possibly exporting them while importing wheat, they repeated that they want to be self-sufficient. Why do you want to be self-sufficient? This is a world that is interdependent; therefore, with the measures they have taken and the dams they have built indiscriminately, they have caused significant damage to the potential for food and wheat production in Iran, which will not be easy to rectify.' The American publication Farm Journal, published in Philadelphia, reports that last week, the German company 'BWA' sent one of its executives to Iran. This company, based in Munich, plans to export 250,000 tons of grains and oilseeds to Iran. Managers from 'Nidra,' a subsidiary of 'COFCO,' the largest food company in China, have also traveled to Tehran this week to meet with their customers. This company exports about three million tons of wheat and vegetable oils to Iran each year. Iran's largest grain imports come from the European Union, Russia, Australia, and Kazakhstan. Farm Journal concludes by quoting a senior manager from 'BWA,' stating that Iran is one of the most important major importers of grains and oilseeds in the world and plays a very significant role in agricultural product trade.