We have been following Iran’s increasingly severe water shortage over the past year. This problem hurts agricultural yields in Iran and also contributes to cross-border tensions with Iraq. Today’s FT has an article chronicling how water shortages have hurt the Iranian pistachio crop, both in terms of absolute output and output per hectare compared with its closest rival in the market, the United States. The most shocking statistic comes towards the end, that Iranian farmers pick about 800kg of nuts per hectare against 3,200kg in the US.
Pistachios are Iran’s biggest non-oil export and the source of politician Ali Akbar Hashemi Rafsanjani’s family fortune, so these changes could have serious political repercussions.
The clip from Al-Jazeera English above gives a bit more background on Iran’s pistachio industry and its rivalry with the U.S. and a snip from the FT article follows:
-WW
Pistachios are one of the Islamic republic’s leading commodities, constituting 11 per cent of non-oil exports – more than Iran’s famous hand-woven carpets, saffron and dates.
They generated $1.2bn in export earnings in 2007 and $800m in 2008, according to the Pistachio Association. It is predicting a figure of $1.2bn for 2009.
The relatively poor showing of the nuts is a symptom of the wider problems afflicting Iran’s agricultural sector, which accounts for about 17 per cent of gross domestic product. Farming suffers from a shortage of investment by the government and the private sector.
Limited funding by banks, under-mechanised systems and the high costs of water make Iranian produce uncompetitive.
Most of the pistachio industry is private and controlled by small-scale farmers. The government does not set prices but it sometimes steps in to buy crops to support farmers.
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