Could Iran nuclear deal bring greater stability to the Middle Eastern fruit market?
Whether it be for Philippine bananas or Pakistani mangoes, South African citrus or Chilean apples, greater challenges have been placed on international fruit exporters trying to reach the Iranian market in recent years. For some it has been a matter of outright prohibition, while for others the issue of sanctions on Iranian financial institutions has made trade unviable. So does the recent nuclear deal with the West spell an end to these problems? The jury is still out for the produce trade, but the potential opening up of a market of 77 million people is certainly a step in the right direction for many.
"We have been watching and waiting for a long time, and hoping this day would come," says G.F. Marketing director David Pearce, a shipper of South African and Chilean fruits who focuses on the Middle Eastern market.
"We are excited at the prospect of good opportunities now that Iran is opening up," he says.
Pearce highlights that Iranians eat the most fruit out of all the Middle Eastern countries' populations, and to the benefit of suppliers the country is more willing to take larger sized fruit as well.
At least, that was the case for exporters when the market was open. The nuclear deal reached last week between Iran and the P5+1 countries still has to run through the internal political processes of the nations involved, and then Iran would need to change its food import policies, but Pearce is pleased the ball is now rolling.
"The Middle East needs Iran to be open and to be part of the marketplace, and this will have a good effect. Will it affect pricing? Who knows, but it will bring stability to the market, that is for sure," Pearce says.
He emphasizes Iran is also a gateway to countries like Azerbaijan, Georgia, Kazakhstan, Uzbekistan and Afghanistan.
"The sanctions meant that the shipping lines increased their freight rates to Iran to almost double the normal rate, and that increased rate affected the business which used to go via Iran to the end user, for example Azerbaijan," he says.
He says G.F. Marketing used to ship apples, pears, oranges, lemons, mandarins, grapes, plums and cherries to the Persian country, representing under 10% of its total volume.
"Oranges and apples were the most popular, due mainly to the good arrival condition of the fruits versus the poorer arrival of the softer fruits," he says.
According to statistics published by the Food and Agriculture Organization (FAO), in 2012 Iran imported US$410 million worth of bananas, US$151 million in citrus fruit and US$36 million in pome fruit. Around one third of its horticultural imports came via the United Arab Emirates, most likely as re-exports.
Iran is also the world's leading grower of pistachios and saffron, with high rankings as well for the production of dates, apricots, watermelons and walnuts (2nd); cherries, melons and raisins (3rd); figs (5th); plums and tomatoes (6th); mandarins and hazelnuts (7th); and lemons and apples (9th).