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Iran: Russia’s new food basket?

Iran-Russian food cooperation begin as a tale of two sets of sanctions: one set removed, one set applied. With Russia engaged in food embargos with numerous states, the drive to find new trading partners is vital. 
Enter Iran. In January 2016, a wide variety of Western-imposed economic sanctions, greatly affecting Iranian trade, were lifted. The Middle Eastern state is now emerging as one of Russia’s leading food suppliers.
Iran certainly is committed to replacing Turkey outright in Russian markets. On April 28 2016, the Russian Federal Customs Service reported that it had received assurance that Iran had the ability to replace Turkish food imports. 
Before Russia-imposed trade sanctions were put in place, Turkey was Russia’s largest trading partner in the Middle East. 
Russian consumers are crying out for a wide range of agriproducts that Iran could supply. According to Fresh Plaza, Iranian pistachio nuts, dried fruits including apricots, dates and grapes are all on Russian menus. Additionally, a number of Russian trade chains have said they’re ready to increase purchases of foodstuffs from Iran.
Russian Energy Minister Alexander Novak, who is Co-Chairman of the Russian-Iranian Inter-Governmental Commission for Trade and Economic Cooperation, said earlier in 2016 that Iran could supply fruits and vegetables worth no less than $1 billion to Russia annually.
This news follows an agreement to expand ties and cooperation in the agro-food industries. After a three day conference in Tehran on April 23 2016 on fostering Iran-Russian commercial relations, the two countries have pledged to strengthen cooperation in the dairy, sweets and chocolate sectors. 
The idea of developing a “green corridor” between the two states has also been floated. "We’ll go there [to Iran] in May to sign a green corridor deal," ITAR-TASS news agency quoted Russia’s Federal Customs Service Chief Andrei Belyaninov as saying. 
Once established, the green corridor would essentially simplify customs procedures and expedite a number of formalities related to customs clearances and document formalisation. Simply put, the green corridor will substantially ease agro-trade between Russia and Iran. 
Russia’s Agriculture Ministry stated in 2015 that Iran supplied 0.7% of total Russian agricultural and food imports.  Data from the Russian Federal Customs Service reveals these imports totalled $194.3 million. Russia mainly imported vegetables, fruits, nuts and dried fruits from Iran during this period.
Conversely, Iran imported agrarian products from Russia worth $484.4 million in 2015. This accounts for approximately 3.1% of Russia’s total agriproduct exports for that year. Grain crops were the basic agricultural commodity Russia supplied to Iran, 91% of which were wheat and barley. 
2016 got off to a strong start for Iran-Russian food relations. 500 trucks laden with produce reached Moscow from Tehran, via Azerbaijan, in January 2016. Various fruit varieties, including pomegranates, were included in this shipment. 
Russian desire for fresh fruit is such that Iran is ready and willing to accommodate price changes to increase the attractiveness of its produce. Pedram Soltani, Deputy Chairman of Iran’s Chamber of Commerce, Industry, Mines and Agriculture revealed that prices of Iranian fruit intended for Russian export have had their prices amended for improved competitiveness. 
A country cannot exist on fruits and vegetables alone. What about meats and seafood? There is a massive demand for these products in Russia, and once more Iran could fill the gap currently exposed in Russian food markets. 
The two nations signed a meat deal in January 2016. Iranian officials at the time stated they could supply Russia with 10,000 tonnes of chicken meat per month or 120,000 tonnes annually. As it stands, Russia’s poultry demand stands at 200,000 tonnes per year. If Iran could sustain this level of poultry trade then the nation stands a chance at becoming Russia’s leading poultry supplier. 
May 2016 saw Iran and Russia ink a deal on joint aquafarming. Haseen Salehi, Head of the Iranian Fisheries Organisation, said his nation has the capacity to supply Russian markets with 100,000 tons of seafood every year, including shrimp, caviar and trout. 
Iranian delegations already have a major presence at many Russian trade shows, such as the country’s premier event WorldFood Moscow, further exposing the country’s produce to the Russian food industry’s key players. It is likely that Iran’s visibility in Russia will increase – alongside the number of opportunities for Iranian producers. 

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Tony Higginson

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