Focus
Sun, Nov 21, 2004
IranDaily.gif
PDF Edition
Front Page
National
Domestic Economy
Science
Panorama
Economic Focus
Dot Coms
Global Energy
World Politics
Sports
International Economy
Arts & Culture
What Prospects for Saffron Farmers?
Housing Policy
By Mehrdad Razavi

What Prospects for Saffron Farmers?
009048.jpg
Saffron constitutes 13.5 percent of Iran's non-oil exports.
Saffron, botanical name crocus sativus, is the most expensive spice in the world. Derived from the dried reddish-purple stigmas of the saffron crocus, it takes anything from 70,000 to 250,000 flowers to make one pound of saffron. The flowers have to be individually handpicked in autumn when they are fully bloomed.
The delicate flowers are harvested only in mid-autumn. The flowers begin to grow after the first rains and the blooming period is usually mid-October when the temperature is just right.
Saffron is the world's most expensive spice.
It is mainly cultivated in Kashmir, Iran, and southern Europe, particularly Spain.
Iran is the world's top producer of the spice. It supplies more than 80 percent of the world's demand with a plantation area of about 36,724 to 41,325 hectares and an annual production of 150 to 170 tons.
Due to its diverse climate and fertile soil, Iran's agriculture products are rated among the best in the world with saffron being no exception.
While saffron is planted in many regions of the country, including the southeast, Khorasan province in the northeast has the highest production share.
Vast regions in Khorasan province have managed to achieve an excellent position on the production and export of saffron over the years, to the extent that some 90 percent of saffron production in Iran is obtained from this area. The Ghaenat region is well known for its quality saffron.
Iran's saffron production has in the past decade been increasing steadily, most of which is exported overseas, mostly to the United Arab Emirates, Spain, Japan, Turkmenistan, France, Italy and even the US. The number of countries importing Iran's quality saffron is increasing, reported Persian daily Qods.

Related Figures
Some 35,000 hectares of farmlands are under saffron cultivation in the southern areas of Khorasan province.
Saffron produced in the province is estimated to reach 150 tons.
More than 85,000 households with a total population of 450,000 are engaged in the production of saffron throughout the province.
Saffron constitutes 13.5 percent of Iran's non-oil exports.
Iran exported over 68 tons of saffron valued at $37.7 million during the first half of the current year (March-September, 2004).
According to the Public Relations Department of Iran's Customs Administration, the volume of exported saffron registered rises of 29.8 percent and 52.2 percent in terms of weight and value respectively compared to the same period in the preceding year (March 2003-04).

Unrivaled
Iran continues to dominate the world saffron market.
Saffron farmers in Kashmir, for example, say they are losing out in the international market due to tough competition from Iran.
Modern farming, good packaging and storage, and moderate pricing gives Iranian saffron an edge over Kashmiri saffron.
They say ever since the saffron from Iran entered the market, the demand for Kashmiri Saffron has fallen.
Iran's major markets are the world's industrialized countries such as the US and Japan.
In 2002 alone, Iran exported $2.5 million worth of saffron to as many as 40 countries.
009042.jpg
Iran supplies more than 80 percent of the world's saffron demand.
Kashmiri farmers say modern techniques make Iranian saffron more competitive in the world market. And so, they cannot compete with Iran because the "Iranian method of cultivation is very scientific".
But the situation could soon turn otherwise given that a number of countries, such as China and Spain are eventually finding their place in the global market through use of sophisticated cultivation and packaging methods.
Even Afghanistan is emerging as a potential rival given that it has a low-paid workforce and good climatic conditions for growing saffron. The bad news is that according to government sources, smuggling of saffron corms to the neighboring country has increased significantly in recent years.
Moreover, domestic shortfalls such as a prolonged drought, poor packaging and marketing strategies are threatening Iran's position as the world's top producer of the precious spice.
Farmers have sustained heavy damages in recent years due to poor rainfalls.
Lack of water has turned large plots of lands under saffron cultivation into wastelands. Latest statistics show drought has caused more than 16 hectares of land in Khorasan to become sterile.
Insufficient funding has further aggravated the situation. Most farmers have abandoned their farmlands because they can't afford the costs of buying and transferring water to their farms.
The future could look bleak for saffron farmers, if the government does not take the necessary action on time such as supplying the required funds to compensate for damages incurred by farmers and working out strategies to boost saffron production which will be possible through employment of advanced farming technology to avert natural disasters such as drought and floods.
Export of saffron in bulk is uneconomical and it is necessary that the government provide the necessary machinery and material for packaging.
Another threat comes from a rise in smuggling.
Out of 100-120 tons of saffron destined for overseas markets annually, only 30 percent is exported through official channels.
Exports say the need for submitting foreign exchange certificates has resulted in 70 to 80 percent of the sales to be carried out through unofficial and illegal channels.

Farmers' Woes
Saffron planters in Gonabad, north-eastern Iran, say they are selling the corms of their crops to prevent the loss they may incur as a result of drought.
One saffron planter in Kakhak, near Gonabad, who has a one-hectare farm of saffron, said, ''Saffron growers will incur a loss due to this year's drought.''
He added, ''I sold the corms of my saffron to planters in Torbat-Heidarieh and Kashmar.''
Hossein Adjam, another saffron grower in the village of Zibod said the reduction of water level in the village 'qanats' (subterranean canals) has made it impossible to irrigate the farms on time.
The director of Agriculture Office in Gonabad, Esmaeel Taj-Abadi confirmed that the corms of saffron are being sold. He said every day dozens of vehicles carry the corms to other areas.
He added around 10,000 people in Gonabad earn their living through saffron plantations but this year's drought and severe heat spell will reduce saffron production by 50 percent.
"We have given the producers of saffron 350 tons of fertilizer as well as some necessary equipment for drying so that all the products are of high quality and highest standard," the official said.
Shortage of natural and chemical fertilizers, lack of modern irrigation, and successive drought in recent years are among the major problems growers are facing, he said.
"There are not enough facilities for packaging".
Although Iran has less land under cultivation for saffron than Kashmir, but the yield there is four times as high because of irrigation.
Analysts believe that the government should give Iranian saffron a distinctive trademark, to enable it to be distinguished from its other competitors, especially from Kashmir and Spain.

Housing Policy
By Mehrdad Razavi
009045.jpg
Currently, the government's share in the housing sector is less than 10 percent.
Various economic indices reveal that the government's housing policy in the past few years has not been successful. This is because the cost of housing and rentals are beyond the purchasing power of most people.
Another problem is that the residential units currently being built are not of high quality. Many new housing complexes remain inhabited even while a large number of people are in need of housing.
Given the ups and downs in the housing market, the Ministry of Housing and Urban Development should take effective measures to resolve the people's grievances.
The government has so far resorted to various measures to improve conditions in the housing sector. One measure was offering housing loans. But this led to stagnation and experts believe that granting loans would be effective only when the prices remain fixed for at least several months.
The reality is that the faulty policies of those in charge of housing have led to astronomical prices, which transcend the purchasing powers of the people. Experts also maintain that in a robust economy, only five percent of national assets should be allocated to the housing sector. This is while in our economy the figure is much higher. The point is that when housing investments comply with the real needs of the society, then the situation of unwanted fluctuations in the housing market will not arise.
Currently, the government's share in the housing sector is less than 10 percent. If this figure increases to 50 percent, then we can be hopeful that the market would become realistic.
One policy that officials are currently pursuing is to help support housing cooperatives, increase the number of banking facilities offered to the people and reduce the profit rate on housing loans. This policy could help overcome the dilemma of housing in the long run. The government should also try to curb the role of middlemen in the market. When the people can directly find a suitable place of residence without taking recourse to agents, then many of the problems will fade away.