Iran starts guaranteed purchase of cotton

Finance Materials 8 September 2022 13:28
Tehran, Iran Trend News Agency
Iran starts guaranteed purchase of cotton

Iran’s Ministry of Agriculture is starting to guarantee purchases of cotton from the harvest in September, the director of the cotton production plan in the Ministry of Agriculture Ebrahim Hezarjaribi told Trend.

The guaranteed price for the purchases of cotton in the current Iranian years (started March 21, 2022) is 153,000 rials (about $3.6) per kilo, however, the private sector buys a major part of cotton production, he said.

An official in the Ministry of Agriculture pointed out that the agricultural support and pricing policy council of Iran is expected to announce the new price for the guaranteed purchase of cotton for the next crop year.

Hezarjaribi underlined that the price of cotton per kilo is 230,000 rials (about $5.4) in the free market and farmers expect an increase in new rates for guaranteed purchase of the product.

The number of cotton farms has increased to 112,700 hectares of agricultural land in the current year compared to the previous year's cultivated cotton in 97,500 hectares of land, he noted.

The Iranian government has provided facilities and advances to farmers for increasing cotton cultivation in the country, he said adding that 900 billion rials (about $21 million) have been assigned as loans for the purchase of cotton combine harvesters.

Hezarjaribi underlined other advances are 1 trillion rials (about $23 million) for the renovation of cotton ginning factories and 500 billion rials (about $11 million) for equipment and renovation of cotton seed factories will be providers to the private sector and cotton farmers.

The Iranian government will encourage farmers to produce and harvest cotton by offering a reward of 10 percent of the price for guaranteed purchase.

Iranian government seeks to reduce reliance on importing cotton to meet the domestic demand, cotton is a strategic and all-purpose product in the Iranian textile industry.