Iranian poultry industry bounces back

Iran has regained the position of a net poultry exporter. Photo: Canva

Following last year’s production turmoil, Iranian poultry farmers have stabilised production and even re-launched exports. However, according to local market players, several systemic issues continue to plague the poultry industry.

Iranian poultry production rebounded in the 1403 Persian year, starting on 23 March 2024, Ali Ebrahimi, chairman of the board of the National Union of Goshti Poultry Farmers, told local news outlet Balag.

Ebrahimi recalled that last year, Iran had to resort to chicken imports to fill the gaps in the domestic market left by crumbling domestic production.

This year, however, the market has some production surplus, allowing farmers to resume chicken exports. He revealed that Iran has regained the position of a net poultry exporter in the current year, selling roughly 13,000 tonnes of poultry to foreign customers, primarily in Iraq.

Chicken prices have also stabilised. Ebrahimi said that during the harsh deficit, the price per kg of broiler meat went up to 30,000 tomans, occasionally reaching 40,000 tomans. Now, it ranges at a comfortable level of 25,000 to 27,000 tomans per kg, roughly equal to US$2.5 per kg, though calculating the cost of Iranian goods in international currency is tricky as the national currency exchange system is confusing.

Currently, Iran has 3 exchange rates: the open market rate, the official rate and the Central Bank’s NIMA rate.

No poultry shortage

Occasional reports indicated that Iran experienced a steep decline in broiler meat consumption owing to a price hike last year.

Ebrahimi indicated that Iran is expected to manufacture 3 million tonnes of poultry this year, which would be more than enough to fully meet domestic demand. He praised the steps taken by the government to help poultry farmers restore operations, noting that ‘final consumers benefited the most from the state policy’.

However, officials warned that despite a short-term improvement, the Iranian poultry industry still faces some long-standing issues that drove it to the crisis.

Financial issue

For instance, Mohammad Ali Rezaei, the head of the Agriculture Commission of the Chamber of Commerce, has called the government to deal with the key problem crippling the poultry industry, namely the existence of multiple exchange rates of the Rial, the national currency.

He explained: “The extreme fluctuations of the exchange rate have made it difficult for poultry farm managers to accurately plan the required inputs and raw materials. This, in turn, leads to an increase in production costs and instability in the supply chain.”

The key challenge is that the ups and downs in the exchange rate, coupled with inconsistent government policy in this field, make predicting production costs an extremely difficult task. As a result, Rezaei admitted, investors are not willing to pump their money into the poultry industry.

A single national currency exchange rate would lay the foundation for the sector’s sustainable development, Rezaei asserted.