At the beginning of the meeting, Farhad Dejpsand, Minister of Economy and Finance, said that a detailed report was presented to members of the government at last Wednesday’s cabinet meeting, which was based on Iran’s customs statistics; In that report, the amount of inventory of basic goods, raw materials and goods required by the production line was discussed separately by gender and a detailed discussion was held to facilitate the process of customs clearance of goods.
He added: “On Saturday, the First Vice President, together with the Ministers, the Governor of the Central Bank and the Director General of Customs, visited the port of Shahid Raja’i to prepare the conditions for the clearance of goods.” This is not at all something that wants to stimulate the demand for foreign exchange, but this clearance includes goods that have been operated before the 5th of October and are not included after that; Also not included in Group Four goods.
“In order to facilitate the clearance of goods left in customs, there is no need to worry about stimulating foreign exchange demand, because this includes basic goods and goods needed by production lines, so it does not increase foreign exchange demand,” he said.
Dejpsand continued: “In special economic conditions, it was decided to provide conditions that basic goods and raw materials of production do not remain in customs, while some items left in customs were perishable, so taking measures to clear them can be useful.
Dejpsand said: “The government is unanimous in preventing the stimulation of foreign exchange demand, and therefore the government should also decide on the clearance of goods from the free zones.”
Clearance of goods from free zones stimulates foreign exchange demand
Mohammad Reza Poorabrahimi, Chairman of the Economic Commission of the Islamic Consultative Assembly, continued the meeting: “The issue of clearance of goods from free zones, especially free zones, which cannot be separated from the mainland, is provoking foreign exchange demand and is worrying.”
Poorabrahimi said at the 98th meeting of the Government-Private Sector Dialogue Council: “We received a report that the Vice President for Legal Affairs is pursuing the clearance of goods that have come from the exit of the free zones.” This creates a new impetus in stimulating foreign exchange demand, since it is not possible to separate a large number of free zones from the mainland.
Poorabrahimi said: “My request is that a special order be issued regarding foreign exchange policies, exports and issues related to the extension of the business card.”
He continued: “In order for exporters to benefit from working capital facilities, it was decided that exporters should act through Sepidar system, but with the problems in this system and the problems related to recent decisions related to the export field, only three to five percent of exporters were able.” Use this system while facing problems for their next export; Therefore, the report of Sepidar system is designed based on the provisions of Article 1 of the Non-Oil Export Support Package of 1998 regarding the deposit of the National Development Fund in operating banks to pay working capital facilities for export, and exporters can submit their applications to the organization through this system. Announce the development of Iran’s trade.
After that, the meeting of the Government-Private Sector Dialogue Council entered the main agenda of the meeting. Gholam-Ali Soleimani, a member of the Government-Private Sector Dialogue Council, said of the problems of the private sector and producers: “Export companies are severely affected. We do not know at all what to produce and how to import currency.” Our hands are really tied; The main problem is that the currency is multi-currency, and the government must once again decide to monopolize the currency. Soleimani continued: “Politics should be in the hands of the economy, not the economy in the hands of politics.”
Report on the supply and distribution of livestock inputs
Following the meeting, Mohsen Ameri presented a report on the results of the review of the working group of the Dialogue Council and the reports received by the Secretariat of the Council on the supply, distribution and production of livestock inputs.
Referring to this report, he said: “Investigating the problems of supply and distribution of livestock inputs and production of livestock and poultry feed in the country was the subject of the Iranian Association of Livestock, Poultry and Aquaculture Industries, the Union of Importers of Livestock and Poultry Inputs and the National Poultry Association of Iran.” The government and the private sector have proposed the provinces of West Azerbaijan, South Khorasan, Khorasan Razavi, Kerman, Mazandaran and Markazi.
It is said that the disruptions in the market and prices of protein products in recent months due to the continuing unhealthy situation of supply and distribution of livestock inputs, has caused this issue to be on the agenda of the Dialogue Council at the request of organizations and related economic actors in different provinces.
He continued: “In recent months, the problem of non-timely allocation of foreign currency by the Ministry of Industry, Mines and Trade, lack of timely provision of foreign currency by the Central Bank and the depot of livestock inputs in ports caused a shortage of supply and increased livestock inputs several times the government rate.” Has been. This problem is not only in the stage of providing foreign exchange, but also the shipments for which they have been allocated have not benefited from providing high quality and transferable foreign exchange, so that if the central bank does not provide high quality foreign exchange, regardless of the problems related to their transfer, conversion and transfer through Authorized exchanges impose a significant additional cost on the importer.
Amiri stressed: “On the other hand, the goods stored in customs are undergoing decay due to improper and long-term storage and may lead to livestock and poultry diseases if consumed, thus challenging food security and public health.” With the current situation, importers no longer have an incentive to import.
According to Ameri, the disruptions in the supply and clearance of foreign exchange and the problems that arose in the import and supply of livestock inputs, on the one hand, and the lack of transparency and inefficiency in distributing the same amount of inputs, on the other hand, have strengthened the hypothesis that allocating 4,200 Tomans to inputs It creates livestock, corruption and rent. In a situation where producers procure most of their livestock inputs from the open market and at a high price, the currency of 4200 Tomans has been made in the name of the producer but to the speculators. Therefore, the proposal of the majority of private sector organizations is to streamline and reform the distribution system based on the value chain in the long run, which is based on removing government currency from imports and spending it as a subsidy in the consumption and production sector. Thus, the distribution of inputs can be done through value chains (ownership or management) and feed mills, which in total will reduce the cost price, improve the conversion rate and ultimately reduce imports and save on currency outflows.
According to Ameri, livestock inputs are supplied by suppliers in the market system of agricultural inputs, but according to economic activists, the amount of inputs offered in the market system is only about 20 to 30% of the feed needed by producers and does not meet the needs of producers. In addition, there are some problems with the distribution of the same amount of input, which indicates the lack of transparency of this system in some aspects. As a group of protesters, they have a limited period of 12 hours to pay for and deliver the shipment, but it is claimed that some of the allocated shipments are sometimes kept for more than a month in reserve for some customers.
He continued: “Apart from all these problems, the grammatical policies of market regulation should not be forgotten. The government’s regulatory policy fails to set the approved price for chicken and other protein products, so that the approved price of these products differs significantly from the market price.
Amiri referred to the plans of the Market Regulation Headquarters: The amount of production (hatching) by the Market Regulation Headquarters and the planning for its production by the Ministry of Jihad is done regardless of the volume of available and available input. Decision makers in this area should be aware that despite the problems of allocating and securing foreign exchange, as well as the inefficiency of the distribution system, the amount of imported input does not necessarily mean the available input. Therefore, production planning on this basis fails, and one of the consequences is the slaughter of day-old chicks, which has been observed in recent years.
A part of the report presented by Ameri states: Following the issues and problems received from the provincial councils, dialogue between the government and the private sector and economic organizations active in the livestock and poultry industry in different provinces of the country regarding the problems of supply and distribution of livestock and poultry inputs. The Secretariat of the Council, in accordance with its legal duty, reviewed the issue and held expert meetings in July, September and October of this year.
In this meeting, several issues such as currency allocation problems and problems related to the clearance of imported inputs, problems caused by the distribution method and market system, sectoral decisions of various devices, lack of access to economic information for production decisions, order pricing and others The problems in the field of distribution and their effects on the livestock and poultry industry were discussed. The working group addressed the issue that the Anti-Sanctions Headquarters of the Supreme National Security Council in July 1998 issued a resolution to expedite the supply of items needed by the country, according to which it allowed customs to clear a percentage of priority goods 1 and 2. The group of goods in the customs, etc. should act. Continuation of the implementation of this decree could have solved the current situation, but in July of this year, the Central Bank issued a circular that actually implemented the implementation of this decree.
He continued: in order to improve the input distribution system, the solutions were reviewed in three time periods, so that in the short term, suggestions were made to clarify and solve the problems of the market system, in the medium term, proposed solutions to prevent the sale of raw animal inputs and The capacity of feed mills was agreed upon and in the long run it was proposed to reform the structure of the value chain based distribution system.
Finally, the government’s grammatical policies were discussed, which ultimately led to the proposal of private sector participation in determining the expert price and production planning commensurate with the input of the currency provided.
Amiri said that the most important problems in the field of livestock institutions are the lack of allocation and supply of currency, the inefficiency of the distribution system and the orderly policy-making in the field of price and production.
Regarding the issues of non-allocation and provision of foreign exchange, he said: “Non-allocation of foreign exchange to imported consignments of livestock inputs that have been legally registered, ordered and imported.” Also, failure to provide high quality and transferable foreign exchange for imported consignments of livestock inputs that have received foreign exchange; Repeated payment of fees related to obtaining permits required for clearance of imported consignments during the period when the consignment is in the allocation queue or waiting for foreign exchange; Destruction and corruption of goods stored in customs and sediment livestock inputs in ports; The payment of heavy demos by importers is the most important problem in this sector.
He also described the problems of the distribution system as inefficient:
– Supply of raw input to livestock and poultry breeders, production of non-standard feed in an unsuitable environment with the possibility of transferring contamination to livestock and poultry farms, reducing production efficiency and ultimately wasting limited foreign exchange resources
– Lack of transparency of the market system in the distribution processes and the impossibility of monitoring and monitoring it
– Inequality of time and opportunity to buy in the system for applicants
– Delivery is delayed against cash purchase
– Impossibility of responding properly to buyer’s objections to delayed delivery or input quality
– Limited supply and disproportionate to the time required by the manufacturer for production planning (hatching, slaughter, etc.)
Lack of sufficient inputs and extermination of day-old chicks
– Lack of food at the right time and late slaughter or lack of sufficient food and early slaughter
According to the report, the main obstacles in the field of grammatical policy in the field of price and production are:
– Obligation to comply with approved prices for protein products (chicken, eggs, etc.) while only about 30% of inputs reach producers at the approved rate
– Lack of attention to existing, available and manageable inputs in production policy and planning
– Lack of attention and non-consideration of livestock and poultry related industries in the list of occupations affected by the outbreak of coronavirus, while this industry not only accepted the risk and duty in the quarantine period while it was active and production, but in terms of sales much lower than the price The finished product is also affected.
Finally, the Secretariat of the Dialogue Council made three proposals for improving the status of short-term, medium-term and long-term proposals, which include allocating and providing high-quality and transferable currency for the import of livestock inputs, reforming the distribution system of livestock inputs and livestock and poultry feed. .
Accordingly, it was suggested: to solve the current problems of the distribution system and the market system in the short term; Joint committees should be formed between the Ministry of Jihad Agriculture, the Ministry of Industry, Mines and Trade, regulatory bodies, the Iran Chamber and related economic organizations in the private sector to continuously monitor the performance of the market system in distributing livestock inputs and remove obstacles and related problems.
According to Ameri, the proposal of the council secretariat in the medium term is not to distribute the input in raw form and to distribute ready-made industrial feed. It was also suggested that in the long run, modification of the distribution structure based on value chains should be on the agenda. There is also a need to redesign the distribution system of inputs in the country based on value creation chains (management or ownership chains).
Food security is at stake
After this report, Hamid Reza Hajibabaei, the head of the Program, Budget and Accounts Commission of the parliament, pointed out the importance of this report and spoke about the transparency in the way of allocating currency and the issues and problems of exporters.
After that, Mashallah Azimi, Secretary General of the Cooperative Chamber, spoke about the problems of animal feed.
He stressed that the food situation in the market is bad and this is the beginning of the problems that eventually affect the economy in a capillary way. The economic situation of the country is urgent and something must be done according to the situation.
Azimi said: “If the hatchery is delayed for 15 days, it means that in a period of time, the chicken will become more expensive and a solution must be found for this issue.”
He stated: the model of currency allocation should be different, now no one is satisfied with the situation and the officials should think seriously about the country’s economy; Food security should not be compromised.
After that, the president of the Association of Livestock, Poultry and Aquatic Feed Industries said about the problems of supplying livestock inputs: about 80% of the supply of livestock inputs in the country is done from the place of import; At least 70% of the cost of protein products such as chicken, eggs, milk, red meat and دام is related to animal feed; Therefore, any disruption in the supply and distribution of these inputs will face serious challenges in the production of these products.
He continued: “In recent months, the problem of late allocation of currency by the Ministry of Industry, Mines and Trade and the lack of timely provision of currency by the Central Bank and the depot of livestock inputs in ports caused a shortage and supply of livestock inputs several times the government rate.” Has been. This problem is not only in the stage of providing foreign exchange, but also the shipments for which they have been allocated have been deprived of providing high quality and transferable foreign exchange so that if the central bank does not provide high quality foreign exchange, regardless of the problems related to their transfer, conversion and transfer. Through authorized exchanges, it imposes a significant additional cost on the importer.
Majid Movafeq Ghadiri, referring to the problems of selling raw animal inputs, said: “Feed production should be stopped in breeding units.”
He also referred to the Fund for the Support of Animal Feed Factories, which he said needed to be set up.
The poultry industry is collapsing
Gholam-Ali Faraghi, President of the National Poultry Association of Iran, said about the bad situation of the poultry industry: “In the last six months, this industry has suffered so much that it cannot be compensated.” What must the producer do to be able to survive?
He continued: “When chicken becomes expensive or scarce, no one questions the executor and the decision-maker, and all the producers are blamed.” The producer is the executor of non-expert decisions. The ordered price and the prices below the cost price have broken the manufacturer’s back.
He stressed: “The structure of industry is costly, the distribution system is difficult and we must think about the industry and save it.”
Khalili then spoke to the Association of Livestock Input Importers about the need for a single currency.
Another private sector activist said that the poultry industry was caught between the decisions of the two ministries of Jihad, Agriculture and Industry: “Import and export are in the hands of one ministry, distribution and market control are elsewhere, and production issues are resolved elsewhere;” All these islands of practice and inconsistencies have caused the poultry industry to deteriorate today.
Following the meeting, Omid Gilanpour, Deputy Minister of Development of Transformation Industries and Agricultural Businesses, spoke about the market and the problems of this system and the work that is being done to improve it.
There is a risk of closure
In this meeting, they talked about the market system and the conditions for supplying livestock inputs by suppliers in the agricultural input market system. According to economic activists, the amount of inputs offered in the market system is only about 20 to 30% of the feed required by the country’s producers and does not meet the needs of producers. In addition, there are some problems with the distribution of the same amount of input, which indicates the lack of transparency of this system in some aspects. As a group of protesters, they have a limited period of 12 hours to pay for and deliver the shipment, but it is claimed that some of the allocated shipments are sometimes kept for more than a month in reserve for some customers.
An economic activist from Mazandaran province said: “Producers are struggling with the problems of providing livestock and poultry inputs, a number of producers have said goodbye and large poultry and livestock units are looking for alternatives to these inputs in the livestock and poultry diet.” Poultry farmers have reduced their production. Sixty percent of feed mills have also been shut down by the Ministry of Jihad for Agriculture due to a lack of livestock inputs.
He cited regulatory market policies that failed to set approved rates for chicken and other protein products. Decision makers in this area should be aware that despite the problems of allocating and securing foreign exchange, as well as the inefficiency of the distribution system, the amount of imported input does not necessarily mean the available input. Therefore, production planning based on this is failing and one of the consequences is the slaughter of day-old chicks that has been observed in recent years.
The missing link is the central bank
Following the meeting, Seyed Javad Sadati Nejad, a member of the Economic Commission of the parliament, criticized the absence of government representatives in the meeting of the Government-Private Sector Dialogue Council and said: “The problems mentioned by economic activists here show that government agencies have not done their job properly.” Based on these statements, incorrect order registration, prioritization and pricing are not accurate. However, the Ministry of Agriculture is not present at the meeting, which indicates that the plague is elsewhere.
He continued: “The lost central bank is all of us today, no country treats its food security like this; The solution to all economic problems is in the hands of the private sector, provided that this area is left open. The private sector must be trusted.
Support for the real exporter is on the agenda
Afterwards, Mohammad Baqer Ulfat, Deputy of the Judiciary, spoke about the work done by the Judiciary to support the private sector and real exporters in filing lawsuits. Solve your problem with measures and deal seriously with abusers.
He also pointed to the nature of the Dialogue Council meeting, where producers and economic actors should be demanding.
In the end, Farhad Dejpsand said: the economic atmosphere of the country needs calm and we should try to solve the economic problems of the country and the poultry industry with consensus, empathy and cooperation. It was decided to pursue the solution of market problems sometimes in agricultural jihad; Also, an extraordinary meeting will be held in the presence of the Governor of the Central Bank, the Ministry of Industry, Mines and Trade in the next two weeks to discuss issues in the field of exports and foreign exchange allocation.