Iran’s wheat planting at risk amid delays in government payments to farmers

Iran’s autumn wheat planting campaign for the 2027 harvest is taking place amid cash shortages among farmers caused by delays in government payments for the previous crop. Farmers are forced to purchase seeds, fertilizers and crop protection products and cover fieldwork expenses without having received full payment for grain already delivered to the government. High inflation and the depreciation of the Iranian rial are further complicating the situation, significantly reducing producers’ purchasing power.

According to Iran’s National Wheat Foundation, between 10% and 30% of payments for purchased grain remain outstanding in some provinces. Meanwhile, the government’s Targeted Subsidies Organization reported that, as of October 9, farmers had received 3.92 quadrillion rials out of a total of 4.1 quadrillion rials owed. This leaves approximately 180 trillion rials, or $69 mln at the current exchange rate, unpaid. The delays are attributed to discrepancies in government agencies’ administrative records.

The sharp depreciation of the national currency is putting additional pressure on farmers. The previously established maximum guaranteed wheat purchase price of 495 mln rials per ton was equivalent to approximately $298/t when it was approved, while its dollar value has now fallen to $189/t, a decline of 36%. Meanwhile, wheat seed prices have been set at 720,000–756,000 rials per kilogram, at least 45% above the guaranteed government purchase price for commercial wheat.

Due to working capital shortages, some farmers are forced to sell their grain to middlemen at 380,000–440,000 rials per kilogram, compared with the maximum government purchase price of 495,000 rials. This allows farmers to obtain cash more quickly for the planting campaign but reduces their income. The situation is further complicated by the government’s failure to announce a guaranteed wheat purchase price for the 2026/27 agricultural year, making it difficult for producers to plan expenses and estimate expected profitability.

Agricultural industry representatives warn that further payment delays could negatively affect farmers’ decisions on wheat planting areas and production in the new season. If the situation deteriorates, it could create risks for domestic grain supplies and the replenishment of government reserves, potentially increasing Iran’s demand for imported wheat. However, the actual scale of any future production decline remains uncertain.

Tags: Iran, wheat, wheat planting