Iran to use one mln hectares of land in Venezuela

Iranian official said Venezuela has agreed to provide one million hectares of agricultural land for Iran’s overseas cultivation projects to secure food.

Announcing the agreement last week, Head of Cross Country Agriculture Association of Iran Ali Rezvanizadeh said Venezuela can provide a better opportunity than Brazil and Russia for Iran’s overseas agricultural projects, including growing crops of soy beans and corn.

According to Rezvanizadeh, Iran requires 7 million hectares of overseas agricultural land to ensure its food security, but Iranian investments have been on a much smaller scale so far.

The private sector investors are mainly driven by higher profit margins in their overseas cultivation projects. According to Rezanizadeh, of the 30 million tons of all agricultural products imported, only 7 percent comes from overseas cultivation projects. This includes investment in crops such as bananas and other exotic fruit which have a much higher profit margin than strategic crops such as wheat, corn, rice, and oilseeds.

Masoud Daneshmand, former chairman of Iran Economy House, a private sector think tank, however, says Iranian investment in production of crops such as corn and soya beans in Venezuela is not economically viable due to the very long distance between the two countries and the high cost of transportation.

Tehran and Caracas last month announced a 20-year cooperation plan in the fields of oil, refining, petrochemicals, defense, tourism and culture, and agriculture during President Nikolas Maduro’s visit to Iran. The plan also includes repair of Venezuelan refineries and the export of technical and engineering services.