Farmers across Iran are shouldering the heavy financial burden of delayed government settlements for their wheat harvests, facing mounting production costs while dealing with severe currency devaluation and administrative bottlenecks.
Cash Outlays and Deferred Payments
Agricultural producers described having to pay cash upfront for seeds, fertilizer, pesticides, labor, irrigation, and other necessary operational expenses while waiting for state compensation for crops already delivered to storage facilities. According to a farmer in the Sanjabi area of the western province of Kermanshah, the hold-ups have made it increasingly challenging to afford basic daily requirements. Most farming expenses require immediate cash settlements, while the state issues reimbursements in installments. Another grower in western Iran noted that rapid inflation and the depreciation of the Iranian rial meant delayed payments lost substantial purchasing power by the time they finally arrived. Between 10% and 30% of payments owed to wheat farmers remain outstanding across various provinces, according to Ghadam Borbor, deputy head of Iran’s National Wheat Foundation.
Currency Depreciation and Shrinking Margins
The government established its guaranteed wheat purchase price for the previous agricultural year earlier this year, setting it between 475,000 and 495,000 rials per kilogram based on the quality of the crop. At that time, the United States dollar traded at 1,663,700 rials on the open market, making the highest guaranteed rate equivalent to approximately $298 per ton. At the current open-market exchange rate of about 2.615 million rials to the dollar, that same 495,000-rial payment is worth about $189, marking a decline of approximately 36%. While the government’s nominal debt has remained unchanged, currency depreciation has severely eroded the dollar value of farmers’ earnings, leaving them struggling to afford supplies for upcoming planting cycles.
Iranian wheat farmers told Iran International that delayed government payments for their previous harvest are leaving them short of cash for autumn planting, while inflation and the falling rial erode the value of money they are still owed.Farmers described having to pay cash… pic.twitter.com/79xgjaBcMl
Administrative Discrepancies and Unpaid Balances
According to figures released on October 9 by the Targeted Subsidies Organization, the state body responsible for administering subsidy payments, approximately 3,920 trillion rials—valued at $1.50 billion at current open-market rates—had been paid out of the 4,100 trillion rials, or $1.57 billion, owed to wheat producers. That left roughly 180 trillion rials, or $69 million, still outstanding. Hassan Norouzi, head of the organization, attributed some of the holdups to data discrepancies between its records and those of the Ministry of Agriculture, stating that final distributions depend on correcting information within administrative systems.
Meanwhile, the Ministry of Agriculture set wheat seed prices at between 720,000 and 756,000 rials, or $0.28 to $0.29, per kilogram. This pricing sits at least 45% above the highest guaranteed government purchase price of 495,000 rials per kilogram for harvested wheat. A farmer in Nourabad told Iran International that the situation was becoming unsustainable. Growers must buy seeds with cash even while owed money from past deliveries, leaving little incentive to continue operations under such financial strain.
Recourse to Middlemen and Rising Bread Costs
Faced with urgent cash needs, some agricultural workers have turned to intermediaries, selling their wheat below the guaranteed state rate. Peyman Alemi, head of Iran’s Chamber of Agricultural Guilds, stated that producers needing immediate funds were selling harvests to middlemen for between 380,000 and 440,000 rials per kilogram. Alemi warned that ongoing payment delays could discourage producers from selling future harvests to the state, potentially reducing domestic output and increasing reliance on costly foreign grain imports.
Simultaneously, bread prices have climbed across urban centers, adding strain to household budgets. In Tehran, officially approved prices place a traditional sangak flatbread at 155,000 rials, or about $0.06, while barbari bread costs 100,000 rials, or roughly $0.04. Bakeries operating outside subsidized pricing structures charge considerably more, with some varieties of sangak reaching 500,000 rials in Tehran and 400,000 rials in Mashhad. With the new 1405–1406 agricultural year (2026–2027) already underway without a confirmed guaranteed purchase price, producers enter another planting season facing unresolved debts and deep uncertainty regarding future crop valuations.
