Foreign-Exchange Compliance Rules Driving Saffron Smuggling — One‑Third of Iran’s Saffron Leaves Illegally

Citing his official information portal, Ali Shariati Moghadam told Eghtesad Online that Iran’s saffron market is heavily affected by cross‑border smuggling. The phenomenon, he explained, stems partly from the commodity’s nature — a high‑value, low‑volume, low‑perishability product with strong global demand.

Currency Obligations Behind the Surge in Smuggling

Shariati Moghadam stated that the tougher foreign‑exchange commitment rules imposed since 2018 (1397) have been a major driver of saffron smuggling. “The unilateral and increasingly rigid regulations,” he said, “have led exporters to use single‑use business cards or informal channels to ship saffron to destinations such as Afghanistan, from where it is re‑exported to other countries.”

He added that legitimate companies investing in saffron production are now facing multiple obstacles — from sanctions and financial‑transaction barriers to the impractical currency‑clearance system — causing them to lose competitiveness in international markets. Consequently, a large share of Iranian saffron is exported in bulk and unbranded form, depriving producers of added value.

One‑Third of Iran’s Saffron Traded Illegally

Forecasting increasing challenges ahead, Shariati Moghadam warned that saffron smuggling and the use of disposable trade cards will continue to undermine formal exporters.

He noted that:

• About one‑third of Iranian saffron exports come from long‑established, reputable companies.
• Another one‑third is shipped using single‑use export cards, often leading to illicit trade.
• The remaining one‑third is smuggled outright, bypassing all trade‑compliance systems.

“There are no precise statistics,” he said, “but roughly one‑third of Iran’s saffron is smuggled.”

Why Afghanistan Has Become a Smuggling Route

Explaining the root causes, Shariati Moghadam cited geographical proximity to Khorasan Province, Afghanistan’s own saffron cultivation, and the simpler tariff regime Afghanistan enjoys when exporting to markets such as India, the United States, and Arab countries.

“These advantages,” he concluded, “encourage Iranian saffron to be smuggled into Afghanistan, processed or re‑packaged there, and then re‑exported under different origins.”

Original Title: Foreign‑Exchange Compliance Rules Driving Saffron Smuggling — One‑Third of Iran’s Saffron Leaves Illegally

Source: Eghtesad Online

Publication Date: February 27, 2025 (8 Esfand 1403)

Original Link: https://vista.ir/n/eghtesadonline-7b1r7