Against the background of the situation arising from the war, an increase in the price of potatoes is observed in some provinces and major cities of Iran. For this reason, Iran's Ministry of Agriculture has issued instructions to send potatoes from reserve funds to domestic markets. At the same time, the export of potatoes from the country has been temporarily suspended. Considering that Azerbaijan also partially imports potatoes from Iran, the impact of this decision on the local market is a focus of attention. The price of potatoes in Azerbaijan has been gradually increasing in recent days. In your opinion, to what extent is this price increase related to Iran's export restrictions, and when might the price rise ease?
In a statement to Medianews.az, economist-expert Asif Ibrahimov said that, against the backdrop of tension in the region due to the war, the increase in potato prices in Iran and the consequent temporary suspension of exports have caused some concerns in the Azerbaijani market:
“We all see all problems through the lens of the war. However, when analyzing the current situation, we see that the price increase of potatoes observed in Azerbaijan should not be linked solely to the Iranian factor. Iran's share in Azerbaijan's potato imports is limited, and the market is formed more through other countries. In this regard, Iran's export restriction does not create a serious structural shortage in the market.”
The expert noted that nevertheless, the mentioned decision creates a psychological impact on the market in the short term, leading to price increases:
“Another important factor is related to seasonal factors. Currently, mainly last year's product is offered in the market, and the reduction of reserves puts pressure on prices. At the same time, the higher production cost of products brought from alternative import sources is also among the factors that condition the price increase.”
A. Ibrahimov stated that in the coming months, especially from the period of April-May, with the entry of the local new product into the market, price stabilization and some decrease can be observed:
“If geopolitical tension in the region does not deepen further, the current price increase is not expected to be long-term. As a result, the existing price increase mostly has a short-term and situational character, and there are no significant changes observed in the fundamental balance of the market.”
Oguz Ayvaz
Medianews.az