FOR some Iranians, it's a galling thought: the United States may oust Iran as the world's largest producer of pistachio nuts this year because of one of the worst harvests ever in the Islamic republic.
The popular nibble is Iran's main export commodity outside the oil sector, earning it more than $1 billion last year, and providing many people with jobs in the arid, south-eastern province of Kerman, which has 140,000 pistachio farmers.
Unusually
cold weather during the flowering in April dealt a blow to the 2008 crop, which farmers say is down by as much as 75 per cent from last season's record of 280,000 tonnes.
The poor harvest follows a severe drought that is forcing Iran to import millions of tonnes of wheat and causing power shortages in the world's fourth-largest crude producer.
"We actually never had production as low as this," said Behrooz Agah, whose grandfather pioneered exports of the split-shelled nuts in the 1930s.
"For Iranian pistachio farmers, yes, it is a crisis," he said, standing in sweltering heat amid rows of trees with bunches of the red-green nuts growing in desert-like terrain.
For Iran's pistachio farmers, the most pressing problem is this year's crop failure at a time of growing demand from new consumers in countries such as China and Russia. Big farms employ hundreds of mainly Afghan labourers during the harvest in September. But this season warehouses stand half-empty and machines lie idle.
"Workers are going to be laid off," said Ali Alizadeh, who manages a processing plant where the nuts are cleaned and dried. He expected the firm's exports to fall by around 70 per cent.
The pistachio problem alone would be serious enough in a country where the official jobless rate is around 10 per cent, but there is also a political dimension.
The Sarmayeh business daily said last month that the United States might this year produce more pistachios than Iran for the first time.
"Americans are using all advertising tools and their financial power for victory in this market," it quoted Mohammad Hossein Karimipour, head of the agricultural commission of Iran's chamber of commerce, as saying.
The US has more than doubled production in the past decade to about 190,000 tonnes in 2007, most of it in California. With a good pistachio year usually followed by a weaker harvest, California's output is expected to fall to £260-270 million in 2008, but this would still be more than many are forecasting in Iran.
Washington severed ties with Tehran shortly after Iran's 1979 Islamic Revolution and the countries are now also at odds over the Islamic state's disputed nuclear activities, which the West suspects are aimed at making bombs. Iran, which is under US and United Nations sanctions, denies the charge.
A report in the Iran Daily newspaper in June said the United States tried "to improve its position in the global war of pistachio production and export by undermining Iranian trade in every way".
Others are more sanguine. Mehdi Agah said he expected Iran to take back the number one spot next year.
He and others in Kerman, a province of 2.7 million people where pistachios are the main source of income for one fifth of the population, played down the Californian angle and said water shortage was their chief concern.
Mohsen Jalalpour of Kerman's chamber of commerce said lack of water after years of below average rainfall could cut output.
The Pistachio Association is hoping for government backing to help shift production to other parts of Iran where there is more water, for example in the west.
"If we do this… there will be no fear of American competition," said Mr Agah.
BACKGROUNDIRAN is now three times more reliant on its oil and gas wealth than ten years ago.
Mehdi Agah, a board member of Iran's Pistachio Association, said the country was experiencing the so-called Dutch Disease, where the value of a currency is strong because of lucrative hydrocarbon exports, hurting the ability of other sectors to compete internationally.
"Already the carpet industry has lost business to the Dutch Disease," he said, referring to another export earner.
The full article contains 708 words and appears in The Scotsman newspaper.
