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Iranian saffron deposit certificate and its problems

A certificate was recently issued at a ceremony in Mashhad for the deposit of saffron to uncover prices in the stock exchange, a step to boost and organize a unique product that more than 90% of its global production is located in Iran. Based on this plan, by allocating a warehouse to the Khorasan Rural Cooperative Union, saffron is exhausted after a limited test, and a certificate or an inventory bill is issued to provide the seller in the stock exchange. This product has the ability to be kept in the warehouse in a one-year period and the owner is the last person to whom the documents are issued and who is interested in delivering it. But with the onset of the activities of saffron tools on the stock exchange, many questions and ambiguities have arisen that could seriously undermine the success of the project. In order to examine these ambiguities in the past, the use of saffron in the form of a stock exchange will not be useless.

Unofficial Exchange of Saffron in Mashhad

December 2001, about 3 years before the Iranian Agricultural Exchange was established in September 2004, with the support of the private sector and with the support and support of the Ministry of Agriculture’s Department of Horticulture, the Foreign Trade Development Center, Khorasan Governorate and a group of Islamic Consultative Assembly members, the first stock exchange Agriculture was established at the official site at a suitable location from the Khorasan Industries Organization located at Khayyam Blvd., Mashhad. In the center, which operated with an incomplete model of world agricultural stock, saffron was traded in standard appearance. Although the life of this stock exchange did not last long, and with the establishment of the Agricultural Stock Exchange of the country, it was agreed that saffron would be among the first products accepted in the stock exchange at the same time as the informal exchange was closed, but it was not forbidden to anyone. Private has had a direct impact on the formation of stock exchanges, especially since the center has been visited frequently and studied by officials, experts and, in one go, by all representatives of the Agriculture Committee of the Parliament. Unfortunately, the unilateral view on this official exchange broke not only the slaughter of saffron in this new center, but also the record of agricultural stock, with errors and weaknesses in management.

Buy Guaranteed Saffron, No Achievement for Shares

In the years 83 and 84, the price dropped sharply due to the low increase in saffron production and the continued long-term policy of establishing a currency exchange rate with the rial (which is always an increase in this parity of export incentives). The increase in wages, the maneuver of foreign representatives of international companies on the farm, and the inability of exporters to enter the world-rich world markets went so far as to disappoint some people from the cultivation and business of saffron, and some farmers began to change their bluefields; a product whose main gain It went into the pockets of international intermediaries and was distributed to farmers. In the meantime, with the efforts of representatives of farmers, exporters and MPs, 16 billion tomans of low-value facilities were approved by the Agricultural Bank to buy saffron guarantees in the government, and the Rural Cooperative Union was elected as the host of the project. With the allocation of this budget, it was decided that direct purchase through the designated centers in Mashhad and several other parts of the province at a price of about 400 thousand tomans and more depending on the type of saffron, and after sufficient tests, will be supplied with different standards on the stock exchange. The idea of ​​selling saffron on the stock exchange was due to the fact that with the swap of trading, more purchases, clearer deals and urgent action were taken to discover the price, but the stock exchange organization, by locating its warehouses and laboratories, monitored the purchasing process, in general The plan was eliminated and 50 tons of saffron bought in the warehouse of the Khorasan rural cooperative union were kept in poor condition and sold with gradual increase. This guaranteed volume of government purchases instantly raised prices and saved saffron at that historic and hard time. While this supportive measure was expected to permanently turn Iran into a center for determining the price of saffron, a sustainability achievement other than a relative increase in prices, which was a significant part due to the increase of the exchange rate with the rial, did not come about and the best opportunity to convert The Iranian stock exchange turned to the World Center to determine the price of saffron according to the amount of production.

Experienced unsuccessful delivery of cumin to stock exchange

In 1993, 7 years after the merger of the stock exchange in the Commodity Exchange, once again the test of the arrival of agricultural products that were available on the stock exchange came out of Mashhad, and this time the lottery was called the cumin in the form of a future contract. Cumin is a product of export, which our country is also among its main producers. The traditional stock exchange with the age of 70 years since World War II has been operating in Mashhad and Sabzevar. An inventory bills This product is so valuable that it has a cash order and can be easily transferred with a backend and sometimes without it. This traditional stock exchange, which does not have office and handbag, operates on a limited, well-known collective with a variety of options. The efforts of the stock exchange company to enter the traders of this traditional stock exchange to the official stock exchange, initially with the participation of some of the market’s activists, unfortunately were not sufficient due to the lack of readiness of the stock exchange mechanisms and lack of expertise.

But now, for about 12 years, it has been licensed to sell saffron in the stock exchange and then stock exchange, and so far the stock exchange has failed to seriously trigger its physical transactions, however, the use of a deposit certificate or an inventory bill that is a common practice in stock exchanges and Corn, wheat, barley and sugar are also on the Iranian stock exchange. All its dimensions can contribute to facilitating and boosting transactions, preventing unnecessary transportation and turning this valuable product into capital goods for effective buyers and sellers of risk. To be located. But whether the designation of a reference warehouse and a deposit certificate without considering other relevant factors could be a reason for the success of the plan.

Implementation of Saffron Deposit Certificates on Non-Matter

But what about the launch of a deposit certificate or a warehouse bill should be noted is not considering its implementing mechanisms; the issue that was repeated in the two previous days of saffron and cumin was not used in the stock market. It seems that its experience has not been used.

1. Saffron is a product of high diversity and a lot of cheating compared to wheat, maize and even meal. This valuable crop is traded through the traditional observation, as well as the examination of color, foreign body, moisture and microbial contamination, and the issuance of standard test papers, while the design of the crate is based on the quality criterion It is tested only in limited form, which means that if a person intends to export or sell the purchased saffron to a global standard, he has to re-test it and spend far more than saffron for Pay the test. Due to the fact that storage and maintenance in this one year plan are expected to change with gradual and natural deterioration and inappropriate storage conditions, there is a potential difference between the buyer and the seller.

2- The warehouse is intended for the delivery of saffron at a single point in Mashhad, while the saffron production center is concentrated in Torbat Heydarieh, Taibad, Cayenne, Kashmar and elsewhere, and since the claim of the design, purchase It is direct from the farmer, which does not provide the right option for small farmers who often sell their small crops in several stages and do not have the ability to pay for travel costs. Moreover, if this plan is to be implemented at the time of harvesting, just imagine that only the maintenance of 10% of the production of 250 to 300 tons requires what space with which special features. In addition, with the accumulation of saffron in a warehouse, there is a collision and collapse of information that should often be made public, especially if the union itself plays a role in saffron trade.

3. The cost of issuing a deposit certificate is also worth paying attention to. According to the published information, the sum of 15 thousand tomans for testing and the same amount for the amount spent on 3 grams of test saffron harvest, 15 thousand tomans for warehousing and about 7 thousand tomans for the rights of the exchange and a total of about 52 thousand tomans from the seller, Conditions that are sold at an affordable price and above the market are understandable.

4. Since the most important mission of the stock exchanges is the discovery of prices based on data such as supply and demand, it is not expected that the significant share of this product will be absorbed in this cycle, and that the market continues to be on the one hand and foreign buyers on the other hand will determine the price. It seems that the stock exchange should wait for price discovery for a long time to be able to hold saffron under the key, while in most agricultural, metallic and petrochemical products these are global markets, which are the first price guide. .

5. One of the structural features of the stock exchanges is the presence of market makers who, like the stock market, will be able to regulate the market in abnormal circumstances. The question is, who are the market makers in this cycle. Earlier, the announcement of the formation of a commodity fund with the mechanism for the issue of commodity bonds was published by the former head of the stock exchange and the current chairman of the Saffron Development Bank, but apparently there is still no news of the activity of the fund that could play the role of a market maker.

6. In this plan, the vacancy of export unions, producers, and sellers who have the main volume of saffron exchange in a long-standing purchase, supply and export order is empty and does not appear to be consulted and requested to cooperate.

7. The lack of simultaneous implementation of the future contract and the saffron’s incentive in this plan is another barrier to the prosperity of this market because farmers prefer an option that can cover their risks.

8. Unfortunately, the island’s notion of ruling the economy of the country is also high. It seems that the participants of the plan, as well as the lack of coordination with the private sector organizations, have not benefited from the experience of the Saffron National Council. It is worth noting how many years ago this council, in cooperation with government agencies, including the Agricultural Jihad in several regions, has been launching a Saffron Recognition Plan by encouraging saffroners to establish saffron bars. This kind of activity, if extended, can lead to the production of Iran’s pure and quality Iranian saffron with the national brand. In any case, it is hoped that the project executives will be able to maintain and extend the plan by using enough time to harvest saffron until the harvesting season. Otherwise, the bitter experience of the past failures is evident.

source: donya-e-eqtesad /com