Iranian Food Spending Shrinks

When incomes drop and family budgets decline, food choices shift toward cheaper but more energy-dense foods. The first items dropped are usually healthier foods—high-quality proteins, whole grains, vegetables and fruit.

A survey of food consumed by Iranian households during the past decade shows a different pattern.

Between the Iranian year 1385 (March 2006-7) and 1394 (March 2015-16), food consumption of Iranians declined by 28%, according to a report by the Central Bank of Iran. In 1394, each household consumed an average of 921 kg of food and beverages compared to 1,294 kg in 1385.

The average Iranian household in 1385 consisted of 4.05 people, which suggests that each member consumed 319 kg of food and beverages. But in 1394, the number of people per household decreased to 3.38 with a consumption of 272 kg. In other words, food consumed by each member of Iranian households fell 14% over the 10-year period.

CBI surveys 13 food items, namely rice, bread, red meat, poultry, fish, milk, yogurt, cheese, eggs, vegetable oil, sugar cubes, sugar and tea, and cigarettes.

Iranian households cut the consumption of sugar first, then fish and cigarettes over the past decade. They reduced their sugar consumption from 19 kg to 10 kg (about 47%), fish from 19 kg to 11 kg (about 42%) and sugar cubes from 30 kg to 18 kg (about 40%).

During the period under review, consumption of milk, red meat and bread also reduced by 39%, 37% and 32% respectively. Rice was the seventh item with significant reduction in consumption from 168 kg to 116 kg per year, followed by vegetable oil with a 21% decline.

These were followed by reduction in the consumption of tea (20%), cheese (15%), yogurt (10%), eggs (2%) and poultry (1%).

The level of household food consumption registered the biggest reduction in 1390 (March 2011-12), when the inflation rate was about 21.5%, economic growth stood at 3% and unemployment rate was 12.3%.  

The smallest reduction in food consumption belonged to 1388 (March 2009-10), when the inflation rate was about 10.8%, economic growth stood at 3% and unemployment rate was 11.3%. A look at the statistics shows that there was a negative correlation between the rate of economic growth and level of reduction in Iranian households’ food consumption over seven years of the decade in review.

A typical Iranian household did not allow their food spending to go beyond one-fourth of their total expenditure. CBI’s calculations show the food spending of households accounted for 25.6% of their total expenditure in 1385 compared to 24.3% in 1394. This is while costs of food and beverages saw a 4.5-fold rise during the period.  

In 1385, average Iranian households spent 18.58 billion rials (about $491) on food and beverages and 14,350 rials (38 cents) for each kilogram of food compared to 83.27 billion rials ($2,202) they spent on food and 90,410 rials ($2.3) for each kilogram in 1394.