At least 40 merchant ships carrying grains and sugar are stranded off the coast of Iran due to delays in payments that have been ongoing for weeks, according to shipping data reviewed by Reuters.

Ship tracking data shows that the carrier ships are currently stuck outside the major Iranian ports of Bandar Imam Khomeini and Bandar Abbas.

The Iranian Ports and Maritime Organization said in late November that 37 ships loaded with 2.2 million tons of goods had not been able to unload their cargo due to “documentation and hard currency payment issues.”

One western trade source quoted by Reuters estimated that the cargoes stuck outside Iran are worth more than $1 billion, with charterers facing delay costs known as demurrage.

While western sanctions on Iran allegedly exempt food and medicine purchases, the weight of the punitive measures on the country’s financial system greatly restricts payment methods, forcing authorities to rely on complex and erratic arrangements with international companies.

Iran counts among the driest countries in the world, with an average rainfall of only 250mm a year. Despite its nearly 165 million hectares of land, only about 50 million is arable, with just 18 million hectares used for farming.

According to data compiled by the US Department of Agriculture, due to severe droughts, Iran is expected to import 5.5 million tons of wheat during the 2022/23 season, down from 8.0 million during the previous season, but still well above normal levels.

Iranian authorities have, in recent years, prioritized boosting food security in the country to confront western sanctions.

In September, Venezuela offered millions of hectares of agricultural land to Iranian producers. Other reports indicated that Russia had also offered 100,000 hectares of land – an attestation to how Tehran has been pursuing its plans of trans-territorial farming in various countries.

The idea of trans-territorial farming surfaced in Iran over two decades ago. However, it was not until 2016 that officials started implementing measures to achieve this as part of their strategy to secure food supplies for the country.

Tehran, which between 2004 and 2017 celebrated its self-sufficiency in strategic products like wheat, and even exported part of its wheat surplus in 2017, now needs to import grains to make up for shortfalls in production.