In 1985 the government announced its new goal of doubling non-oil exports in 1986. Although the value of non-oil exports increased 70 percent between March and June 1986, this increase shrank to 59 percent by August 1986. Because inflation had reduced the value of non-oil exports, the government abandoned its goal for non-oil exports.

Despite government encouragement, non-oil exports in 1985 accounted for only 10 percent of total exports. Industrial and mineral exports together accounted for 25 percent of the value of non-oil exports in 1985 but only 5 percent in 1986. The export of manufactured goods and cotton also declined appreciably as a result of the war. A further 25 percent of non-oil export income came from carpets and fruit. Carpet exports were the exception to the overall downturn in non-oil exports in 1985. Carpet exports more than tripled from 1985 to 1986, but as carpet output increased, prices on the international market fell.

The other key non-oil export was agricultural produce. Some agricultural exports increased in FY 1986, whereas industrial exports continued to decline. Official figures showed that agricultural exports were up in value 46 percent for the period March-August 1986, as compared with the same period during the preceding fiscal year. This figure is misleading, however, because there was a decline in the ratio of the value of agricultural exports to agricultural imports. In the mid- 1980s, the agricultural sector operated at a subsistence level, growing food primarily to feed the general population and producing for export only the financially lucrative cash crops whose production varied according to seasonal fluctuations in rainfall. A halting though generally upward trend in the production and export of cash crops began just before the Revolution.

Fruit and vegetable exports increased in 1986 as a result of good weather, a big market in the Persian Gulf area for fresh produce, and incentives to grow and market cash crops, whose prices the government did not regulate. Fruit and vegetable exports accounted for 30 percent of the country's non-oil exports in the first half of FY 1987. Previously, fruit had not exceeded 5 percent of total non-oil exports.

Bumper crops of pistachios sold at the international market rate and bumper crops of fruit and vegetables were the only exceptions to a general decline in agricultural production. Production of pistachios was so competitive that the United States Department of Commerce imposed a 318-percent duty on imports of Iranian roasted pistachios in the fall of 1986, causing a decline in exports to the United States.

Through 1986, Iranian caviar exports in the 1980s fluctuated between US$20 million and US$40 million. In 1986 the exports were worth only about US$20 million. That year, Iran sought to recapture the Italian market (estimated at US$900,000 annually) from the Soviet Union. Iran had sold only US$100,000 worth of caviar (about 11 percent of the market) to Italy in 1985.

Data as of December 1987