About 10% of the land in Iran is arable; agriculture contributes just over 11% to the GDP and employs a third of the labor force. The main food-producing areas are in the Caspian region and in the valleys of the northwest. Wheat, the most important crop, is grown mainly in the west and northwest; rice is the major crop in the Caspian region. Barley, corn, sugar beets, fruits (including citrus), nuts, cotton, dates, tea, hemp, and tobacco are also grown, and livestock is raised. Illicit cultivation of the opium poppy is fairly common.
The principal obstacles to agricultural production are primitive farming methods, overworked and underfertilized soil, poor seed, and scarcity of water. About one third of the cultivated land is irrigated; the construction of multipurpose dams and reservoirs along the rivers in the Zagros and Elburz mts. has increased the amount of water available for irrigation. Agricultural programs of modernization, mechanization, and crop and livestock improvement, and programs for the redistribution of land are increasing agricultural production.
The northern slopes of the Elburz Mts. are heavily wooded, and forestry products are economically important; the cutting of trees is rigidly controlled by the government, which also has a reforestation program. In the rivers entering the Caspian Sea are salmon, carp, trout, and pike; the prized sturgeon (and caviar) of the Caspian Sea have been hurt by pollution and overfishing.
Of the variety of natural resources found in Iran, petroleum (discovered in 1908 in Khuzestan province) and natural gas are by far the most important; oil accounts for 80% of export revenues. The chief oil fields are found in the central and southwestern parts of the Zagros Mts. in W Iran. Oil also is found in N Iran and in the offshore waters of the Persian Gulf. Major refineries are located at Abadan (site of the country's first refinery, built 1913), Kermanshah, and Tehran. Pipelines move oil from the fields to the refineries and to such exporting ports as Abadan, Bandar-e Mashur, and Khark Island. Domestic oil and gas, along with hydroelectric power facilities, provide the country with power.
Textiles are the second most important industrial product; Tehran and Esfahan are the chief textile-producing centers. Other major industries are sugar refining, food processing, and the production of petrochemicals, cement and other building materials, and machinery. Iron and steel and fertilizer are also produced. Traditional handicrafts such as carpet weaving and the manufacture of ceramics, silk, and jewelry are important to the economy as well.
Besides crude and refined petroleum, Iran's chief exports are chemical and petrochemical products, fruits, nuts, carpets, hides, and iron and steel; its chief imports are industrial raw materials, capital goods, foodstuffs, consumer goods, technical services, and military supplies. Iran's chief trading partners are China, Japan, Germany, Italy, and South Korea. Khorramshahr, on the Shatt al Arab, is the country's chief general cargo port; Bandar-e Anzali is the chief Caspian port.