The Financial Times reported that Iran’s handmade carpet industry is facing an unprecedented collapse, with exports falling to their lowest level due to U.S. sanctions and the Iranian regime’s currency regulations.
The Financial Times wrote on Friday, December 26, that Iranian carpets, renowned for their artistic delicacy and the skill of their weavers and with a production history spanning thousands of years, are now produced in far smaller quantities than in past decades, and Iran has lost a large part of its former position in the global carpet market.
Quoting figures active in Iran’s carpet industry, the newspaper added that regional instability has also contributed to the collapse of this industry, and the current situation has dealt serious damage to local businesses.
Iran’s Carpets Industry on the Decline as Economy Continues to Spiral Down
An Iranian carpet weaver said in this regard that the cost of producing carpets is very high, while the resulting profit is negligible.
According to him, preparing the wool and silk for one carpet costs about 250 dollars, and then nearly one year is spent weaving it. Even if the carpet turns out completely flawless, its sale price is usually around 600 dollars.
The lack of government support and social security coverage has pushed him to the brink of exhaustion: “I work with constant back and leg pain, but I cannot afford to hire an assistant weaver.”
According to statistics from the Carpet and Handicrafts Commission of Iran’s Chamber of Commerce, the value of carpet exports in the year ending in March 2026 will fall to less than 40 million dollars, compared to 41.7 million dollars the previous year.
Morteza Haji Aghamiri, chair of commission, said export figures had been below $100mn — “so meagre we can say it is practically zero” — for six years running, down from a peak of more than $2bn three decades ago.
This is while Iran’s carpet exports reached more than two billion dollars about three decades ago.
In October, Agence France-Presse, referring to the critical condition of Iran’s carpet market, reported that carpet exports from Iran have faced a 95% decline.
The loss of Iran’s traditional carpet markets
While Iranian carpets were previously exported to about 80 countries, today their target markets have been limited to the United Arab Emirates, Germany, Japan, the United Kingdom, and Pakistan.
At the same time as many of Iran’s traditional markets have been lost, competitors from Turkey, India, China, and Afghanistan have filled this gap.
Before the latest round of sanctions, Western tourists were the main buyers of fine Iranian carpets, but escalating political tensions with the West reduced foreign tourism and constrained the retail market.
Disruptions in the region’s airspace following the war with Israel, along with other political tensions, caused foreign traders to lose confidence.
An activist in the carpet sales sector said: “Even the Tehran carpet exhibition, held every September — which allowed us to maintain minimal contact with foreign buyers — was cancelled this year, apparently because of electricity shortages.”
The Financial Times went on to write that sanctions and the severing of trade relations have eliminated Iran’s opportunity to keep pace with new market tastes and the trend toward minimalist interior design, a trend that is often incompatible with traditional Iranian carpet designs.
In addition, inflation and the decline in citizens’ purchasing power have led to a drop in domestic demand, and Iranian carpets have effectively lost their place in many people’s homes.
According to experts in this field, currently less than three percent of produced carpets are used inside the country.
