The Islamic State has repeatedly made headlines for commandeering and profiting from the region’s oil. Less attention has been paid to its use of another resource vital to the functioning of any would-be state: agriculture. The Islamic State does not publish agricultural statistics. So how can we measure its agricultural production and potential revenue streams? How has the international campaign against the Islamic State impacted that vital economic sector?
In a recent article, we use an innovative method of interpreting satellite imagery to gauge agricultural production in Islamic State-controlled territory. We derive remotely sensed vegetation indices and correlate them with production in pre-conflict years based on government statistics. To isolate the impact of conflict from drought effects, we statistically control for rainfall. The results are striking: The Islamic State may be using and profiting from agriculture far more than previously estimated.
How the Islamic State took over and controlled agriculture
In 2013 and 2014, the Islamic State overran large parts of the Gezirah region in Syria and Ninewa province in Iraq, two main breadbaskets. Farmers were displaced, supplies of subsidized inputs were disrupted and government-supported grain procurement broke down. However, the Islamic State didn’t just cut and burn. As it did with oil refineries, the Islamic State considered food-related infrastructure — such as silos — a strategic asset and sought to take it over intact. Agriculture represented a path to secure food provision and a source of recurrent tax income. As other sources of extractive revenue such as oil, ransom and confiscations have dwindled, and with foreign donations presumably lower than in 2013 to 2014, agriculture income has become increasingly important.
Unsurprisingly, conflict has taken a toll on agriculture, especially irrigated summer crops, such as cotton in northeastern Syria and fruit, vegetables and cotton in the Orontes basin in western Syria. For rain-fed winter crops, the impact was less pronounced but is still notable when looking at the sharp vegetation divide between war-torn Syria and much greener Turkey (see map). Green areas indicate productivity above pre-conflict mean and red areas below it. The red line of the map shows the territory that the Islamic State held over much of 2015. Despite normal rainfalls in 2012, conflict-related impact is clearly discernible, followed by a recovery in 2013. In 2014, drought had a negative impact on harvests, especially in the Aleppo governorate, but in 2015 farmers were able to capitalize on improved rainfalls, particularly in Iraq, where productivity was mostly above pre-conflict mean in 2013 to 2015, in Islamic State and non-Islamic State territories alike.
Exactly how much has the Islamic State raised through agriculture?
Conflict impact notwithstanding, rain-fed wheat and barley production in Islamic State territory has suffered much less than we initially expected before starting our research. The income the Islamic State has derived from this production is likely substantial. The Islamic State raises a zakat tax of 5 percent and 10 percent on irrigated and rain-fed crops, respectively. Crop prices roughly equal world market levels, as the Islamic State does not maintain a system of subsidized consumer and producer prices like the Iraqi government. We estimate that in 2015 the group might have derived up to $56 million from wheat and barley taxation alone. In addition, the group taxes other crops, livestock and the processing and distribution chains. This is especially notable when compared with a total annualized revenue estimate by U.S. officials of $1 billion, half of which came from oil until spring 2015 but is now greatly reduced.
The total value of an estimated 2.45 million tons of wheat production in Islamic State territory in 2015 roughly equaled the annualized value of Islamic State oil production during its height in late 2014 and early 2015.
What about surplus?
Iraq and Syria were wheat net-importers before the conflict; the Islamic State is not. Because it has maintained production while the population in its territory has declined, it likely produces an exportable surplus. We estimate the prewar population in Islamic State territory with the help of WorldPop statistics that combine census data with analysis of satellite imagery and deduct estimated flows of refugees and internally displaced people. In 2015, the population in Islamic State territory likely did not exceed 4 million people, much lower than estimates of 8 million and more that have been reported in the media. This would translate into domestic consumption of 0.85 million tons of wheat and an exportable surplus of 1.6 million tons.
Where this surplus actually goes is a politically sensitive question. Transaction costs have soared, and transport routes to traditional markets in the west of Syria have been disrupted. Yet the Islamic State still trades oil and gas to other rebel groups and the Syrian government. The same might apply for wheat. Neighboring countries are a destination of an unregulated livestock trade from all over Syria. Again, the same might apply for wheat. There is an economic incentive to smuggle wheat into the subsidized Iraqi distribution system and to Turkey, where prices are higher, according to the U.N. Food and Agriculture Organization and the World Food Program.
The Islamic State economy is not sustainable in the long run. Agriculture in its territory lives on bought time as supply chains of agricultural input factors like quality seeds and fertilizers have been disrupted. But in the meantime, more research could continue to illuminate exactly how combatants destroy, rebuild, tax and profit from agriculture during times of war.
Eckart Woertz is a senior research fellow at the Barcelona Centre for International Affairs (CIDOB) and a scientific adviser to the Kuwait Chair at Sciences Po, Paris. He is on Twitter @eckartwoertz
Hadi Jaafar is an assistant professor at the American University of Beirut. He is on Twitter @HadiHJaafar