March 2020 Highlights of Kazakhstan Agricultural Sector

During the state of emergency in Kazakhstan, several types of food products are prohibited from being exported. This was announced by the Minister of Trade and Integration Bakhyt Sultanov. It is necessary to prevent interruptions in the supply of socially significant goods to the population. “On March 22, during the state of emergency in Kazakhstan, a ban was introduced on the export from the country of several types of socially important goods, including buckwheat, wheat or wheat-rye flour, sugar, potatoes, carrots, turnips, beets, onions, cabbage, sunflower seeds and sunflower oil,” the minister said.

“As the president said, any attempts to speculate will be harshly suppressed. The state will determine the objectively necessary list, according to which it will introduce state regulation of prices for some socially significant goods,” Sultanov added. President Tokayev instructed to approve the objectively necessary list of socially important goods, according to which state price regulation will be carried out, LS reported.

The turn of state bodies towards equipping the agro-industrial complex with Kazakhstanmade equipment made it possible to create adequate conditions for agricultural engineering in the country. According to the report on the implementation of the strategic plan for 2017–2021 for 2019: - funds in the amount of 27 billion tenge were allocated from the budget in 2019 for preferential leasing of buses and agricultural machinery. The delivery of 1,350 units of buses has been funded and 267 units of agricultural machinery were transferred; - 37 agreements on the industrial assembly of agricultural machinery were concluded; - a utilization fee for agricultural machinery and a mechanism for stimulating the production of agricultural machinery were introduced. The recycling fee does not apply to equipment of the brands including CLAAS, Lemken, John Deere, AGCO, Case New Holland, Green Plain, Codaf SRL, Same Deutz Fahru, Scarabelli Export S.R.L., Nettuno, Pedrotti s.p.a., Myrtech, Agrokonsultos Grupe, Bauer, Agro-Matadex, Animals, Farming, Stable Equipment, PRONAR, Yanmar, Kubota, Kverneland, Irrifrance, Sampo Rosenlew LTD, Bourgault. In fact, the collection applies primarily to domestic equipment and importers from the CIS.

Since 2018, a leasing financing program for updating agricultural equipment from the Development Bank of Kazakhstan has been operating in Kazakhstan. In 2019 alone, DBKLeasing financed the purchase of more than 270 units of domestic-made tractors and combines by Kazakhstani farms. In addition to DBK-Leasing programs, leasing programs of KazAgroFinance also work. The company claims to occupy 90% of the country’s agricultural leasing market. KazAgroFinance, unlike DBK-Leasing, finances the purchase of equipment not only of Kazakhstan production, and the company’s direct contribution to Kazakhstan engineering is not specified. The efforts of the state have an obvious effect. In the segment of agricultural machinery for the first month of this year, the country’s factories produced 74 tractors, against 67 a year earlier, and 50 machines for preparing and cultivating the soil, against 43 a year earlier. In 2019, jump-like growth was noted in all categories. 897 tractors were produced, more than in the previous two years combined. The output in the sector after two years of stagnation is approaching pre-crisis values.

Soil preparation

The production of equipment for soil preparation and cultivation also increased by 14.6%, to 956 machines. 512 headers and 381 combines were produced. Tractor production is concentrated mainly in East Kazakhstan and Kostanay regions. Large plants such as the SemAZ PalAZ Automobile Assembly Plant SemAZ, Agromashholding work in Kostanay. Agricultural machines used for soil preparation or cultivation are assembled mainly in North Kazakhstan, Kostanay and Akmola regions. The Kokshetau combine plant Vector, localising the production of Rostselmash combines, the Petropavlovsk Agroremmash, the Petropavlovsk Tractor Plant and many others work here. In monetary terms, in January 2020, production in the field of engineering in Kazakhstan as a whole reached 92.98 billion tenge, which exceeded last year’s figures by more than 20%. This is 11.2% of the total production volume of the processing segment in monetary terms, and 4% of the total industrial production in the country.

The main production volumes in the mechanical engineering segment are concentrated in the production of vehicles, machinery for the agro-industrial complex and the mining industry, and other similar special equipment. However, it will be necessary to make a lot of efforts to develop the agricultural machinery manufacturing industry. Despite the growth and optimistic beginning of the current year, last year Kazakhstani companies covered only 12.8% of demand, that is, more than 87% of the market was left to importers, according to Energyprom.

Kazakhstan further develops sugar industry

The Minister of Agriculture, Saparkhan Omarov, reported on the level of production and the supply of sugar and apples to the domestic market. The sugar industry is growing. The number of sugar beets increased from 345,000 tons to 486,000 tons, with an increase in yield from 285 to 325 quintals per hectare. Sugar self-sufficiency in recent years has doubled, from 7% to 14%. In January of this year, Kazakhstan imported more than 40,000 tons of sugar from Russia. Further development of sugar beet production will occur due to the expansion of sown areas, including in the northern regions of the country, and the restoration of additional irrigated land. In addition, it is planned to modernize existing factories and commission two sugar plants, which are located in Pavlodar and Zhambyl regions. New factories will be able to produce up to 216,000 tons of sugar annually, Kazakh Zerno reported.

In January and February, the number of chickens in Kazakhstan decreased. In different regions, the dynamics had a different orientation. In five regions, the number has increased, but in nine of them the number has decreased, which yields a general negative result. By the beginning of 2020, there were 45,197.1 thousand chickens in Kazakhstan and in January to February 1, it had decreased to 45,015 thousand, by 182.1 thousand or 0.4%. By March 1, the number had decreased and reached the level of 44,583.9 thousand with a decrease by 431.1 thousand or 1%. As a result, over two months the number of chickens in the republic decreased by 613.2 thousand or by 1.4%. The most significant decrease was recorded in three regions. This is Akmola region by 393.1 thousand chickens, from 8,078.9 to 7,685.8 thousand goals, Karaganda region by 305.1 thousand, from 4,008.8 to 3,703.7 thousand, and North Kazakhstan region by 125.8 thousand, from 4,614.4 to 4,488.6 thousand. An increase in Kostanay region amounted to 420.3 thousand chickens, from 4,266.8 to 4,687.1 thousand, and in East Kazakhstan region to 158.1 thousand, from 3,875 to 4,033.1 thousand. The largest poultry region in Kazakhstan is Almaty region. As of March 1, 10,334.8 thousand chickens were kept there. The next five largest livestock are in Akmola region at 7,685.8 thousand, Kostanay region at 4,687.1 thousand, North Kazakhstan region at 4,488.6 thousand, East Kazakhstan region at 4,033.1 thousand, and Karaganda region at 3703.7 thousand, Kazakh Zerno reported.

Rose is still the most popular flower in Kazakhstan. In 2019, 73.5 million units were imported into the country, and their cost amounted to $29.2 million. The main deliveries were from Ecuador at 55.8 million units for $23 million, Kenya at 7.3 million units for $1.8 million, Colombia at 6.8 million units for $2.9 million, and the Netherlands at 2.9 million pieces for $1.2 million. On the second place are tulips, which are the traditional gift of the upcoming holiday. During the year Kazakhstan received 16 million bulbs for $1.5 million. The main supplier of these flowers is the Netherlands at 15.5 million pieces for $1.5 million. Poland brought to the country 500 thousand bulbs for $57 thousand. On the third place are chrysanthemums at $5.1 million for 11.9 million pieces. Almost all were imported from the Netherlands at 11.8 million units for $5 million. In 2019, imports of carnations amounted to 6.3 million pieces for $1.1 million, lilies to 1.4 million pieces for $630.2 thousand, hyacinths and daffodils to 343.9 thousand pieces for $1.1 million, and orchids to 230.5 thousand units for $199.2 thousand, according to LS.

Market of processed and canned fish and seafood in Kazakhstan

In January 2020, Kazakhstan processed and packed fish, crustaceans and mollusks worth1.4 billion tenge, according to the information of the Constitutional Court of the Ministry of National Economy of Kazakhstan. Growth including inflation amounted to 2.1%. In January last year, the indicator was equal to 1.5 billion tenge. In January-December 2019, the output in the processing and canning sector of fish, crustaceans, and mollusks amounted to 20 billion tenge, which meant a decrease in production by 2.7%. For comparison, in January-December 2018, the amount of production reached 23.1 billion tenge, with production growth by 8.3%. The total market for fish products in Kazakhstan is about 66 thousand tons, of which 45 thousand tons are fishery and 7.4 thousand tons are fish. 30 thousand tons are exported, 43.5 thousand tons of products are imported. In the medium term, there is the potential to increase the volume of the domestic market to 120 thousand tons, which will reduce imports thanks to the cultivation of trout and Atlantic salmon, while increasing export volumes to world markets. Commercial fishing in Kazakhstan is carried out by more than 1 thousand subjects of fisheries, for which 1,646 fishery reservoirs and their sections are assigned. The industry employs 11 thousand people. Fishing is carried out mainly in the Caspian and Aral seas, in the lakes of Balkhash and Zaysan, in the Bukhtarma, Kapshagai and Shardara reservoirs, in the Alakol system of lakes, in the rivers Zhayik and Kigash. The main fishing regions are Atyrau region at 13.1 thousand tons, 29.2% of the total, East Kazakhstan region at 8.2 thousand tons, 18.3%, Kyzylorda region at 7.4 thousand tons, 16, 4%, Almaty region at 6.6 thousand tons, 14.6%, Mangistau region at 2.3 thousand tons, 5.2%, and Turkestan region at 2 thousand tons, 4.5%. Fish farming is dynamically developing in Kazakhstan. Over the past 7 years, the volume of fish grown has increased 9 times, from 800 tons to more than 7 thousand tons. 180 fish farms are engaged in fish farming in the country, where more than 1 thousand people are employed. In January 2020, Kazakhstani companies produced 1.7 thousand tons of fresh, chilled or frozen fish, 19.2% more than in January 2019; the production of fish, caviar and its substitutes prepared or preserved in another way amounted to 666 tons, a decline in production by 4.6% was noted. The main producers of fish, caviar and its substitutes, prepared or otherwise preserved, are the West Kazakhstan region at 274 tons, Turkestan region at 193 tons, and East Kazakhstan region at 51 tons. 518 tons of fish were produced in these regions, which is 77.8% of the total production. The Kazakhstani fishing industry could not fully meet the demand for processed fish, crustaceans and mollusks. In January-December 2019, needs were covered by local production by 45.3%. Retail prices vary significantly by region. On average, cold smoked mackerel in February this year cost 2,091 tenge per kg, salted herring cost 915.76 tenge per kg, sprats in oil at 509.3 tenge per 240 g. Mackerel and sprats were the cheapest in Kyzylorda, the cheapest herring is in Pavlodar. Most of all, mackerel and sprats cost residents of Taldykorgan, and salted herring for residents of the capital. Prime Minister Askar Mamin noted the need for systematic measures for the development of the country's fisheries and instructed to prepare a draft Concept for the development of fisheries of Kazakhstan by April 1. “To consider the lifting of the ban on fish farms to operate in water protection zones of rivers, as well as to reduce fees for fish using water resources, providing only payment for actual water costs. To improve the mechanism of payment for the use of fish resources, including lowering payment rates,” Mamin said, according to Energyprom.

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