“Holding “KazAgro” is implementing lending of spring field work due to budget loan of 80 billion tenge. Total for all programs is planned to allocate for financing 95.8 billion tenge”, the Minister of Agriculture informed.
Last year, “KazAgro”, within the budget loan and the forward purchase of grain for public resources, for financing of sowing campaign was allocated 78 billion tenge.
The state represented by the Ministry of Agriculture and KazAgro increases the amount of credit, forcing more farmers into debt. These officials do not care that more than half of the last year’s crop has not yet been distributed yet, and farmers will once again be “in bondage”.
It is easier to give money for growth than do the actual enrichment of local farmers. Even more, they do not want to share with them the problems of agricultural and industrial complex, because agriculture – is their almost private business. At least they think so.
Do not bother us, please! Why do you interrupt us? We do not touch anyone. Mind your own business; write about growth of livestock and crop yields, we will draw your a lot of numbers. Just do not ask difficult and uncomfortable questions, they hinder the smooth flow of public thought about the strategic development of agricultural and industrial sector.
Here is an opinion that inevitably develops after the fact that having received an invitation for an agricultural briefing, journalists of the agency “Kazakh-Zerno” were not allowed to take part in it.
And why to let them in? They will spoil the event with its naive questions. And without them it is somehow safer. Everyone will ask the right questions, the officials will give the right answers, and everything will be “hip-hop”.
However, the issues remain, despite the fact that the officials do not want to listen them. And the problems remain too. You can make a fool of one person for a long time, you can fool a lot of people a long time, but you cannot fool all people for a long time.
Now let’s move on to more serious matters. About the latest developments in the grain market in Kazakhstan see below.
Kazakhstan, having unlimited opportunities to export processed grain, is exporting it as raw material, paying lot of money. Nonsense? The republic with its huge grain potential can produce from grain the entire product line of processed grain products.
It’s not just flour, for export of which Kazakhstan is already ahead of the rest of the planet. This is high protein feed; this is starch, gluten; this is such a product of deep processing as ascorbic acid, which Kazakhstan and neighboring states need so much.
According to the President of the Union of Grain Processors and Bakers of Kazakhstan Yevgeniy Ghan, two tons of flour from the three produced in Kazakhstan, are sold for export. There is not such figure in any other country of the world – 25% of world flour exports now goes from Kazakhstan. “We export 330 thousand tons of flour per month, Russia is selling such amount for a year”, he explained.
And what if Kazakhstan will go further? For example, now the CIS imports ascorbic acid from China. Why Kazakhstan is worse? In the neighboring Altai region people have already begun this and, most likely, Kazakhstan will once again be an outsider. With such a low potential for the export of grain, which Kazakhstan has, God himself commanded to do the processing. It’s hundreds and thousands of jobs; it is an incentive for agricultural science; a new value-added in the Kazakh treasury and the purses of the citizens of Kazakhstan.
No, we will simply export raw golden grain, spending a lot of money for this. If even a fraction of these funds would be sent for processing, a positive result will not made to wait for it. But commodity barons do not want it. They feel good this way. Compradors do not need to develop the country; they are more interested in the contents of their wallets.
Grain forum «Kazgrain-2012″ identified the points of development of the industry; it remains only to find the point of its growth. Until now, the materials of this forum remain a subject of debate for representatives of domestic and foreign agricultural business, experts and observers. All that was said and shown in the forum, all the analysts’ forecasts and assumptions and, finally, all that was said by officials from the agrarian and industrial complex will have a direct bearing and influence on the events in the short and medium period.
After much consideration, Kazakhstan eventually chose the main strategic direction of its grain exports. It was Iran. The National Grain Company of Kazakhstan “Prodcorporation” rented the land for the construction of grain elevator in Iran, said the President of Grain Union of Kazakhstan Nurlan Tleubayev.
According to him, in the same way “Prodcorporation” has built a grain terminal with the Iranian company in the Iranian port of Amirabad.
“Kazakhstanian grain will be supplied by railway wagons to the new elevator. After discharge it will be taken away by cars inland to the other elevators, including those located on the Persian Gulf”, Tleubayev said.
The head of the Grain Union of Kazakhstan noted that Iran is ready to receive 200,000 tons of Kazakhstanian grain per month, but for today the republic may deliver only 50-65 thousand tons of grain per month (Port Amirabad).
“Iran is a lucrative market for Kazakhstan. Here, the value of our grain is not below $200 per ton, while in the ports of the Black Sea it is only $140 per ton”, he said.
According to the head of the Grain Union of Kazakhstan, the republic in the 2011-2012 marketing year will be able to export 13 million tons of grain.
These are only plans. How much is exported in the current marketing year in reality? The exact figures were reported by Anna Buts, the director of Arable Farming Department of the Ministry of Agriculture. Kazakhstan exported 7.8 million tons of grain this marketing year, she said.
Despite the decline in grain and flour prices, according to the Customs Committee of RK, Kazakhstan took out just over 672 thousand tons of grain in March. Most crops were for Uzbekistan, Azerbaijan and Tajikistan.
The Islamic Republic of Iran this month was on the 4th place.
We remind, in 2011 the Republic harvested record 27 million tons of grain in net weight. Kazakhstan plans to export 15 million tons of grain in the 2011-2012 marketing year.
April is in the yard, gentlemen. Till the end of the year remained some three months, and it is taken out less than one-third of the wheat from the initial stocks. Let us rejoice or grieve?
The old crop is not distributed even for a half, and it is time to prepare for new planting. This year, only farmers are happy because of prolonged spring, especially for those whose grain has left in the fields. And there are a lot of such farmers. Relatively cool weather is still holding back spoilage and rotting of the grain. And it is well known to everyone what will happen when the sun begins to strike down actively.
But the local agriculturists are itching. They are already in a panic. The planting season will be conducted in difficult conditions in the current year due to lack of available moisture reserves, predicted the scientists.
According to specialists of JSC “Kazagroinnovation”, the situation caused by the fact that throughout the remainder of productive moisture reserves after harvest and the autumn rains were few, especially in Akmola, Karaganda, Pavlodar and Kostanai regions.
“There has been little snow this year and the winter can be described as with little snow. This is especially characteristic for Akmola and Pavlodar regions. At the same time the snow was incoherent, its height was at the level of stubble. Supplies of water and snow this year are only 25-35 mm, which is a pretty low rate”, the USDA report says.
And it is bad for Kazakhstan in terms of excessive grain balance? Imagine if it was vice versa. In 2012, Kazakhstan will harvest one more record crop, and … This can be imagined only in a bad dream.
A lot of wheat left in the farms. As of March 1, according to statistics data, in peasant farms were 2,012,694 tons. For comparison, last year at this same period there was 997,945 tons. Even more of it is in agricultural enterprises – 5,391,332 tons. Last year – 2,545,067 tons. At the same time this year the elevators were jammed “to the rafters” – 9,161,556 tons. Last year at the elevators there were 3,592,242 tons.
Of course, stocks declined in March. How many, still there is no data. But last year in March, they dropped slightly by 182,000 tons at agricultural enterprises, by 114,468 tons in the farms and by 230,225 tons at grain elevators. As a result, for about 524.7 thousand tons in March for all purposes, without exception, including exports. We ask, what should happen this March, to increase the distribution of the grain many times?
What should be done to reduce inventories and more or less at leas release the elevator power for the new crop. Maybe to feed the animals for the future? But the animals are not people; they will not eat if they do not want. Let’s see what statistics will tell us in April. It is possible we will witness the new wonderful disappearance of huge quantities of grain from the national balance sheet, as it was in January.
We remind, in December the amount of grain in Kazakhstan decreased by 3367720 tonnes, or 14% by December 1, 2011. This is 2.6 times bigger than average decline per month. So where did this grain go in December? The answer is obvious. As well as in statistical tables, it has disappeared, but rather, was written off for the ineptness from the balance of agricultural enterprises of the republic. About 2 million tons! Let’s see what will happen next.
Since April 1, KTZ increased prices for freight transportation by 15%. This was announced by the Head of loading and unloading department, Mr. Bocharov.
Kazakhstan’s national railway company “Kazakhstan Temir Zholy” (KTZ) planned to raise tariffs for transportation of cargo even in 2011 by 15%, but increased them only, on April, 1. “According to preliminary data from regional departments of agriculture, in 2012 it is planned to sow the area of 21.2 million hectares. It is equal to 2011 level. The area of spring sowing will be 18.5 million hectares; grain crops will be planted on 16.3 million hectares. At the expense of wheat acreage cut to 13.5 million hectares, it is expected to increase the area of feed crops “, – informed A. Mamytbekov.
According to him, it is connected with the implementation of the program for the development of livestock, as well as increased demand for feed crops.
According to the Head of the Ministry of Agriculture, the country is not facing the shortage of seeds for the current spring sowing campaign.
Reduced-price amounts of fuel in the spring field work began to arrive to farmers, the minister said.
“According to availability of farm machinery: for today it is at the level of last year; this year the planting will be attended by approximately 2700 units of high-performance farm machinery. It will allow to sow half of the planned area of grain crops in optimum agronomical terms,” – the Minister of Agriculture said. This year will be saved last year’s subsidy mechanism as well as mechanism of acquisition of fertilizers and herbicides by agricultural producers.
According to Mamytbekov, now banks are showing activity. Along with them, holding “KazAgro” is implementing lending of spring field work due to budget loan of 80 billion tenge.
“In addition, the program of microfinance will be implemented, as well as funding through village credit associations, the rural consumer cooperatives. Total for all programs is planned to finance the 95.8 billion tenge, “- informed the Minister.
Now compare these figures, which will be given to farmers for the growth, with the figure, which is allocated for the purchase of grain cars. Handing out slice paper in debt at interest is much more profitable than building infrastructure for development of the industry.
In the market of cash sales of grain and flour for the period from March, 16 to April, 6, prices of wheat in Kazakhstan decreased for about 700 – 8100 tenge per ton in the different regions of the country.
The fall of dollar to tenge has made wheat prices decline less noticeable in overseas markets. Barley for the same period fell for 500 – 700 tenge per ton. Prices for flour have fallen in regions, depending on variety and district of distribution from 200 to 8,000 tenge per ton.
Currently, you can buy wheat of 3 class from new harvest in Astana for 24,230 tenge ($163.7) per ton. It is 800 tenge higher than in the end of January. First-rate flour in the capital of our country costs 40,800 tenge per ton – the decrease was for 200 tenge ($275.6). Second-rate flour is sold by 36,900 tenge ($249.3) per ton, and flour of extra class – by 43,900 tenge ($296.5) per ton.
As of April 2, a ton of wheat of 3 class can be purchased for 23,530 tenge ($ 158.9), wheat with gluten content above 27 percent – for 26,430 tenge per ton ($ 178.5), barley of a 2 class now costs 22,630 tenge per ton ($ 152.9) in Akmola region. Flour of extra class costs 43,500 tenge ($ 293.8), first- and second-rate flour is offered at 40,000 tenge ($271) and 36,800 tenge per ton ($ 248.6), respectively.
In the North Kazakhstan region wheat of 3 class is sold by 22,830 tenge per ton, – decrease for 700 tenge ($ 154.2), wheat with gluten content above 27 percent – by 25,100 tenge ($169.5). The current price of barley is 22,100 tenge per ton ($149.3). The prices on the flour market went down too. In the North Kazakhstan the price of flour of extra class is 42,100 tenge ($284.4) per ton, first-rate flour costs 38,800 tenge ($262.1) and second-rate flour costs 35,500 tenge per ton ($239.8).
In Kostanai region the price of wheat of 3 class over the past 3 weeks has risen to the level of 23,030 tenge per ton ($ 155.6). Wheat with gluten content above 27 percent is sold by 25,830 tenge ($174.5). The price of barley of 2 class is 21,800 tenge ($147.3) per ton. The market price of flour of all classes also went down. The average price of flour of extra class is 42,300 tenge ($285.7) a ton, first-rate flour costs 39,500 tenge ($ 266.8) a ton, second-rate flour costs 35,900 tenge ($242.5) a ton.
In Pavlodar region the price of wheat of 3 class is 24,100 tenge per ton, or $ 162,8 per ton. The price of barley is 24,000 tenge ($ 162.1) per ton. Flour of extra class costs 44,400 tenge ($299.9) per ton, first-rate flour costs 40,600 tenge ($274.3) per ton, second-rate flour costs 38,000 tenge ($ 274.3) per ton.
In Karaganda region wheat of 3 class costs 25,630 tenge ($173.1) per ton, wheat with gluten content above 27 percent costs 26,930 tenge ($181.9) per ton. The price of barley is 23,700 tenge ($160) per ton. In Karaganda, traders sell flour of all rates at the following prices: first-rate – 41,000 tenge ($276.9) per ton, second-rate – 37,800 tenge ($ 255.3) per ton and extra class – 44,000 tenge ($297.2) per ton.
Over the past period the cost of wheat in the East and West Kazakhstan went down. The price of wheat of 3 class in EKR is 24,130 tenge ($163) per ton, barley- 22,830 tenge ($154.2) per ton. In the West region of the country the price of wheat of 3 class fixed at 25,230 tenge ($170.4) per ton. The cost of first-rate flour in East Kazakhstan is 40,300 tenge ($272.2) per ton, second-rate flour costs 37,400 tenge ($252.6) per ton, and flour of extra class – 44,000 tenge ($297.2) per ton. In the West Kazakhstan prices for flour are the following: first-rate – 41,300 tenge ($279) per ton, second-rate – 38,400 tenge ($259,4) and extra class – 43,900 tenge ($296.5) per ton.
In Almaty region the price of wheat of 3 class for today is offered by 25,530 tenge ($174.5) per ton, barley of 2 class is sold by 23,500 tenge ($158.7) per ton. The cost of flour of extra class in this region is 44,700 tenge ($301.9) per ton, first-rate – 41,900 tenge ($283) per ton, second-rate – 38,500 tenge ($260) per ton.
In Zhambyl region the price of wheat of 3 class for today costs 25,430 tenge ($171.8) per ton, barley of 2 class is sold by 24,100 tenge ($162.8) per ton. The cost of flour of extra class in this region is 44,300 tenge ($299.2) per ton, first-rate – 40,500 tenge ($273.6) per ton, second-rate – 38,600 tenge ($260.7) per ton.
In the South Kazakhstan region wheat of 3 class is offered by 25,800 tenge ($174.2) per ton, barley – by 22,600 tenge ($152.6) per ton. The cost of flour of extra class in this region is 44,800 tenge ($302.6) per ton, first-rate – 42,500 tenge ($287) per ton, second-rate – 38,800 tenge ($262) per ton.
In Aktobe region flour of extra class can be purchased for 45,300 tenge ($306) per ton, first-rate – 42,100 tenge ($284.4) per ton, second-rate – 39,100 tenge ($264.1) per ton.
In Kyzylorda region wheat of 3 class is sold currently at 25,330 tenge ($171.1) per ton. The cost of flour of extra class is 47,000 tenge ($317.5) per ton, first-rate – 43,500 tenge ($293.8) per ton and second-rate – 41,000 tenge ($277) per ton.
In the south capital, Almaty, you can buy wheat of 3 class by 25,900 tenge ($175) per ton. Flour of extra class costs in Almaty 46,200 tenge ($312) per ton, first-rate – 44,000 tenge ($300.6), and second-rate – 40,500 tenge ($273.6) per ton.
The dynamics of grain and flour prices on export boundaries of the republic is stable. Wheat in the export boundaries almost hasn’t changed, barley and flour stayed at the same level.
Prices of Kazakhstan wheat, barley and flour on the export the borders of the Republic were formed as follows:
The cost of wheat of 3 class with gluten content of 23 percent on DAP terms at the station Lugovaya (Kazakhstan – Kyrgyzstan) is $200 per ton, with gluten content of 27-30 percent – $215 per ton. Barley costs $174 per ton. Flour of extra class is sold by $358, the cost of first-rate flour is $328 and the second-rate -$304 per ton.
At the elevators of the South Ural railway the current cost of wheat of 3 class is $ 175 a ton, wheat with gluten content above 27 percent – $194. The price of barley there is $149 per ton. Flour of extra class can be bought by $341, first-rate flour is $315 and the second-rate -$268 per ton. This is about $20 above the prices at the end of January.
At the station Sary-Agash (Kazakhstan – Uzbekistan) wheat of 3 class costs $201, wheat with gluten content above 27-30 percent – $228. The price of barley there is $179. Flour of extra class can be bought by $367, first-rate flour is $335 and the second-rate -$314 per ton.
At the station Tobol (DAP) wheat of 3 class costs $190, wheat with gluten content above 27-30 percent – $205. Barley is sold by $149 per ton. Flour of extra class can be bought by $344, first-rate flour is $323 and the second-rate -$292 per ton.
At the station Amuzang (Uzbekistan – Tajikistan, CPT) – the cost of wheat of 3 class is fixed at $251 per ton; wheat with gluten content above 27-30 percent is sold by $266 per ton. Flour of extra class is offered by $405, first-rate flour is $386 and the second-rate -$346 per ton.
The average price of wheat of 3 class at the the station Hajraton (Uzbekistan – Tajikistan, CPT) is $258 per ton; wheat with gluten content above 27-30 percent is sold by $260 per ton. Barley can be bought by $239 per ton. Flour of extra class is offered by $413, first-rate flour is $383 and the second-rate – $361 per ton.
At the station Sarahs wheat of 3 class on the CPT terms is sold by $263 per ton; wheat with gluten content above 27-30 percent is sold by $271, barley – $254. Flour of extra class is sold by $420, first-rate flour is $393 and the second-rate – $365 per ton.
In the port of Aktau wheat of 3 class (FOB) costs $229 per ton, wheat with gluten content above 27-30 percent is sold by $255; barley – $224. Flour of extra class can be bought by $371, first-rate flour is $339 and the second-rate – $219 per ton.
Reference: $1 = 148.29 tenge, 1 euro = 194,57 tenge, 1 ruble = 5,03 tenge, 1 som = 3.16 tenge, 1 pound sterling = 235.40 tenge.