Golden drought in Kazakhstan

Current drought is not so big problem for Kazakhstan, but a good opportunity to earn good money, reported IA “Kazakh-Zerno”.
The problems of Kazakhstan farmers did not begin with this year drought, on the contrary – an unexpected problem became record high yield in 2009. After harvesting a third more of grain than in 2008, the farmers faced with the problem of lack of adequate price demand. If in 2008 State Food Contract Corporation bought high quality wheat by $230 a ton, then in the fall of 2009 – maximum price was $ 130 a ton. Even so, taking into account the huge crop (22 million tons), Government purchases in the total volume of 4.6 million tons were not very helpful. Farmers had to sell the unsold crop in the open market. And then the prices in the spring fell to $90 a ton, taking into account the fact that prime cost is about $ 100. 
In this regard, the drought has become to some extent a good way out. It is better to write off crop completely burnt by the sun and get a crop insurance (there is a law on compulsory insurance of crops in Kazakhstan), than to invest a lot of resources in order to produce and sell the crop and not to receive from buyers money even for covering all costs. 
One more advantage of drought is a mad jump in grain prices, which rose during the month from $90 to $250. In this situation, won those farmers who stored their grain. They covered all previous losses and now have the chance to harvest the current crop, knowing that this year crop will be exactly the golden wheat.
It should be noted that the harvest in Kazakhstan is not so bad. 
In the republic 83% of grain crops are in good and satisfactory condition. 12% of crops (1,9 million hectares) are in poor condition, and 883000 hectares(5%) were killed by the drought.
According to preliminary data the harvesting area of cereals will be 15.6 million hectares, which is 1.0 million hectares less than last year. Projected gross yield of grain can be about 13.5 million tons. 
Taking into account the impressive carryover stocks, Ministry of Agriculture made a preliminary forecast of export capacity of 8 million tons. 
It is clear that with this crop there is no need to impose restrictions on the export of grain in Kazakhstan despite requests from Russia, a partner of Kazakhstan in the Customs Union. On the contrary, President Nursultan Nazarbayev instructed the Government to do everything possible to take advantage of the situation and to gain a position of a reliable supplier in the international grain market.
Reference: $1 = 147.17 tenge

Rate article
Kazakhzerno
Leave a Reply