Since the appointment of Saparkhan Omarov as the Minister of Agriculture of Kazakhstan in February 2019, it has not been clear what awaits the so-called “meat project” of the country. Indeed, at about the same time, cattle breeders oligarchs voted in Parliament through “their” majilis, that they owed tens of billions of tenge in subsidies over the past year.
The Ministry of agriculture when it was silent, which is not surprising – the head of agribusiness, obviously, is not an independent figure and once again to open his mouth no one gives.
But soon, in the same Parliament made another speech, this time not in favor of large farms, in the period of mamytbekova at public expense grabbed for the sea Angus.
So, in may the Chairman of the Committee on agrarian issues of the Majilis Berik Ospanov noted that the subsidy scheme developed by the former leadership of the Ministry of agriculture (read – Asylzhan Mamytbekov and his close ones from the Meat Union of Kazakhstan) state support is distributed only in favour of large breeding companies. And this despite the fact that the main burden for development and meat production are small farms, says expert “KazahZerno.kz“.
“It turns out that investments and expenses aimed at the creation of new small farms are not subsidized. That is, we have no state support to beginning farmers, the rate at which, incidentally, made by the Ministry development program of cattle breeding in the years 2017-2028. So, we are contradicting yourself”, said Berik Ospanov. And noted that in livestock production, a significant role will always play private farms. And this requires the adoption of measures for their support. You need to create an enabling environment for smallholders to convert the family farm. And the main thing here – not only loans and investment subsidies, but also land for grazing and fodder.
Thus, it became apparent that the new head of the agrarian Committee of the Majilis, in contrast to the former (and it is none other than Saparkhan Omarov), is realistic about the situation. And now a question – what is a meat? After all, if the program and developing the agriculture Ministry, the money for its financing is still the Parliament.
The answer to this question we got at the end of July, when saparkhan Omarov presented the government a slightly updated version of the plans for the development of animal husbandry. The fact that the money for the satisfaction of dimensionless appetite of the oligarchs-pastoralists in the Treasury is not enough. So, changes are needed.
At first glance it may seem that Saparhan Omarov document is a compromise between common sense and the queries has long stuck to the Treasury group.
But a more careful study, unfortunately, makes the state – Saparkhan Omarov continues Mamytbekov, and does not deviate from it one iota.
Namely, inviolable still plans on importing breeding cattle. At the same time, the continuation of this program is required to increase funding. And how it can make the agricultural Department? Only depriving the state support all other sectors by cutting certain subsidies as “inefficient”.
That is, according to the data, originally in a Meat project for 2017 – 2027 years volume of import of Royal jelly should increase with 98.5 thousand goals in 2019 to 200 thousand goals each season in 2020 – 2022. After this, 150 thousand heads in 2023, 60 million heads in 2024.
To Finance these plans assumed through a national management HOLDING “KazAgro”.
However, as we all know, the very existence of the holding is now in question because of the astronomical losses of 120 billion tenge in the last two years.
So, for example, this year, required for import of cattle 70 billion tenge has only 54 billion, in the next — and at 46 billion of the required 140.
And what makes the Ministry of agriculture? Offers to “reduce” the plan to import up to 70 thousand head per year. At first glance, the appetites of the oligarchs cut of meat. In fact, to accomplish even this, “half” of the plan will require the allocation of additional funds from the budget!
Moreover, the amount that will have to be indexed (increased) annually, given that the rate of tenge annually collapses.
It turns out that the entire main line of activity of the Ministry of Agriculture of the Republic of Kazakhstan has remained unchanged – the support of cattle breeders oligarchs. We have already written more than once about why they need to import their breeding stock. But it is not superfluous to recall that cunning scheme that allows these people to make profits on cattle.
So, the large livestock companies that are part of the Meat Union of Kazakhstan are at the same time themselves importers of the breeding stock, and pedigree producers, and feedlots. It turns out, such monopolists of meat production.
These monopolists earn on the labor of ordinary farmers in this way: first, they sell them imported heifers, and then rent out their Angus from the pedigree producer.
After that, the farmer performs all the difficult and expensive work: contains a bull, receives litter, reeds young. Moreover, he is obliged to sell half-year-old bull-calves in the fall to a feed site at a fixed price – 350 thousand tenge!
At the same time, the owners of the breeding director-feeding site (and not the farmer) also receive the bulk of state support: from the treasury the pedigree producer receives 150 thousand tenge of subsidies for the purchase of a thoroughbred bull, and another 100 thousand tenge – for payment of maintenance. Total, 250 thousand state support – and a six-month-old goby costs the breeding producer only 100 thousand tenge of own funds. At the same time, there are practically no costs. Having kept the bull-calf for fattening for a couple of months, the breeding producer sells it for meat for more than 400 thousand tenge. That is, with a profitability of 300 percent! It is clear that with such profitability, the meat business makes cattle breeders close to the Ministry of Agriculture oligarchs..
At the same time, no one in the Ministry of agriculture (and especially in the Meat Union) don’t care what their schemes pumping budget dengue “drops” the imported cow. After the farmer received a subsidy, and after she brought him the bull (that is, by the fall) a farmer of the motive in its content there. And the main reason for this is the lack of opportunity that feed cattle in the winter.
The fact that the current number of cattle in the country (about 7 million head) corresponds to the current ability of farmers to feed a certain number of animals in the winter. And whatever foreign importation, in the fall before the farmer will be a question about the need to get rid of (sale and slaughter) from all the “extra” cows and heifers – those whom the farmer simply will not be able to provide feed.
Therefore, the import of livestock would be a waste of budget funds (subsidies), and will not increase the breeding herd in the country.
Ministry of agriculture and development State program of development of agriculture of Kazakhstan to 2017 – 2021, conducted an analysis of the forage supply in Kazakhstan. According to the analysis in the country (in 2017) was 6.4 million cattle, 18.4 million small ruminants, 2.2 million horses, 0.8 million pigs, 37 million birds.
However, the supply of feed amounted to only 58%.
In the production of hay and silage in the amount of 15.7 million tonnes, the deficit was 11 million tons (41%), in the production of feeds 1,247 million tonnes deficit – 2.186 million tons (64%), while fodder production 3.4 million tons deficit of 1.3 million tonnes (28%), in the production of silage 1.3 million tonnes deficit — 3.4 million tons (75%).
Here are a few figures: over the past 25 years in Kazakhstan, the area under crops used to create succulent feed (silage and haylage) has decreased by 28 times. The reduction affected absolutely all regions of the country. Animals feed on almost only hay, and this is a violation of all norms, since succulent feed should be at least 30% of the diet. Otherwise, there is no need to talk about any economic efficiency of animal husbandry.
Scientists calculated that in the current diet of Kazakhstani animals, protein deficiency is 25-30%. Two problems arise from this. Firstly, very low rates of weight gain for beef cattle and low yields for dairy. Secondly, trying to compensate for the scarcity of the diet, the animal eats hay much more than normal. This leads to cost overruns and reduces the economic efficiency of the economy. Plus, there is an excessive consumption of energy by the animals themselves, which need to process the “excess” low-calorie food.
Another problem using exclusively hay for animal feed is carotene deficiency. This most important element is indispensable – first of all, for the growth of young animals. It is also needed for optimal rates of weight gain when fattening cattle meat. So there is no carotene – no meat.
In addition to the lack of proteins and carotene, which can be compensated by harvesting succulent feeds, animals now also lack sugar, the deficit of which in the diet, according to scientists, is 50%.
That is, the work on creating the fodder base of domestic animal husbandry should practically begin from scratch.
In this situation, it makes no sense to import purebred cattle (under conditions of underfeeding, he simply will not be able to show the genetic potential laid down in him), nor uterine (farmers will not be able to feed him).
Earth at home
Therefore, the issue of increasing meat production in the country must be seen in the complex, whereas the importation of livestock from abroad is an attempt to concentrate only on the visible part of the iceberg. Thus, the main part of the problem will remain in the shadows.
In fact, the problem of feed production depends on the other: the farmers ‘ lack of land – as is the question to which he proposed to focus attention of the Ministry of agriculture, the current head of the agrarian Committee of the Majilis Berik Ospanov.
Moreover, it comes as pastures for grazing in the warm season, and the arable land, on which farmers could produce feed to ensure the animals in the cold period.
As we remember, in 2018, the Ministry of agriculture of Kazakhstan’s Meat project involves the creation of 80 million new farms within five years, and bringing them from 20 thousand to 100 thousand And Saparkhan Omarov confirmed these plans at a recent meeting of the government. However, last year, followed by the shaft of the signals from the field: the problem of land scarcity makes it impossible as the expansion of existing farms and to convert the Le family mini-farm.
According to the same study of the Ministry of agriculture in 2017 from 6.4 million cattle more than 3.8 million head (58%) were kept in smallholdings. At the same time, ordinary villagers have no other way to feed their cattle, otherwise how vipasa it to land around settlements. These lands due to the intense excessive exploitation of already degraded. An additional burden to bear can not.
Even more difficult issue of providing forage in the winter: without their arable land and hay meadows to grow forage and hay they are not able to. As a result, have to buy food from farms, and for many – too heavy financial burden, depriving the meat production profitability.
Therefore, the expectation is that the rural population will be able to purchase the imported cattle and expand the breeding stock will not be pardoned.
As a result, livestock imports create a scheme in which government subsidies, supposedly designed to help broaden the broodstock, are used for other purposes.
In June this year, the Minister of Agriculture, Saparkhan Omarov, speaking at a reporting meeting in Nur-Sultan, reported on inspections conducted at border points in southern Kazakhstan. Numerous facts have been revealed of the export of breeding stock to Uzbekistan and Kyrgyzstan. Moreover, livestock is sold without documents, smuggling.
That is, the situation is as follows: the farmer acquires imported livestock (breeding stock) in the prescribed manner. It receives state subsidies that should help expand the breeding stock in the country.
But instead (realizing that in winter he will have nothing to feed this cow), he sells it abroad. As a result, the effectiveness of subsidies is zero: until the issue of forage and pasture supply for farmers and private household plots is resolved, it makes no sense to import livestock into the country – it will not stay inside Kazakhstan anyway. And the goal outlined by the Ministry of Agriculture and the Meat Union, for which huge amounts of money are being requested from the budget, remains unattainable – there is no increase in the number of breeding stocks in the country.
Indeed, the issue of increasing beef production does not rest on the problem of shortage of breeding stock, but on the problem of shortage of feed and land from private farms and small farms for their production.
Let us recall that one after another, two cattle import programs were initiated in Kazakhstan – first thoroughbred (in 2011-2014 as part of the Project for the Development of Export Potential for Cattle Meat), and at the moment – the mentioned Meat Project for 2017-2028.
The first project, with the light hand of Mamytbekov, was a failure – the first target indicator (export of 60 tons of beef at the end of 2016) not only was not achieved – the country did not even reach self-sufficiency in beef (98% at the end of 2018).
And the second program, which is being implemented now, also shows all the signs of an approaching failure. This raises a fundamental question: so why, in general, the whole emphasis of state support to the Ministry of Agriculture of the Republic of Kazakhstan year after year is placed on beef production? Why does the ten-year history of failure not change anything in the approaches of the agricultural department? Many experts disagree with this position, and call the development of poultry, sheep, horse breeding and pig breeding much more promising..
Export pig breeding
The advantages of pig farming include the obvious fact that pigs are kept indoors. In this regard, the risk of infection (foot and mouth disease, anthrax, etc.) on pastures to which cattle is exposed is minimal.
In addition, the fact that in the domestic market, due to national traditions, this meat has limited demand can be considered a plus of pig farming. Therefore, the entire industry can initially be built as exclusively export-oriented (sales markets – China, Russia).
As for feed, the large volume of grain production in Kazakhstan removes this problem – the conversion of low-grade wheat to meat is much more profitable than simply selling it abroad.
This is how Viktor Lim, chairman of the board of the Union of Pig Production Farms of Kazakhstan, who unites three dozen industrial enterprises producing pork on an industrial basis, comments on the situation:
«We talk a lot about beef, lamb, and poultry, but hardly remember pork. But if you take the structure of meat consumption in the world, pork takes 40%. This opens up enormous prospects for export. Now China annually imports 1 million 900 thousand tons of pork, and the volume is growing. Moreover, the price is very favorable, $ 3.5 per kilogram. Another 265 thousand tons per year are imported by Russia. So our task is only one – to give volumes».
Constraints of development of pig production – delaying the opening of the China market.
Also there is a delay in the timing of the creation breeding and hybrid center, which would solve the issue of breeding by the American company GSI. The project of its construction was approved in 2018. But the issue rested in the financing. The cost of the first phase of the project (selection and hybrid centre for 2.5 thousand heads) will amount to 12 billion tenge. A mere trifle in comparison with what is allocated to oligarchs herders! The money should go through one of the subsidiaries of “KazAgro”. But apparently they are not there: otherwise, all went for purchasing breeding stock abroad…
But the result of the project should provide an annual production of 100 thousand tons of pork, which will be fully exported and earn the country foreign exchange earnings.
The mutton and horse meat traditional for Kazakhstan possess huge export potential. It is no accident that in the Steppes for thousands of years they have relied on these animals.
There is only one question – to reduce the cost of these types of meat. And this is quite real. An example is neighboring Mongolia, where horse meat in the domestic market costs about 600 tenge per kg in terms of Kazakhstani currency. In Kazakhstan – from 1600 tenge.
The cost of a kilogram of mutton in Kazakhstan is now 550-600 tenge, but there is also the opportunity to reduce it.
The reason for the low prices for traditional types of meat is that in Mongolia the number of horses is very high – about 7 million. And this is with a population of 3 million people. That is, for each person there are two horses. Moreover, in Kazakhstan there is only one horse for six people.
Kazakhstan needs to solve several fundamental issues in order to increase the number of horses in the country, thereby reducing the cost of meat. And here, first of all, the fight against horse stealing is necessary – toughening criminal liability, creating a traceable meat supply chain from the farm to the table, the development of long-term GPS sensors.
There is a demand for horsemeat and lamb both on the external and domestic markets. For example, the price of one sheep in Arab countries is $ 350, while in Kazakhstan $ 100. There is also a growing demand for horse meat, which is valued for its environmental friendliness. There are all conditions for the development of these industries in Kazakhstan: if the number of horses in Kazakhstan is now estimated at 3 million heads, then its growth is potentially possible up to 50 million, according to the famous academician Toregeldy Sharmanov, president of the Kazakh Academy of Nutrition. His expert opinion is based on the fact that almost 80% of the area of Kazakhstan is steppe, forest-steppe, semi-desert. They are suitable for keeping horses. As for sheep breeding, from the current 18 million heads, the number of IFAs for 5-7 years is quite possible to double, to 36 million.
In addition, the development of the production of horse meat and lamb, while reducing their cost, will help reduce the demand for poultry, in which its own production covers the needs of the domestic market of Kazakhstan only by half. It is no secret that today Kazakhstanis choose poultry meat not because of consumer preferences, but because it is half the price of other types of meat. By the way, despite the increase in poultry meat production, security in 2018 decreased to 51% compared to 52% in 2017 due to an increase in demand: Kazakhstanis are forced to switch to poultry meat, as other types of meat become unavailable for them due to economic reasons.
In the case of an increase in the number of horses and small cattle, the cost of horse meat and lamb will decrease – and Kazakhstan will choose these types of meat. So, the demand for the bird will fall.
That is why experts advise changing the emphasis of state support, equalizing its volume for all sectors of livestock. And the farmer himself will be able to choose what to do, focusing on the market, and not on the policy of the Ministry of Agriculture. Now, a clear shift in emphasis on cattle breeding is evident: there is practically no subsidy in horse breeding and sheep breeding, and all the money without special returns goes to support cattle.