11 February 2021, 19:02
The coronavirus pandemic, which has forced almost the entire world to face a crisis, has affected all areas of human life. The crisis has not spared the agricultural sector, including in Kazakhstan. However, despite all those difficulties — the restriction of movement between regions within the country, difficulties with the import and export of agricultural products in conditions of closed borders, the import of agricultural machinery and equipment, etc., Kazakhstani farmers still managed to carry out sowing and harvesting works, launch new enterprises for the production of raw materials and finished products. Government of the Republic of Kazakhstan and the measures developed for this purpose provided significant support to agricultural producers during the pandemic.
Thus, the sowing campaign in the republic in 2020 was carried out in difficult conditions, when the state of emergency was in effect everywhere. However, in spite of this, Kazakh agronomists carried out sowing of agricultural crops in an orderly manner and at the optimum time.
In total, in 2020, rural workers harvested more than 20.8 million tons of grain in original weight. This allows you to fully meet the internal needs of the republic, as well as increase the export potential, while maintaining the status of Kazakhstan as a grain power.
The ministry took the necessary measures aimed at ensuring the timely and high-quality conduct of spring field work. Thus, an algorithm for the movement of agricultural producers during the coronavirus pandemic, approved at a meeting of the State Commission on ensuring the state of emergency under the President of the Republic of Kazakhstan on April 15, 2020, was developed and sent to the local executive bodies.
In addition, amendments have been made to the resolution of the Chief State Sanitary Doctor of the Republic of Kazakhstan, providing for the provision of free movement for persons involved in spring field work.
The measures taken made it easier for agricultural producers to pass checkpoints for the supply of fuels and lubricants, mineral fertilizers, plant protection products, spare parts for agricultural equipment, livestock and food, which made it possible to carry out spring field work in a timely manner.
Thanks to the above measures, in 2020 the sown area of all agricultural crops amounted to 22.7 million hectares, which is 0.5 million hectares more than the level of 2019. Of these:
- grain and leguminous crops — 15.9 million hectares, including wheat — 12.2 million hectares;
- oilseeds are located on an area of 2.9 million hectares;
- cotton plant — by 125.7 thousand hectares;
- sugar beet — by 20.9 thousand hectares;
- potatoes — by 192.8 thousand hectares;
- vegetables — by 162.7 thousand hectares;
- melons and gourds — by 101.9 thousand hectares;
- fodder crops — by 3.3 million hectares.
Support programs for Kazakh agricultural producers during emergency
The following support measures are envisaged by the Government Resolutions:
- exemption of agricultural producers from the land tax on agricultural land until Dec. 31, 2020;
- suspension of the accrual of penalties on unfulfilled tax obligations until Aug. 15, 2020 and postponement of the deadline for submitting tax reports to the 3rd quarter of 2020;
- inclusion in the list of imported goods for which VAT is paid by the offset method, cattle and breeding chickens;
- setting the VAT rate for socially significant food products at 8% by Oct. 1, 2020;
- at the same time, for all small and medium-sized businesses, a deferral was granted to pay taxes and social payments until June 1, 2020, and all measures of compulsory collection of tax and customs debts were suspended;
- for the period from Jan. 1, 2020 to Jan. 1, 2023, persons applying special tax regimes and recognized as subjects of micro-business or small business, including payers of the single land tax, are exempted from paying taxes on income (Article 57-4 of the Law of the Republic of Kazakhstan "On the Enactment of the Code of the Republic of Kazakhstan "On taxes and other budget’’ (Tax Code).
It is worth noting that the main task during the coronavirus pandemic was to carry out spring field work at the optimal time. The total sown area was increased to 22.5 million hectares, and the growth of areas for highly profitable and fodder crops was ensured on 238 thousand hectares.
In addition to the above measures to support the subjects of the agro- industrial complex of JSC Agrarian Credit Corporation from the republican budget was allocated a budget loan in the amount of 70 billion tenge, which is 10 billion more than usual. Interest rate for end borrowers did not exceed 5% per annum.
In addition, as part of the execution of the instruction of the Head of State Tokayev for carrying out spring field work within the framework of the Economy of Simple Things program, an additional 100 billion tenge was allocated. The final interest rate, taking into account subsidies, was 6% per annum for borrowers.
Also, the farmers were provided with a deferral and restructuring for loans and leasing through JSC NMH KazAgro.
At the request of the regions, about 387 thousand tons of diesel fuel were allocated at a price 15% lower than the market price.
To maintain growth rates in the context of the coronavirus pandemic, by the decision of the Republican Budget Commission of April 2, 2020, an additional 60 billion tenge was allocated to the agro-industrial complex, which made it possible to bring the total amount of subsidies to 377.7 billion tenge.
In 2020, local executive bodies provided 92.4 billion tenge for the development of livestock breeding, increasing the productivity and quality of livestock products.
At the same time, in order to implement anti-crisis measures, by the decision of the republican budget commission, an additional 10.5 billion tenge was allocated from the republican budget for the implementation of this program.
In addition, for the purpose of state support for agricultural producers, an additional 12.3 billion tenge was allocated from the reserve of the Government of the Republic of Kazakhstan.
At the same time, by a Government decree of May 20, 2020, a Comprehensive Plan for Restoring Economic Growth by the End of 2020 was approved, which also provides for measures aimed at supporting and developing the agro-industrial complex.
As part of these measures, the practice of guaranteed purchase of agricultural products was introduced, which will provide a guaranteed purchase of up to 365 thousand tons of agricultural products.
Also, the farmers were provided with a deferral and restructuring for loans and leasing through JSC NMH KazAgro.
How forward purchase works in Kazakhstan
In order to implement the order of the President Tokayev dated March 31, 2020 on the development and launch of a mechanism for guaranteed purchase of products from domestic agricultural and processing enterprises at least 6 months in advance, the decision of the State Commission on the State of Emergency supported the proposal to finance the forward purchase of agricultural products in the amount of 24.5 billion tenge.
This measure is aimed at supporting domestic agricultural producers in order to ensure high-quality and timely spring field work and get them a stable harvest, which directly affects the food security of the republic.
Under the forward purchase program, 322 agricultural enterprises (151 — peasant farms, 171 — LLPs) were financed for a total amount of 39.6 billion tenge, of which an advance payment of 24.55 billion tenge was made from the republican budget and an additional payment in the autumn period in the amount of 15 billion tenge at the expense of the Food Contract Corporation's own funds. As a result, 483.8 thousand tons were delivered against the plan of 365 thousand tons.
In order to support domestic producers engaged in crop production, as part of the implementation of anti-crisis measures, by the decision of the Republican Budget Commission of April 2, 2020 No. 6, an additional 11.0 billion tenge was allocated from the republican budget for the development of the industry, including for subsidizing the development of seed production 2.6 billion tenge, fertilizers — 2.8 billion tenge, and pesticides in the amount of 5.6 billion tenge.
The funds allocated to subsidize the development of seed production made it possible to additionally finance 1,027 business entities about 30.7 thousand tons of seeds of high reproduction and 14.8 thousand sowing units of seeds of first-generation hybrids, as well as 729.6 thousand pieces of elite seedlings.
In total, in 2020, within the framework of the seed production subsidy program, 6,803 farmers received state support, for whom the purchase of 128 thousand tons of seeds of high reproductions, 216.3 thousand sowing units of seeds of first generation hybrids, as well as 6,747, were reduced in price by 14.2 billion tenge, 5 thousand pieces of elite seedlings.
27.8 billion tenge was allocated to subsidize the cost of mineral fertilizers. Thus, agricultural producers were able to purchase 533.0 thousand tons of mineral fertilizers, which is 131.3 thousand tons more than in 2019.
In addition, for the purpose of state support to increase the yield and quality of agricultural crops, pesticides were purchased through subsidies. In total, 36.6 billion tenge was allocated for this direction from the local and republican budgets, due to which the purchase of 19.1 million liters of cheaper pesticides was subsidized, which is 5,940.6 thousand liters (or 45%) more than in 2019.
In total, in 2020, within the framework of the program for subsidizing the cost of water supply to farmers, 828 agricultural producers received support from the state, for which the service of supplying 3,602.5 million m3 of water was subsidized in the amount of 1.86 billion tenge.
To stimulate the acquisition of agricultural machinery and, accordingly, increase the level of renewal of the machine and tractor fleet in the agro-industrial complex, the financial availability of the purchase of agricultural machinery was ensured.
In this regard, the Ministry of Agriculture of the Republic of Kazakhstan has developed the following measures:
1) within the framework of the program to subsidize investment costs:
- 25% of the cost of purchasing agricultural machinery is reimbursed from the state budget. The subsidy rate can be independently increased by regional akimats (up to 35%) at the expense of the local budget for priority types of machinery and equipment provided for in regional development programs.
In addition, for priority types of agricultural machinery, machinery and equipment, the regional akimats have the right to increase the subsidy standards:
At the same time, the problem of an initial payment for agricultural producers was solved by transferring investment subsidies in advance to the lessor (creditor);
2) there is a program for subsidizing interest rates on loans / leasing for the purchase of agricultural machinery (10%).
Under this program, since 2018, the program budget has been increased from 16 billion tenge to 21.8 billion tenge in 2019. Considering that the bulk of the purchase of agricultural machinery comes through leasing, subsidizing of interest rates on loans / leasing in the amount of 10% allows to reduce the final rate for farmers to 7% (at the current rate of remuneration in KazAgroFinance JSC of 17%), which reduces the financial burden;
3) for participants in investment programs for lending for the development of beef cattle breeding, when purchasing forage equipment, the interest rate for loans and leasing does not exceed 4% per annum in tenge and the loan period has been extended to 15 years. Under this program, lending is provided for domestically produced forage equipment, which simultaneously stimulates the sale and production of equipment of domestic enterprises (through the financial institutions of KazAgro NMH JSC — Agrarian Credit Corporation JSC and Agricultural Financial Support Fund JSC).
From April 1, 2020, the main leasing company of Kazakhstan, KazAgroFinance JSC, has approved the Made in Kazakhstan program for leasing domestic equipment. Financing is provided at the expense of the National Fund and amounts to 20 billion tenge.
Under the terms of this program, agricultural producers purchase domestic equipment for a lease term of up to 10 years with an annual interest rate of 6%. At the same time, a grace period is provided for 1 year.
A similar program is being implemented by DBK Leasing JSC.
In general, the programs implemented by the ministry to ensure the financial availability of agricultural machinery to farmers have shown a positive trend in the renewal of the machine and tractor fleet of the republic.
In 2020, KazAgroFinance JSC leased 5,900 pieces of equipment for 113.0 billion tenge.
It should be noted that in 2019 (143) in comparison with 2018 (72) the purchase by agricultural producers of high-performance seeding complexes that simultaneously perform several operations (cultivation, sowing, fertilization, harrowing, leveling the surface and rolling the soil).
The presence of more than 4 thousand seeding complexes in 2020 made it possible to ensure sowing of 70% of the grain wedge of the republic.
In order to ensure timely sowing and harvesting operations in February-October 2020, 792 thousand tons of diesel fuel were allocated, including:
Results of State Program for Development of Agro-Industrial Complex for 2017-2021 by the end of 2020
By the preliminary results of 2020, positive growth dynamics is observed in the agro-industrial complex.
Thus, the volume of gross agricultural production in this period increased by 5.6% and amounted to 6.3 trillion tenge. This growth was mainly due to an increase in crop production by 7.8%.
The volume of gross livestock production for the specified period increased by 3% and amounted to 2.6 trillion tenge.
Investments in fixed assets in agriculture for 12 months of 2020 increased by 15% and amounted to 573.2 billion tenge, food production — by 13.5% and amounted to 104 billion tenge.
Models of development of agro-industrial complex of Kazakhstan
Currently, the State Program for the Development of the Agro-Industrial Complex of the Republic of Kazakhstan for 2017-2021 is being implemented, the purpose of which is to increase the competitiveness of the agro-industrial complex. The measures provided for by this state program are aimed at further developing the country's agro-industrial complex, including ensuring food security, increasing the availability of financing for agribusiness entities, increasing the efficiency of land and water resources use, ensuring the availability of sales markets, developing exports, and others.
Given that the end of the implementation period of the state program is set for 2021, the Ministry of Agriculture of Kazakhstan has begun to develop a new National Project for the development of the agro-industrial complex until 2026. For the qualitative development of the new National Project, FAO experts in the field of agriculture were involved.
Now, together with FAO experts, an analysis of the current situation over the past 5 years is being carried out, including the impact of the industry on the socio-economic and socio-political development of the country, as well as global trends. In the future, based on the analysis, problematic issues will be formed, as well as a list of unrealized measures, the solution of which will contribute to the qualitative development of the country's agro-industrial complex.
So, within the framework of the new National Project, issues of affordable financing, land relations, development of agro-science, digitalization of the industry, veterinary and phytosanitary safety, as well as issues of developing the export potential of not only raw materials, but also its processing will be worked out.
Kazakhstan is guided by successful experience of developing agro-industrial complex of the leading countries of the world
When developing a long-term policy in the agro-industrial complex, Kazakhstan uses the experience of the developed countries of the world, which occupy leading positions in one or another sub-sector of agriculture. So, for example, in the field of crop production, the development model of countries such as Canada, Ukraine and Russia is used, that is, with similar natural and climatic conditions. As for individual crops, for example, soybeans, the experience of the leading countries — the USA and Brazil — is used for its cultivation. By the way, the experience of these countries, as well as of Argentina, is used and successfully operates in the field of beef production. Argentina, by the way, is an example in the development of agricultural science and the dissemination of knowledge, as well as a country that has made a breakthrough in the innovative and technological development of the agro-industrial complex in a short period.
In milk production, the benchmarks for our country are Germany, France and New Zealand. We also trust the experience of Russia, Ukraine and Belarus. In the sheep breeding industry, Kazakhstan is interested in and uses the experience of Australia, New Zealand, as well as European countries.
In general, for individual crops in different regions of Kazakhstan, given the size and vastness of climatic zones, different experience can be used, and, accordingly, technologies, seeds and equipment. When developing a Kazakh model of agricultural cooperation, the experience of such countries as Germany, Denmark, Italy, Turkey and Brazil was studied and used.
It should also be said that when developing approaches and determining the amount of state support for the agricultural sector, Kazakhstan adheres to the obligations and restrictions provided for by agreements concluded within the WTO and the EAEU.
Where ecosystems for production and processing of agricultural products created in Kazakhstan
One of the most priority areas for the development of crop production is the formation of ecosystems around large investment projects. This will allow local producers of goods and services to participate in creating the value of the final export product throughout the entire production in the following areas: production and deep processing of grain, seed oil, fruit and sugar production, based on the specialization of regions and the availability of resources (land plots, raw materials, climatic conditions). At the same time, the principle of vertical cooperation will be mainly applied in order to enlarge farms, provide its own material and technical base, sustainable sales, which is beneficial to both farmers and processors.
The core of the complex for the production and deep processing of grain is concentrated in the Taiynshin district of the North Kazakhstan region. So, this year, the 2nd stage of construction of a line for the production of bioethanol at the BioOperations plant in the North Kazakhstan region is being completed (previously, lines for the production of flour, starch, gluten, feed for agricultural animals were used). The advantage of the complex is the availability of land resources and a raw material base (19% of wheat sown areas are located in the North Kazakhstan region).
The sugar production ecosystem is being formed in the city of Shu, Zhambyl region. Now at the stage of elaboration there is the issue of financing the project, which will be integrated with the development of the raw material base through the restoration of additional irrigated land and the creation of an irrigation system, cooperation of local farmers with the aim of independent and joint cultivation of sugar beets, providing their own material and technical base (equipment, seed fund , plant protection products and fertilizers, both for their own needs and for the needs of sugar beet farmers).
Almaty and Turkistan regions are considered as the most suitable locations for setting up an intensive orchard and fruit processing plant. At the end of 2020, 1,800 hectares of apple orchards were laid, including 750 hectares (41%) in Turkistan and 574.3 hectares (32%) in Almaty regions.
The formation of an ecosystem for oilseeds is envisaged on the basis of large investment projects in Akmola (LLP Logos Grain) and East Kazakhstan regions (LLP Kazakh Astyk Group).
Area of irrigated land in republic will grow
In pursuance of the instructions of the President of the Republic of Kazakhstan Kassym-Jomart Tokayev on a gradual increase in irrigated land to 3 million hectares by 2030, the regional akimats plan to bring this value within 787 thousand hectares, of which in:
- Akmola region — on 112 thousand hectares,
- Almaty — 83.5 thousand hectares,
- Aktobe — 56.4 thousand hectares,
- East Kazakhstan — 202.2 thousand hectares,
- West Kazakhstan — 6.5 thousand hectares,
- Kostanay — 16.9 thousand hectares,
- Karaganda — 74.1 thousand hectares,
- Kyzylorda — 51.3 thousand hectares,
- Pavlodar — 94.5 thousand hectares,
- North Kazakhstan — 4.9 thousand hectares,
- Turkistan — 85.5 thousand ha.
Also, regional akimats carried out relevant work to identify potential large land users on new irrigated lands, potential investors for the construction of irrigation networks and the implementation of projects for the development of new irrigated lands and the development of proposals for the placement and structure of cultivated crops.
In addition, regional akimats are working to transfer land from non-irrigated arable land to irrigated. So, according to the land balance, in 2020, the republic has 2.251.1 million hectares of irrigated land, of which 1.715 million hectares are arable land, which is 26.6 thousand hectares more than the level of 2019.
Also, indicators for an increase in irrigated land, including the construction of irrigation and drainage systems and 38 new reservoirs, are provided in the developed draft State Program for Water Resources Management until 2030.
Work in this direction continues.
How digitalization affects area of irrigated land
In order to expand the area of irrigated land within the framework of the State Program for the Development of the Agro-Industrial Complex for 2017-2021, restoration of irrigation and drainage infrastructure of demanded irrigated lands on the area of 610 thousand hectares is envisaged. In 2016, the area of irrigated land, where the water infrastructure was installed, amounted to 1,400 thousand hectares. Taking into account the restoration of water infrastructure for water supply in 2017-2019, at the beginning of 2020, the area of irrigated land, where the water infrastructure is connected, is 1,546 thousand hectares.
In accordance with the instructions of the First President of the Republic of Kazakhstan - Elbasy Nursultan Nazarbayev, the Ministry of Agriculture is constantly working to diversify the sown areas of agricultural crops. At the same time, diversification provides for an increase in the areas of highly profitable crops (oilseeds, grain fodder, vegetables and melons) and crops, for which most of the needs of the population of the republic are provided with imported goods. In this regard, on the restored irrigated lands, agricultural producers cultivate oilseeds, grain fodder, and vegetable and melon crops.
In turn, the Ministry of Ecology, Geology and Natural Resources continues to work on the restoration of the water infrastructure to supply water to the remaining area of non-restored irrigated land.
In addition, in accordance with the Address of the President Kassym-Jomart Tokayev, the Ministry of Agriculture of the Republic of Kazakhstan, together with interested state bodies, akimats of the cities of Nur-Sultan, Almaty, Shymkent and regions, as well as NCE Atameken, work is underway to gradually bring the area of irrigated land to 3 million hectares by 2030.
According to the land balance in 2019, the republic had 2.224 million hectares of irrigated land, of which 1.779 million hectares (80%) were in agricultural land, 244.7 thousand hectares (11.1%) — in reserve lands, 180.1 thousand hectares (8.2%) — in the lands of settlements. Considering the dynamics of changes in the areas of irrigated land for 1991-2019, it is possible to trace the tendency of an increase in the areas of irrigated lands, and at present they have reached the level of 2000 (1991 — 2,379.5 thousand hectares, 2000 — 2,227.6 thousand hectares), 2017 — 2,181.0 thousand ha, 2018 — 2,203.1 thousand ha).
In accordance with this instruction, the Minister of Agriculture approved a Roadmap for a phased increase in the area of newly introduced irrigated land until 2030. The Roadmap provides for the development of feasibility studies, design and estimate documentation, as well as the construction of irrigation and drainage systems with design and estimate documentation with a positive expert opinion.
In addition, indicators for an increase in irrigated land, including the construction of irrigation and drainage systems and 38 new reservoirs, are provided for in the developed draft State Program for Water Resources Management until 2030. Starting from 2021, due to the reconstruction of irrigation networks with a length of 6 thousand km and the large-scale implementation of digitalization on 119 main main canals (until 2025), 2 km3 of water will be saved per year. For these purposes, in the next 5 years 192 billion tenge will be allocated from the republican budget and funds of international financial organizations.
The widespread introduction of digitalization of water accounting and automation of water distribution at water management facilities will reduce water losses in these canals from 40 to 17%. The draft State Program for Water Resources Management of the Republic of Kazakhstan until 2030 provides for a phased introduction of digitalization to maintain reliable accounting and save water resources.
Significant events in agro-industrial complex that significantly influenced the development of industry
The global economic situation caused by the coronavirus pandemic has exposed serious problems in food security for many countries of the world, and a general understanding of the role of agriculture in ensuring the country's security and well-being has increased. In this regard, the issue of import substitution has become a priority for most states. To resolve these issues, a set of measures was taken in Kazakhstan.
For example, in 2020, 48 dairy farms with a total capacity of 93.1 thousand tons of milk were launched, 1,800 hectares of orchards were planted with a total capacity of 63 thousand tons of apples per year, 3 meat processing plants with a total capacity of 33 thousand tons of meat products, 8 poultry farms with a total capacity of 95 thousand tons of poultry meat, 3 fish production facilities with a total capacity of 2.2 thousand tons of fish.
No shortage of agricultural stocks in the country
According to the operational data of the regions, as of Dec. 31, 2020, the republic has stocks in the total volume of 2.4 million tons of various foodstuffs, including at manufacturing enterprises — 1.6 million tons, in warehouses — 547 thousand tons. tons, in retail chains — 177.6 thousand tons, in stabilization funds — 35.9 thousand tons. In addition, there are 363.7 million eggs and 11 million tons of milling wheat.
The availability of available foodstuffs according to actual consumption is for different types of products from a week to several months. At the same time, their stocks are constantly replenished and therefore a deficit on them is not expected.
The Ministry of Agriculture of the Republic of Kazakhstan is taking all possible measures to support farmers. So, during the pandemic, decisions were made in the form of an increase in preferential lending, subsidies, preferential volume of fuel and lubricants for spring field and harvesting work.
With regard to food supply, on average domestic production covers the needs of the population of Kazakhstan by 80% or more. The exception is 6 types of foodstuffs, including poultry, sausages, cheese and cottage cheese, apples, sugar, fish. To solve import dependence on these goods, a Comprehensive Plan for saturating the domestic market with domestic products for 2021-2023 was adopted, according to which the provision for these goods will be about 100% by the end of 2023, and for sugar — 80%.
It is also worth noting that during the state of emergency, Kazakhstan continued to conduct trade relations with all states and no restrictions were introduced in the field of plant quarantine.
There are a number of goods, the import of which is necessary for Kazakhstan due to the impossibility of their production on the territory of the republic, for example, due to natural and climatic conditions. Or, imported goods are necessary for the operation of domestic processing enterprises.
100% of internal demand for meat, fish and dairy products will be met by 2023 in Kazakhstan
In general, it should be noted that according to the results of the past period, as part of the development of a long-term program of dairy farming aimed at import substitution of dairy products, the volume of milk production at the end of 2020 (according to preliminary data) increased compared to the same period last year by 3.2% and amounted to 6.0 million tons. At the same time, the growth in agricultural enterprises amounted to 7.3% or 1.7 million tons.
The volume of poultry meat production in live weight at the end of 2020 (according to preliminary data) increased by 5.1% compared to the same period last year and amounted to 294.1 thousand tons. Nevertheless, the import dependence on poultry meat in the country is significant.
Poultry meat
Production of poultry meat in 2020 amounted to 235.2 thousand tons. It is planned that by the end of 2023 the domestic market will be provided by 100% due to the commissioning of 19 new poultry farms with a capacity of 285 thousand tons of poultry meat, as well as additional loading of existing poultry farms by 20%. This will make it possible to bring the annual production of poultry meat up to 400 thousand tons or to the level of self-sufficiency.
In particular, following the results of last year, 8 poultry factories for meat production were put into operation with a total production capacity of 94.5 thousand tons of poultry meat per year (Akmola — 2, Almaty — 3, Kostanay — 2, Turkistan — 1). The main volume of production according to these poultry farms is expected in the first half of 2021.
Meat and sausage products
In 2020, 1 project was introduced in the North Kazakhstan region (EMC-Agro LLP) and 2 projects were modernized in the Karaganda and East Kazakhstan regions (ArayKZ LLP and ArayEastFood LLP) with a total capacity of 6.3 thousand tons per year.
It is planned to provide the domestic market by 100% by the end of 2023 by introducing 9 new projects for the processing of meat and meat products in 2021-2022, including AiZetFarms LLP, Nur-Sultan, BEEF EXPORT GROUP LLP, Kostanay, Syr Marzhany LLP, Kyzylorda and others with a total capacity of 103.8 thousand tons.
In the first 11 months of 2020, the volume of meat production (excluding poultry meat) amounted to 435.1 thousand tons, which is 3.2% more compared to the same period in 2019.
During the same reporting period, the production of sausages also increased by 11.8% (from 48.1 to 53.8 thousand tons), as well as canned meat and meat-vegetable products by 13.8% (from 7.7 to 8.8 thousand tons).
Cheese and cottage cheese
Production of cheese and cottage cheese in January-November 2020 amounted to 29.6 thousand tons. In order to saturate the domestic market with cheese and cottage cheese, work is being carried out to increase the production of raw milk that is suitable for cheese and to increase the load of milk processing enterprises.
At the end of 2020, 48 industrial and family milk farms were commissioned with a total livestock of 16.2 thousand heads of cattle and a production capacity of up to 93.1 thousand tons of milk per year.
Of these, 17 industrial milk farms were put into operation with a total livestock of 12.5 thousand head of cattle and a production capacity of up to 87.8 thousand tons of milk per year (Akmola — 3, Aktobe — 1, Almaty — 2, East Kazakhstan region — 1 , West Kazakhstan region — 1, Kostanay — 1, North Kazakhstan region — 3, Pavlodar — 4, Turkistan — 1).
In order to saturate the domestic market with cheese and cottage cheese by 100% by the end of 2023, it is planned to put into operation an additional 105 milk farms in 2021-2023, allowing to produce about 403 thousand tons of milk.
Fish
For 11 months of 2020, the volume of production of chilled and frozen fish amounted to 58.2 thousand tons, canned fish — 26.1 thousand tons.
At the end of 2020, 3 projects for 2,250 tons were implemented:
- Murager LLP for 1,500 tons of marketable fish in the Aktobe region,
- KordaiFish LLP for 500 tons of marketable fish capacity,
- Arnur LLP for 250 tons of marketable fish in the Zhambyl region.
By 2022, it is planned to introduce 4 more enterprises with a total capacity of 9.4 thousand tons.
Opportunities for export and import of Kazakhstani products
To open new sales markets, the Ministry of Agriculture of the Republic of Kazakhstan is systematically working to harmonize the phytosanitary and veterinary requirements of importing countries, expanding the list of Kazakhstani enterprises in foreign supplier registers. This made it possible to export the following Kazakh agricultural products:
- to China: beef, lamb, live horses, fish, honey, wheat, wheat bran, soybeans, alfalfa, rapeseed meal, barley, corn, flax seeds, wheat feed flour and wheat flour;
- to Iran: frozen and chilled lamb, beef, by-products of small cattle, chicken eggs, live sheep, wheat, barley, sunflower seeds, rape and flax;
- to the CIS countries: live cattle and small ruminants, beef, lamb, fish, dairy products, eggs, fruit and vegetable crops, wheat, corn, rice, sunflower seeds, flax and rape;
- to EU countries: fish, wheat, flax seeds;
- to the United Arab Emirates: meat and meat products, chicken eggs and poultry;
- to the Kingdom of Saudi Arabia: and small ruminants for slaughter.
There is also a positive trend in the export of processed products. So, for 10 months of 2020, the export of processed products increased by 17.3% ($1 billion) compared to the same period in 2019 ($871.5 million).
The export of agricultural products in 2020 looked like this:
- beef — 7,254.2 tons,
- horse meat — 4.06 tons,
- mutton — 1,303.8 tons,
- pork — 1,275.8 tons,
- camel meat — 0.003 tons,
- poultry meat — 11,073.8 tons,
- semi-finished meat products — 923 tons,
- canned meat — 1,119.06 tons,
- sausages — 314.7 tons,
- fish and fish products — 25,031 tons,
- milk and dairy products — 20,937.2 tons,
- beekeeping products — 824.5 tons,
- edible eggs — 228,452,437 pcs.
As for imported products, the situation with imported products looked like this:
- horse meat — 1,963.6 tons,
- beef — 10,918.6 tons,
- pork — 732.7 tons,
- mutton — 10 tons,
- poultry meat — 108,438.9 tons,
- fish and fish products — 26,497.1 tons,
- milk and dairy products — 56,986.08 tons,
- meat products — 1,102.8 tons,
- sausages — 14,952.7 tons,
- honey — 24.5 tons.
To open new sales markets, the Ministry of Agriculture of the Republic of Kazakhstan is systematically working to coordinate the veterinary requirements of importing countries.
The restrictions on foot and mouth disease and lumpy skin disease, introduced by the PRC several years ago, have been lifted, which, in turn, opened up access for Kazakhstani meat products to the PRC market.
The veterinary requirements for the export of live cattle for slaughter, beef, by-products of small cattle from Kazakhstan to Iran have also been agreed.
On May 25, 2020, a veterinary certificate for the export of horse meat from Kazakhstan to Japan was agreed. The export of horse meat from 34 Kazakhstani enterprises was also approved.
The ministry plans for 2021 to continue expanding the product line, as well as opening new markets: the European Union, Turkey, countries of Southeast Asia.
Control over the veterinary and phytosanitary situation
Diagnostics of especially dangerous diseases among animals included in the list approved by the authorized body is financed from the republican budget.
For the first half of 2020, 6,829,019.0 thousand tenge are provided for conducting 40.7 million diagnostic tests for 28 especially dangerous animal diseases, such as: brucellosis, foot and mouth disease, leukemia, rabies, viral diarrhea, leptospirosis, listeriosis, pasteurellosis, tuberculosis , emkar, viral diarrhea, infectious rhinotracheitis, lumpy skin disease, bradzot, infectious equine anemia, bluetongue, Schmalenberg disease.
For the second half of 2020, in the budget program 249 "Creation of conditions for the development of animal husbandry and production, sale of livestock products" subprogram 100 "Diagnostics of animal diseases" for 26.9 million diagnostic studies, funds were provided for a total amount of 4,978,697.3 thousand tenge.
According to the Plan of veterinary measures for the diagnosis of especially dangerous animal diseases for 2020, 67,733,917 diagnostic tests or 100% of the annual plan are planned in the republic for 12 months.
How spring field work took place in 2020
Quarantine restrictive measures taken in connection with the COVID-19 pandemic also affected the agricultural industry. To support the subjects of the agro-industrial complex in these difficult conditions, the Government took anti-crisis measures. Thanks to them, as well as the painstaking work of agricultural workers, good results have been achieved.
In particular, according to the official information of the National Bureau of Statistics of the Agency of the Republic of Kazakhstan for Strategic Planning and Reforms, in January-November 2020, the gross output of products (services) of agriculture, forestry and fisheries in the country as a whole amounted to 5,925.3 billion tenge, which is 5.3% higher than the level of the corresponding period last year.
The growth in crop production in January-November 2020 is associated with an increase in crop production by 7.2%. At the same time, an increase in agricultural production of crop production in January-November 2020 compared to the same period in 2019 was noted in all regions of the republic, except for Nur-Sultan.
The largest growth in the index of the physical volume of gross crop production is noted in Kostanay (128.2%), Akmola (117.9%), Pavlodar (111%), Aktobe (109.5%), Karaganda (108%) regions and the city of Shymkent (105%).
So, this year, according to the operational data of the regional akimats, 20.8 million tons of grain and leguminous crops were harvested in the initial weight, which is $1.1 million more than last year's level, or 5.5% more.
The gross harvest of vegetables increased by 259.1 thousand tons or 6.5% against the level of last year:
In Kazakhstan, number of cattle increased by 5.5%
As of Dec. 20, 2020, the purchase of cattle for 14.3 thousand heads was financed.
It is worth noting that the current economic situation associated with the coronavirus pandemic has created an additional burden on farmers in terms of purchasing cattle outside the country.
In general, the regional akimats need to intensify work on involving farms for the purchase of cattle, including those with a ready-made infrastructure.
In 2019, a pilot lending mechanism was tested against the security of purchased livestock. In the past year, this mechanism was applied everywhere.
An important component is the continuous operation of the beef production chain. The republic has a network of feedlots for 279 thousand cattle stalls and meat processing plants for 240 thousand tons.
To stimulate farmers, a subsidy mechanism was introduced for the live weight of a bull sold to an industrial feedlot or meat processing plant.
At the end of 2020, KazAgro NMH JSC financed:
- 91 farms for 10,132 million tenge for the purchase of 15,556 head of cattle, of which 123 farms delivered 14,279 head of cattle for the amount of 9,415 million tenge;
- 722 farms in the amount of 11,828 million tenge for the purchase of 285,679 heads of small cattle.
In total, in 2020, KazAgro NMH JSC financed the construction of 5 feedlots for the amount of 3,270 million tenge.
In 2020, 1,423.6 thousand heads of breeding stock of cattle or 37.76% of the total number of cows (3,769.76 thousand heads) were involved in the breed transformation.
Thus, due to the import of foreign breeding stock of cattle, the share of breeding stock in the republic has increased significantly and amounted to 12% of the total cattle stock.
Along with this, there is an increase in the number of farms participating in the program of selection and breeding work with breeding stock of cattle (breed transformation) using bulls-producers of meat production.
So, in 2020, 25.3 thousand farms were engaged in breed transformation, while, for example, in 2016, the number of farms engaged in breed transformation of cattle was 15.8 thousand. At the end of 2020, the volume of gross livestock production amounted to 2,624.3 billion tenge, which is 3.0% more than the same period last year.
As statistics show, in January-December 2020, the number of cattle in all categories of farms in the republic increased by 5.5% and amounted to 7 848.5 thousand heads.
The dynamics of growth in the number of cattle over the past 10 years amounted to 35.5%, on average, the annual growth in the number of livestock increased by 3.3%.
It should be added that currently, in order to stimulate producers engaged in animal husbandry, within the framework of the Rules for subsidizing the development of livestock breeding increasing the productivity and quality of livestock products, approved by order of the Minister of Agriculture of the Republic of Kazakhstan dated March 15, 2019 No. 108, the cost of feed costs for all types of animals is subsidized: cattle for dairy and meat and dairy productivity, cattle for meat and meat and dairy productivity, sheep, horses and camels.
Also, within the framework of the Subsidy Rules for reimbursing part of the costs incurred by the subject of the agro-industrial complex with investment investments approved by order of the acting Minister of Agriculture of the Republic of Kazakhstan dated July 23, 2018 No. 317, subsidies are carried out for the purchase of agricultural machinery and equipment, as well as for the creation of a feed mill with a compensation share of 25%.
As measures to increase the number of livestock in 2020, through the KazAgro NMH JSC under the Sybaga preferential program, 91 agricultural producers were given loans for 15.6 thousand head of cattle.
In addition, according to the Rules for subsidizing the development of livestock breeding, increasing the productivity and quality of livestock products, approved by order No. 108 of March 15, 2019, appropriate support measures are provided in the form of subsidies.
To ensure the loading of feedlots, commodity producers are subsidized at 200 tenge per kilogram of live weight of livestock sold to the feedlot.
Mechanisms for development of beef cattle in Kazakhstan
In the beef cattle sector, the main measures are aimed at increasing the breeding stock of cattle. So, in 2018, a program of lending to farms was launched for the purchase of breeding stock. During this time, more than 1.5 thousand farms received loans and purchased livestock.
In the medium term, the task is to develop anchor cooperation with the involvement of transnational companies. The expected volume of investments due to the creation of farms will be 350 billion tenge and bringing the export of beef to $370 million by 2025. More than 42 thousand jobs will be created by farms.
Three main indicators have been identified for beef cattle breeding:
- accelerated growth of cattle breeding stock through lending to farmers;
- increasing the productivity of the livestock due to the breed transformation of the broodstock;
- development of the beef production chain by delivering bulls to industrial feedlots and meat processing plants.
In Kazakhstan, number of livestock increased in 2020
According to statistics for 12 months of 2020, the number of livestock in organized farms (agricultural enterprises and peasant / farms) increased in the republic:
- cattle by 8.2% and amounted to 3,616.2 thousand heads;
- sheep by 9.1% and amounted to 8,470.8 thousand heads;
- horses by 12.4% and 1,688.3 thousand heads;
- camels by 9.3% and amounted to 112.1 thousand heads;
- pigs by 3.4% and amounted to 330.5 thousand heads.
Modern high-tech enterprises for slaughtering and primary processing of livestock are being created in the country as part of the State Program for the Development of the Agro-Industrial Complex for 2017-2021, there are the following types of state support for meat processors:
1) reimbursement of part of the costs (up to 25%) of processing enterprises with investments for the modernization of existing and construction of new plants;
2) subsidizing the interest rate on loans for working and fixed assets;
3) subsidizing the amount of value added tax to procurement organizations in the amount of calculated VAT;
4) implementation of concessional lending within the framework of the Economy of Simple Things, including producers of meat and poultry meat.
In addition, there are concessional loans to agricultural producers through subsidiaries of the holding JSC NMH KazAgro.
Over 92 billion tenge allocated to subsidize development of livestock breeding in 2020
According to the Rules for subsidizing the development of livestock breeding, improving the productivity and quality of livestock products, budget subsidies are provided to domestic agricultural producers, individuals and legal entities at the expense of funds provided in the local budget for the corresponding financial year.
In 2020, 92.4 billion tenge was allocated from the local budget to subsidize the development of livestock breeding, increase the productivity and quality of livestock products, which were fully utilized.
As part of anti-crisis measures, in April 2020, an additional 10.5 billion tenge was allocated from the republican budget for this program, which were also spent.
In addition, due to the lack of funds in local budgets in December 2020, additional funds were allocated from the reserve of the Government of the Republic of Kazakhstan to subsidize the livestock industry in the amount of 12.3 billion tenge, which were also fully utilized.
In addition, subsidiaries of JSC NMH Kazagro (JSC Agrarian Credit Corporation and JSC Fund for Financial Support of Agriculture) provide concessional loans with a long maturity for peasant farms, in particular, for cattle breeding:
- for the purchase of imported pedigree, purebred cattle;
- domestic breeding, purebred cattle;
- imported / domestic outbred cattle (meat line of activity);
- to replenish working capital;
- for the purchase of agricultural machinery and equipment.
The maximum loan amount is up to 70 million tenge, the lending rate is from 4% per annum, the loan term is up to 15 years.
For sheep breeding:
- for the purchase of breeding stock of small cattle;
- to replenish working capital;
- for the purchase of agricultural machinery.
Maximum loan amount — up to 30 million tenge, loan rate — from 6% per annum, loan term — up to 10 years
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