Kazakhstan’s Wheat Exports Projected at Lowest Level in More Than a Decade

10.12.2019 13:00 "Agro Perspectiva" (Kyiv) — According to the report of the USDA Grain: World Markets and Trade (November 2019), Kazakhstan is typically the world’s eighth-largest exporter of wheat and wheat products, averaging over 7 million tons annually, mainly to its southern neighboring countries. Although generally lower yielding, the soft/semi-hard spring wheat produced is desired for its high protein levels and gluten content. It is ideal for making flatbread. Exports of durum, mainly shipped to Italy, Russia, and Turkey, represent less than 10 percent of Kazakhstan’s total wheat exports. Milling is also a large part of the Kazakh market as about half of the flour milled is exported. Uzbekistan is Kazakhstan’s largest market, accounting for nearly a third of its total wheat and wheat product exports. Afghanistan is Kazakhstan’s second largest market overall and represents more than half of its flour exports. Tajikistan is a growing market for Kazakh wheat grain exports. To the east, China’s highly populous, developing economy has also become a major growth market for Kazakh wheat. Despite its presence as a major global exporter, Kazakhstan faces many obstacles, such as logistics, tariffs, and competition. As a landlocked country, shipping to non-contiguous countries such as Tajikistan and Afghanistan proves challenging as it must be transported via rail through Uzbekistan, facing duties in both the transit country and the importing country. Similarly, shipments to Europe must transit through Russia. Furthermore, Uzbekistan has been growing its milling industry with the ability to produce flour at a fraction of the cost, rendering Kazakh flour less competitive in the region. The industry also faces TRQs and nontariff barriers, particularly in exporting to China. Over the last several years, Kazakhstan’s wheat area has trended lower as producers have diversified into other crops. This year specifically, weather has been an obstacle to Kazakhstan’s production and exports. Severe drought and late-season rain have negatively affected the harvest. Hence, Kazakhstan is projected to slip to be the world’s ninth leading wheat exporter this year, falling behind Turkey for the first time in more than 20 years. At 5.2 million tons, Kazakhstan’s projected exports (July/June basis) are the lowest since 2005/06.

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