Agriculture in Kazakhstan: perspective areas

What is happening in the agricultural sector of Kazakhstan today? What are its promising areas and what will be beneficial for the peasants? This was the topic of our interview with Sergey Alexandrovich Tereshchenko, the first prime minister of independent Kazakhstan, the Chairman of the International Fund "Integration", the Hero of Labor, and the chairperson of the supervisory board of the largest poultry complex Ordabasy Kus.

- Some Kazakhstani Mass Media write that subsidizing in agriculture will stop. Since 2016, the Ministry of Agriculture has abolished the hectare subsidy; the program of subsidizing in livestock breeding has been changed. What areas will still be supported by the State?

- In Europe and the US, large subsidies for agriculture (fertilizers, seedlings, hectare subsidies) are allocated, for example, the estimation is around EUR 400 per hectare in the European Union. Our grants are small and allocated per hectare, as time has shown, they are inefficient, and since this February they are reconsidered, but not canceled. There are two reasons behind – low purchasing power and high prices for feed.

In general, the subsidies for accession to the WTO should stop, so we are now working on reducing costs and producing our own feed in order to reduce the prime costs.

The second area is production of expensive processed products. We produce what is in demand, while in the expensive segment, for example, in two years we managed to increase the production of sausage products.

B. Sagintayev the Prime Minister of the Republic of Kazakhstan recently announced that the State would subsidize exports. Our products are well represented in the Russian Market, with our highly marginal products we plan to access the UAE, China and Uzbekistan Markets. The third area, strangely enough, is manure processing, as well as poultry manure. The Ministry of Agriculture is ready to support those who are ready to produce fertilizer from cattle manure or poultry manure. Now we have already begun to fulfill this job, and in future, we will develop fertilizers for farmers and peasant farms. This is really appreciated and is of a great demand.

All these three areas are supported by the state.

- Based on the example of Ordabasy Kus LLP, the largest Kazakh farm business, it is clear that every agricultural entrepreneur has prospects for development. What would you advise them?

- We can produce 100 thousand tons of turkey meat. Kazakhstanis know and love our products, and we are not afraid that such production volumes will be idle. Currently, we want to take somewhat different approach – not to get into loans, this is a very serious burden on the business (about 3 billion repayable loans of the principal debt we paid within 6 years). The shareholders receive virtually nothing. Nevertheless, we trained an excellent staff, 400 specialists from the local population, and the consultants are the Israelis. Another way is to produce our own feeds, due to which we can earn good money. We came with this idea to the Minister, Mayor, and we plan to create cooperatives, unite landowners and produce forage, build poultry houses. Generally speaking, we have all the opportunities and assets for this: an incubator for which we will create our parent herd, a modern feed mill, a granary with a railroad heads with preliminary cleaning and drying for 30,000 tons of grain, as well as a slaughterhouse and a deep processing workshop for turkey meat.

Thanks to the production of feeds, we will be able to get 40-60% of profit. We run this model, and I think we will succeed, and within 5-7 years, we will be able to produce up to 100 thousand tons of meat per year. The main thing is that we have specialists and prospects.

Coming back to your question, I will put it this way – go ahead towards these goals and you will not fail!