TBY talks to Nurlan S. Tleubayev, President of the Grain Union of Kazakhstan, on the country’s important role in the regional and international grain trade.
TBY What is your grain export portfolio, and where are your main markets?
NURLAN S. TLEUBAYEV Through the Baltic Sea, we export to the Middle East, including Egypt and Saudi Arabia. We also produce wheat for export to Italy, Greece, and Turkey. Kazakhstan exports flour to countries such as Uzbekistan, Afghanistan, and Tajikistan, which represent our largest markets, and is also the number one exporter of flour in the world. Our exports to European clients depend on the price, but Central Asian countries only buy Kazakhstani wheat.
What effect will the Customs Union have on the grain trade?
It will have a negative impact on dairy, meat, and certain other products, because of the high subsidies in the Customs Union, with which Kazakhstani producers cannot compete. Competition in cereal production will increase minimally.
What is Kazakhstan’s export potential to the Chinese market?
China is the future market. Approximately 80% of Kazakhstan’s cereal production comes from three regions that are close to the Russian border, and these three areas represent 95% of Kazakhstan’s exports. In December 2011, the Iranian and Kazakhstani railway networks will be connected through Turkmenistan. Central Asia, Iran, and the Gulf are the main Kazakhstani markets right now, but in respect to the Chinese market, approximately 97% of China’s population lives far from Kazakhstan’s border. West China currently provides its own wheat for domestic consumption. In the future, however, the Chinese government wants to move 150 million people closer to the Kazakhstani border, and this will happen over the next 20 years. The Chinese market is not our priority now, but in 20 years it will become our largest market for wheat.
What is your involvement with the Grain Union of Kazakhstan?
After the government lifted the monopoly on the grain trade in 1992, private grain exporters emerged in Kazakhstan. To protect their interests, these private companies created the “Association of Exporters of Corn,” which in 1995 was renamed the “Grain Union of Kazakhstan”. I have headed this organization since 1998 as its president. Reduced state funding for agriculture led to a sharp decrease in cultivated lands in Kazakhstan. In 1998 private exporters were unable to buy enough grain for export due to the lack of a free grain market. In 1999, these companies began to invest in grain production by renting land and buying containers for grain storage. Members of the Grain Union of Kazakhstan are vertically structured private companies. They produce grain and oilseed on state property leased for 49 years. They also conduct the modernization of agricultural technology, employing US, Canadian, and EU machinery, and have storage and processing capacities.
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