Focus: Agriculture

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May. 5, 2013

Paramount to the growth of the non-oil sector, the country's agriculture sector is receiving strong government support that will see output expand in the coming years.

The sector has also been the recipient of a significant portion of the total investment in the country over recent years—it received 3.4% of the total in 2011, above construction with 1.8% and ICT with 2.4%. Government efforts are also being made to boost the mechanization rate, including the recent establishment of Agroleasing, a company that leases agricultural machinery imported into the country using state funds. According to the latest Azstat figures, there were 21,400 tractors in the country in 2011, up from 21,300 in 2010. There are a further 1,800 grain combines.

GOVERNMENT SUPPORT

Support for the agriculture sector was underlined in 2007 when the government began a subsidization program in order to improve efficiency. In 2012, this resulted in the payment of AZN573 million to agricultural producers. Further measures were also adopted, such as the provision of AZN40 per hectare of arable land granted to farmers for fuel and lubricants, and a further AZN40 per hectare of land provided to rice and wheat producers. In addition, the government subsidizes 50% of employed mineral fertilizers and 50% of the cost of highly productive cattle, with the remainder financed by the buyer over a period of three years. At the heart of government support for the sector, however, is Agroleasing. The company annually purchases and imports agricultural machinery, technological equipment, and mineral fertilizers through funds allocated from the state budget. “These are then provided to farmers and rural entrepreneurs on a concessional basis, and consequently these new technologies and equipment contribute to increased productivity in agriculture," Ismat Abasov, Minister of Agriculture, told TBY. The government has also overseen the initiation of 10 projects in cooperation with international organizations such as the World Bank and the International Fund on Agricultural Development (IFAD) between 2003 and 2012.

MEAT & ANIMAL PRODUCTS

There have been slight increases in Azerbaijan's livestock population in recent years, with poultry, sheep and goats, and cattle and buffaloes the largest herds. According to 2012 Azstat statistics, there are currently 2.68 million head of cattle and buffalo, of which there are 1.16 million cows and 128,400 dairy buffaloes. There are 8.56 million head of sheep and goats and 23.16 million poultry.

Meat production has also steadily increased in recent years, and reached 263,692 of carcass tons in 2011, the majority of which was produced by private owners. This was up from 253,772 in 2010 and 237,078 in 2009. The Aran region is the focus of the industry, producing 78,273 carcass tons in 2011, with the Guba-Khachmaz region the second largest producing region with 30,647 tons in the same year. In terms of animal products, 1.62 million tons of milk was produced, 1 billion eggs, and 16,200 tons of wool.

FRUIT & VEGETABLES

Following a bumper year in 2009 in terms of land sown, 2010 came in with only 1.58 million hectares sown compared to 1.7 million the year before. However, 2011 saw a revival with 1.6 million hectares sown; 967,000 with cereals, down only slightly from 968,000 in 2010; 66,900 with industrial crops, up from 52,600 in 2010; 179,700 with potatoes, vegetables, watermelons, and melons, up from 178,100 in 2010; and 394,300 with fodder crops, up from 384,500 in 2010. The rapid growth of private producers is also reflected in these figures, with 1.52 million hectares of the total 1.6 million hectares sown by private owners, family farms, and households. In terms of crop production, cereals and dried pulses represent the largest output, with 2.46 million tons produced in 2011. The next largest crop in the same year was vegetables, with 1.22 million tons produced, followed by potatoes with 938,500 tons produced. Additionally, 478,000 watermelons and melons were produced, as well as 252,000 tons of sugar beet, 66,400 tons of cotton, 19,600 tons of sunflowers for seeds, and 3,600 tons of tobacco.

FISHERIES

Azerbaijan's rich coastline and rivers yielded 47,025 tons of fish in 2011, up from 45,315 tons in 2010. Of this figure, 45,500 tons were caught by individuals based on research carried out on households. A further 125.9 tons were caught by fisheries, 338.1 tons by lake and pond fishing, and 1,061 tons by quota fishing, below the imposed 2012 limit of 1,748 tons. Popular catches include sardines, herring, mullet, bream, and Arctic cisco. It is the sturgeon, however, that makes the headlines, with beluga caviar fetching between $5,000 and $15,000 a kilogram. Restrictions on sturgeon capture support both price and livestock numbers, with aquafarming becoming more common in the Caspian nation, which is also a strong supporter of a moratorium on capture among littoral Caspian nations. Caspian Fish Co. is the country's prime producer of caviar, and is also involved in preservation. By 2015, it plans to have released 150 million sturgeon fingerlings into the sea. Additionally, the government has spent AZN1.97 million on the preservation of marine life, up by AZN189,000 on the previous year. A large part of this was also spent on activities at artificial fish-breeding enterprises.

Moving forward, continued state support is likely to keep the agricultural sector in focus with the emphasis on private-sector development. “Our medium-term plan is to fully provide our population with food and agricultural products," said Minister Abasov, stressing the leaps and bounds the sector has made in recent years. “Today, we import some agricultural products, and at the same time a large variety of products—particularly fruits, vegetables, garden crops, and their processed parts—are exported from Azerbaijan." He also remains optimistic that the country is capable of more, concluding that “this growth is not exhaustive, and there is the potential for more in our country."

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