Cultivation and processing of oilseeds in Kazakhstan is getting more perspective for development and investment. Year by year, the planted areas under the main oilseed crops continue increasing. The important factor to see is also the government support which attracts interest of producers. Hereinafter, the Deputy Director of the department of agro-industrial complex and food industry at the National Chamber of Entrepreneurs of the Republic of Kazakhstan "Atameken", Erbol Eseneyev told APK-Inform journalists about development of the reporting market segment and the expected prospects.
Reference:
The department of agro-industrial complex is a structural subdivision of the National Chamber of Entrepreneurs Atameken, which engaged in information-analytical, documentary organization of the National Chamber; development of the consolidated opinions of entrepreneurs for solution of the key issues in the sphere of agro-industrial complex; participation in activities of the National Chamber on proposal, protection of the rights and legitimate interests of entrepreneurs; assistance for creation of favorable legal, economic and social conditions for enterprising activity in the sphere of agro-industrial complex and food industry.
- Erbol Erkenovich, how do You estimate the harvest of oilseed crops in Kazakhstan in 2016? How has the croppage changed in comparison with last year? In general, what dynamics of oilseeds production in Kazakhstan is observed during last decade?
According to the statistics, total croppage of oilseeds in 2016 totaled 1.9 mln tonnes that exceeded the year ago level by 0.4 mln tonnes (or 27%). In general, the dynamic growth and a positive tendency for increase in production of oilseed crops is evident. Thus, in comparison with 2006 production rose by more than by 4 times. First of all, it is due to that fact that oilseeds became an export-oriented product which make an interest for Chinese business-partners.
- What are the forecasts for 2017/18 planting season? Will the planted areas be increased and due to what crops?
We are planning to seed about 2.1 mln hectares under the main oilseed crops – sunflower, rapeseed, safflower, flaxseed. Besides, the Ministry of Agriculture and local councils have signed memorandums on diversification of acreages. Besides, the memorandums intend an expansion of oilseeds’ acreage and reduction under the grains by 2020.
- Tell us please in detail about the consumption structure of oilseed crops, in particular sunflower and flaxseed? Whether does the domestic production cover demand?
According to regional Deraptments of Agriculture it has been collected 2.4 mln tonnes of oilseeds that in generally exceeds internal requirement, the lack of product is observed only in the Karaganda and Jambyl regions. This deficit is covered by interregional exchange and import. The analysis of agriculture shows that the volume of oilseeds produced, except flaxseed, is traditionally focused on domestic processing. At the same time, some enterprises which are engaged in export activities and also some agricultural producers realize part of it’s production for export income which promotes their development and economies in general. Considering the above mentioned, the Ministry of Agriculture provides the policy of security supplies the processing enterprises with raw materials of own production. Thus, within the program of subsidizing priority crops farmers are offseted the expenses of standard subsidies for delivery oilseeds at the processing plant by 100%.
- How far does sunflower and flaxseed processing work in Kazakhstan? What capacities for processing oilseeds do exist now, and what is the approximate ratio of the processed and export volumes of these crops?
It should be noted that nowadays Kazakhstan actively increases production of oilseed crops. And the government’s priorities towards oil sector is explained by high production and processing potential not only in the domestic market, but in global one. During last five years Kazakhstan has strengthened it’s positions as oilseed producer, while the sunflower is indisputable leader in volumes produced each year. Flaxseed and rapeseed are also perspective crops in the nearest future but processing of flaxseed today isn't carried out. So far the production capacity of the operating plants is 1`740 thsd tonnes per year. Besides, according to entrepreneurs, the works on construction of 5 new plants with the production volume of 1`550 thsd tonnes per year are being conducted. According to official data, production of sunflower oil in 2016 reached 246.1 thsd tonnes among which 32.4 thsd tonnes were exported.
- How do You estimate demand for the Kazakhstan sunflower oil on the global market? What are the prospects for the expansion of sales markets?
According to official data for the last five years (2012-2016) the exports of sunflower oil increased by 14% (from 28.4 thsd tonnes to 32.4 thsd tonnes), while the traditional importers were Uzbekistan, Kyrgyzstan and Tajikistan. At the same time, today the Kazakhstan sunflower oil is in great demand in the markets of other countries due to it’s natural qualities. In particular, great interest to the production revealed China. Thus, in 2016 China has already imported 11.6 thsd tonnes of sunflower oil what is 35.8% of the total export amount. And in the nearest future, China is planning to increase this index.
- In Your opinion, what are the main difficulties producers face while working on the domestic market of oilseed crops, in particular, sunflower seed?
According to our manufacturers, the main problem of the producers is lack of raw materials. In this context, we consider it’s necessary for the Minister of Agriculture to streamline all the works of planted areas structure and make diversification of the branch with corresponding financing for all procedures.
- How would You comment the oilseed market situation since the beginning of 2016/17 MY? What factors did influence the purchasing prices formation in the beginning of the season?
The key factor impacting the prices is the demand existed for one or another segment of agriculturals. In this context oilseeds are being more export-oriented thus market prices for them are higher in comparison with grains.
- Taking into account the amplifying interest from China and other countries in the oilseed branch of Kazakhstan, how do You estimate the investment appeal of this economy segment?
As you could note earlier, we have sufficient processing facilities for production vegetable oils that’s why there is no need to invest in construction of the new plants. At the same time, volumes of exported vegetable oils are increasing annually along with that we do have the lack of raw materials. In this connection, investment in oilseeds production looks quite perspective. It must be noted also that the government provides sufficient support for oilseeds production.
Interviewed by Anna Bulatova, APK-Inform Agency
