Export Duty in Russia Opens New Horizons for Kazakh Flax

Russia plans to introduce a 10% export duty on oil flax. According to analysts, this decision will create significant advantages for Kazakh exporters, especially in the key Chinese market. Yevgeny Karabanov, Head of the Analytics Department of the Grain Union of Kazakhstan, noted that this measure would become a turning point in regional agricultural trade.

The news that the customs subcommittee had approved the introduction of the duty initially appeared in the Interfax agency, although the exact timing of its implementation remains unknown. According to Interfax, the initiative came from the Oil and Fat Union, which aims to stimulate domestic processing of oilseeds.

Karabanov emphasized that oil flax remained one of the few grain and oilseed crops in Russia not subject to export restrictions. Due to its high profitability, Russian farmers actively expanded sown areas for this crop, seeing it as a promising export commodity. Expert estimates suggest that in 2025 Russia plans to harvest about 1.2 million tons of flax from an area of more than 1.7 million hectares.

The expert noted that processing capacities for flax, both in Russia and Kazakhstan, remain insignificant. Domestic consumption of flaxseed oil is minimal, while China, the main buyer, is interested in importing raw materials rather than finished products. A similar situation is observed in EU countries, which also have their own processing plants. The position of Russian flax in the EU market is further complicated by high duties. From 2026, the duty on Russian flax in the EU will rise from 20% to 50%, making its export to Europe economically unprofitable.

At the same time, Kazakh flaxseed oil cannot compete in the European market due to high logistics costs. All this has led to a significant drop in flaxseed oil exports from both countries. For example, in the 2022/23 marketing year, Kazakhstan exported 15.3 thousand tons of flaxseed oil, while in the 2023/24 MY this figure fell to 1.8 thousand tons.

Karabanov believes that after the introduction of EU duties, China will remain the main export destination for Russia. However, in this market, Russia will face tough competition from Kazakhstan and Canada. Interestingly, in 2025 Kazakhstan sharply increased sown areas for flax by 55%, reaching 1.35 million hectares. The country’s harvest is expected to reach 1 million tons.

The introduction of the Russian duty opens new opportunities for Kazakh producers not only in Europe but also in China. Ultimately, according to the expert, the introduction of the duty may lead to a reduction in flax acreage in Russia and create ideal conditions for further growth of production in Kazakhstan and Canada.