Pending Decision: The Ministry of Agriculture of Kazakhstan Yet to Support Introduction of Grain Export Duty

 

Kazakh authorities have announced an extension of the wheat import ban by all modes of transport until the end of the year. This decision was made without exception, even for key sectors such as milling, poultry, and livestock enterprises, which were previously allowed to import grain. This was disclosed in a press release from the head of the government following the meeting of the Interdepartmental Commission on July 26.

 

Experts emphasize that the lack of access to Russian grain will severely impair the competitiveness of local millers and poultry farmers. According to them, without access to inexpensive raw materials, businesses will not be able to compete in either external or internal markets.

 

In light of these challenges, the possibility of introducing export duties on a wide range of agricultural products is being considered, which should prevent price increases for local grain after losing access to Russian resources. Similar measures are already in effect in Russia for wheat, barley, and corn, and the duty on sunflower seeds, introduced in 2023, has led to a decrease in domestic market prices by the amount of the duty — 100 euros per ton.

 

Preliminary estimates suggest that the export duty on wheat will be set based on current market conditions and grain prices in Russia after the start of the harvest campaign. The initiative to introduce such a duty comes from the Ministry of Finance of Kazakhstan. However, the Ministry of Agriculture has not yet supported this proposal, stating the need for more thorough analysis in cooperation with industry associations and unions.

 

At the moment, the decision on introducing export duties remains unadopted. The Ministry of Agriculture is focusing on the potential negative consequences for the industry and the financial state of agricultural producers. After consultations with interested parties, a final position will be formed and presented to the Ministry of Finance for further consideration.