Grain Prices Fell in Kazakhstan and Russia. How Will This Affect Tajikistan?
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Grain Prices Fell in Kazakhstan and Russia. How Will This Affect Tajikistan?

In February 2023, the average wheat prices in Russia and Kazakhstan fell by 23-53% compared to last year’s levels. And this may negatively affect the supply of grain to Tajikistan.

In Russia, the average price of soft wheat of the third class has dropped to $170 per ton, which is 23% lower than in February 2022. Durum wheat fell to $200, which is 53% less than in 2022, the Grain On-Line agency reports, citing Rosstat.

In Kazakhstan, according to , since the beginning of July 2022, the price of wheat has decreased from $400 to $190 per ton.

“The domestic market is under pressure from cheap Russian grain, part of which is imported into Kazakhstan illegally,” the report says.

According to industry associations of Kazakhstan, the volume of so-called “grey” imports reaches 1.5-2 million tons per year, and the total damage to the state is estimated at $500 million annually.

“According to information received from market participants, a significant share of smuggled grain is imported by road.

Imported wheat, without paying VAT, is issued to peasant farms and in the form of hidden re-export, without paying a transit tariff, it is sent to the countries of Central Asia,” the Ministry of Agriculture of Kazakhstan reports.

Therefore, Kazakhstan plans to ban the import of wheat by road for six months.  

In September 2022, Kazakhstan lifted all restrictions on grain exports. 

Due to the cheapness of grain, Russian and Kazakh producers say that it is becoming unprofitable to sell wheat abroad.

How does this threaten Tajikistan?

Entrepreneur Asror Madaminov from the Sughd region is not happy about the sharp drop in grain prices in Kazakhstan and Russia.

In his opinion, because of this, they may impose a temporary ban on exports in the hope of rising prices in the coming months, and as a result, there may be failures in the supply of grain to Tajikistan. And this is undesirable for flour mills.

“It’s good when prices come down. But there is also a downside. We need stability in supplies,” the entrepreneur said. 

Source: Asia Plus