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Agrarian year results: Yield growth and increased crop production

Sunday, 30 December 2018, 04:11:00

In the Address “Growing Welfare of Kazakh Citizens: Increase in Incomes and Quality of Life,” the Head of State paid special attention to the agro-industrial complex. In particular, it was instructed to fully implement the potential of the agro-industrial complex. How the President’s instructions are being implemented and how the year passed for the agrarian sector, read in the review material of РrimeМinister.kz.

According to the Ministry of Agriculture, the year 2018 was generally favorable for increasing yields and crop production.

Regional departments of agriculture report that the yield of grain crops in the initial weight was 15.1 centners per hectare, which is 0.6 centners per hectare or 3.9% higher than the level of 2017. About 9.5 centners of oilseeds were harvested from 1 hectare, of potato — 197.8 c / ha, of vegetables — 256.7 c / ha, melons and gourds — 236 c / ha, cotton — 26.4 c / ha, sugar beet — 304.4 c / ha.

The increase in yield contributed to an increase in crop production. Thus, the gross grain harvest in the initial weight amounted to 22.8 million tons of grain, which exceeds 2017 level by 759.9 thousand tons, or 3.4%. Gross harvest of oilseeds in the initial weight is estimated at 2,686.6 thousand tons, potatoes — 3,896.8 thousand tons, vegetables — 3,937.6 thousand tons, melons and gourds — 2,242.2 thousand tons. Also 350 thousand tons of raw cotton and 595.7 thousand tons of sugar beet were collected.

According to the Ministry of Agriculture, in 2018 in the republic, the sown area of ​​crops amounted to 22 million hectares, which is 170 thousand hectares or 0.6% more than in 2017.

Due to the systematic measures taken in the livestock industry, the share of cattle in organized farms increases annually and today amounts to 44.2% of the total livestock. For comparison, in 2011 this figure was 23.3%.

The volume of milk production only in organized farms for 11 months amounted to 1.4 million tons. For comparison, in 2015 they produced 900 thousand tons. Similar dynamics was observed in the production of meat in organized farms: 409.2 thousand were produced for 11 months, which is 6.9% more than in 2017.

In January-September 2018, exports of agricultural products totaled more than $2 billion. Including exports of processed products totaled $780 million. For 11 months 2018, 17.5 thousand tons of beef were exported, with a plan of 15 thousand tons.

In general, according to the Ministry of Agriculture, an increase in the volume of attracted investments in the fixed capital of agriculture is observed in the republic: over 10 months it was 18.4%, and in food production — 33.7%.

 

Main Task — Full Realization of Potential in Agro-Industrial Complex.

Planned measures for the implementation of the Head of State's Address can be divided into three groups: system, industry and specific investment projects.

As part of systemic measures, mechanisms are being improved and the volume of state support is increasing. Previously, the entire state support amounted to 240 billion tenge plus 60 billion tenge of a budget loan, which at the year-end returns to the budget, these are, in fact, repayable funds. On the instructions of the Head of State, an additional 100 billion tenge will be allocated for the State Program annually as well as 200 billion tenge to solve the problem of affordable lending to priority projects of the agro-industrial complex. Thus, the volume of state support will be increased two times.

These funds will be directed to the implementation of the following tasks: stimulating the introduction of modern technologies in the industry, updating agricultural equipment, increasing the availability of financing agribusiness entities, including by increasing the volume of investment subsidies, and cheapening and expanding the availability of bank loans both for working capital and investment targets.

In addition to increasing the volume, it is planned to change the direction of subsidies. In particular, inefficient subsidies will be reduced. Therefore, the main approaches to their change have been developed.

According to the results of the reform, out of 54 types of subsidies, 34 subsidies will remain.

At the same time, it should be understood that it is impossible to rely only on subsidies. The industry is large, it is impossible to cover all with state support measures. Therefore, it is necessary to attract other financial institutions, use the existing banking infrastructure.

For this, the Ministry of Agriculture in 2018 resumed subsidizing interest rates on loans for fixed assets, as well as leasing of agricultural equipment and agricultural animals. Due to this, for 10 months 2018, 2,752 units of equipment for about 50 billion tenge were leased. For comparison, for the entire 2017, equipment was leased out by 40.2 billion tenge, or 19.8% less. In general, in 2018 about 60 billion tenge was directed to leasing programs.

In addition, the approaches to investment subsidies have been changed. This gave impetus to the initiation of new investment projects. If in 2017 only Kazagro approved 40 large investment projects for 45.1 billion tenge (the average project cost was 1.13 billion tenge), then from the early 2018 — 76 projects worth 104.5 billion tenge (average project cost 1,38 billion tenge).

In the future, in these areas, the volume of state support will only increase.

Now the Ministry of Agriculture has begun to expand and engage other financial institutions in financing the agricultural sector. Planned reorientation of second-tier banks from lending to other sectors to lending to the agro-industrial complex.

To this end, a package of changes in legislation has been formed, providing for the improvement of existing and introduction of new financial instruments, such as an agrarian receipt.

Measures are being taken to protect the domestic market and expand foreign markets. To this end, systematic work is underway to harmonize veterinary and phytosanitary requirements, harmonize legislation in the field of technical regulation, integrate into the WTO, the EAEU, and enter the markets of neighboring countries.

On behalf of the Head of State, the reform of agrarian science and education has begun, setting them up for business needs and technology transfer. The work is conducted in three directions — education, science and the system of dissemination of knowledge.

As part of industry measures, long-term industry programs have been developed for the main areas of the agro-industrial complex. These are programs for the development of meat and dairy cattle breeding, poultry farming, and irrigated land.

For example, the meat program is based on small and medium-sized farms. For its implementation, a special preferential credit product “Sybaga” has been launched. In 2018 the plan has already been exceeded, despite the fact that its implementation began only in the second half of the year. To date, about 600 farmers have received loans.

According to the poultry program, it is necessary to increase the level of poultry meat production by three times (from 200 thousand tons to 700 thousand tons) and thus ensure import substitution. This year the project “Makinsk Poultry Farm” has been launched with an annual capacity of 60 thousand tons. This is the largest project at this stage in the poultry industry. Similar work is being done on other programs. For regions, measures and indications of sectoral programs are cascaded into regional programs.

In addition to the implementation of systemic and sectoral measures, the Ministry of Agriculture planned and has already begun to implement large investment projects.

The ministry intends to attract multinational companies with its export markets, which invest not only capital, but also new production and processing technologies, introduce new approaches to management, and the ability to export Kazakhstani agricultural products under the sign of recognized global brands.

For example, there is a cooperation with the Italian company Cremonini Group on the construction of an ultra-modern meat processing plant, with the Chinese corporation CITIC Construction on the creation of a joint investment fund and irrigation, with the Chinese company Golden Camel on the processing of camel milk, with the British Dunbia on cooperation in the livestock industry, with the American AGKO for the construction of a pig farm and the development of aquaculture, with the German CLASS for the production of agricultural machinery, with Korean Hyundai Corporation for the production of tractors in Kazakhstan.

In order to introduce the best practices of the development of agrarian science and expand international cooperation, work is underway to form a pool of modern scientists by sending at least 300 domestic scientists for internships and training to leading foreign scientific centers for a PhD degree, conducting joint research.

In addition, it is planned to introduce a benchmarking system for all agricultural research institutes —  the orientation of each to global research organizations, as well as the introduction of English as a working language; requirements for scholars on publications in international scientific journals.

Taking into account international experience in order to impart practical character to domestic agricultural science, regional research-and-production research centers are created in the form of agropolygones, agroparks and agrocenters on the basis of subsidiaries of the National Agrarian Science and Education Center.

On the basis of the centers being created, work will be organized on introducing the best international experience in Kazakh science and production, including by attracting reputable foreign experts, conducting research on the most efficient technologies in the context of regions and agro-climatic zones, demonstrating the results, and organizing the transfer of knowledge to agricultural producers.

In the framework of this work, some organizationshave been created:

  • Agro-park “Kokshetau” with five agricultural centers in Akmola, East Kazakhstan, Kostanay, Karaganda and Pavlodar regions engaged in grain, fodder production, industrial and oilseeds;
  • Agropark "Kaskelen" with the inclusion of four agricultural centers in Almaty, Zhambyl, Turkestan and Kyzylorda regions in grain, fodder production, cotton, rice, fruit and vegetable growing;
  • Four agrocenters in the form of advisory and consulting groups in Akmola, Almaty, West Kazakhstan and Aktobe regions in meat and dairy cattle, sheep and horse breeding.

 

Managing Industry by Introducing Flexible Standards and Attracting “Gray Heads”

In order to implement the best research experience in the framework of the International Science Center being established, it is planned to attract gray heads — reputable foreign scientists. The consortium created by the NASEC NJSC with the National Center for Biotechnology and the Scientific and Production of the Grain Economy named after A.I. Barayev began the search and attraction of leading scientists, the introduction of modern standards into the existing research institute system.

Thus, in 2018 research organizations of the NANOC group attracted 31 foreign scientists, including 7 from the PRC, 1 from the USA, 1 from Moldova, 1 from Holland, 3 from Germany, 2 from Turkey, 9 from Russia , 2 from Japan, 2 from South Korea, 1 from Belarus, 1 from Sweden, 1 from Iran.

In order to solve existing problems in the labor market and take additional measures to raise the standard of living of the population, the task is to stimulate mass entrepreneurship and provide employment.

In this regard, it is planned to continue the entrepreneurship project "Bastau Business."

The Bastau Business project is aimed at teaching entrepreneurial skills, including the principles of forming agricultural cooperatives, as well as supporting their business projects.

In addition, the implementation of the system’s activities of sharing knowledge for 2019 additionally provides for 592,685 thousand tenge. In this connection, at present, the Ministry of Agriculture is developing a concept for building a system of mass training for agribusiness entities. The approach to the provision of extension services for the subjects of the agro-industrial complex will be radically revised in order to increase the coverage of agricultural producers with new knowledge in the field of agriculture.

 

State Program of AIC — A New Round in Development of Agriculture in Kazakhstan

In February 2017, a new State Program for the Development of the AIC for 2017–2021 was approved. This was one of the most important events in the field of agriculture of the country. The program should become a significant incentive for domestic agricultural producers, give a new round to the development of agriculture as a whole and significantly increase export performance.

The first results are already available: the diversification of acreage has begun, the state program of the agro-industrial complex has increased food production, the level of processing and export of domestic agricultural products, created the necessary conditions for the emergence of agricultural cooperatives and the further development of agriculture in general.

In general, the Plan of measures of the State Program provides for the implementation of 20 measures for 2018, the achievement of 8 indicators and 41 performance indicators.

Actual values ​​for the achievement of indicators and indicators will be known in March 2019.

The main goal of the state program is to increase productivity in agriculture by 2.5 times. This indicator is decomposed into all regions. For the first half of this year, this figure increased by 9% over the same period last year.

For the first time in pilot mode, the implementation of the state program is managed using the project approach. For this purpose, a full-fledged project office has been created, which conducts operational control and spot monitoring of projects throughout their entire life cycle.

The entire state program in accordance with the standards of project management was decomposed into 10 sectoral investment programs for the development of the agro-industrial sector (meat, dairy farming, poultry farming, pig breeding, irrigated land diversification, sugar industry, gardening, etc.), 14 regional programs, as well as interaction with other government agencies for the development of 10 related subprogrammes for the development of the agro-industrial complex and rural areas (including “Aul — El Besigi”).

For each sectoral and regional program, there are clear indications for a 10-year period, as well as priorities and measures, and measures of state support with appropriate amounts and sources of funding are identified.

Thus, according to the Ministry of Agriculture, all the tasks of the Head of State, set in the Address "Growing of Welfare of Kazakh Citizens: Increase in Incomes and Quality of Life" and "Third Modernization of Kazakhstan: Global Competitiveness" are reflected in the State Program of AIC Development and are being actively implemented by the Government of Kazakhstan and specialized departments. As a result, we have tangible results in the development of the agro-industrial sector in 2018.


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