russia is dissatisfied with Kazakhstan’s decision to ban the import of Russian grain

Russian grain exporters have called the ban on wheat imports imposed by the Kazakh authorities an unfriendly measure towards Russian agricultural producers. The head of the Union believes that a different path could have been taken. Meanwhile, Kazakh grain producers are satisfied with the decision of their government. They stated that there was no other way to get rid of the non-market pressure on the sector.”

The ban on the import of Russian grain to Kazakhstan has been extended until the end of 2024. As the Ministry of Agriculture of Kazakhstan stated the day before, despite the current bans, Russia does not stop importing grain into the country and smuggles it. In the first five months of 2024, more than 1 million tons of wheat were smuggled into the country from Russia.

The Union of Grain Exporters of Russia commented on Kazakhstan’s tightening. Eduard Zernin, the head of the Union, told RG.ru that they do not know how much Russian producers have illegally exported to Kazakhstan. However, according to him, the measure is a source of annoyance for their Russian colleagues.

“It’s a shame that behind the loud rhetoric of ‘fighting smuggling’ there are clearly unfriendly actions towards Russian agricultural producers aimed at banal restriction of competition,” said the head of the Union.

In his opinion, this problem can be solved in a different way. For example, by analyzing and comparing the work of suspicious grain producers with the average yields in a particular industry in Kazakhstan. This analysis would help identify those who violate the law. Then Kazakhstan simply needs to take professional action on these issues.

“If this is not done, it means that someone does not benefit from it,” Zernin suggested.

Commenting on the planned increase in the tariff for the transit of Russian grain through Kazakhstan, he noted that the measure would exacerbate the security problem in Asian countries.

Meanwhile, Kazakh grain producers are grateful to the authorities of their country for the decision to close grain imports from Russia. And they state that it was not easy to do so.

“Our initiative has found its application. Wheat imports are completely banned by all means of transportation. I would like to note the increased political will of our government. Because for business, this document is purely technical, while in the inter-country dialogue it is a rather difficult decision and it is great that we were able to do it,” said Viktor Aslanov, Chairman of the Union of Field Growers of Kazakhstan.

There is simply no other way to “get rid of non-market pressure on the sector,” he said.

“Because we have been under pressure not from Russian products, but from the fact that for 8 years now, Russian and other agricultural products have had their competitive advantages primarily due to the devalued ruble. It is clear that it is very difficult to turn the economy around, almost impossible, but let’s at least try this way…

Grain producers have asked to limit imports because they cannot compete with Russia, and Kazakhstani goods are stale. This year, the situation has been exacerbated by the fact that all the leading Kazakh buyers have had a good harvest themselves. Exports in the next trading season will decline quite a bit. Supply will be high, both in Russia and Kazakhstan. Prices will be low, including export prices,” Aslanov said.

At the same time, he noted with regret that the Kazakh authorities are planning to impose a duty on the export of grain and other crops. This decision will lead to a significant reduction in the supply of Kazakh wheat abroad.

“If we introduce the duty now, even if we take farmers’ profits out of the equation, the idea will not be realized. Because exports will decline under the duty, no one will want to export under such conditions. As for duties, the Union does not support this decision. The decision looks especially ridiculous because we recently asked the government to restrict imports. And now they are restricting our exports as well,” said Viktor Aslanov.

Tags: Russia, Kazakhstan, wheat, restrictions