A press conference of farmers was held in Astana, demanding the abolition of the export duty imposed on sunflower production, Ulysmedia.kz reports.
They said that the tax, introduced in February 2023, has led to the fact that sunflower cultivation has become an extremely unprofitable business.
“Either remove the tax or we will stop planting sunflowers forever,” they said.
The decision to introduce an export duty on the export of sunflower seeds in the amount of 20% of the contract value or at least 100 euros per ton was made unilaterally, without taking into account the opinion of domestic sunflower producers.
“The main purpose of introducing the duty was to provide raw materials to local sunflower oil producers to stabilize domestic prices. Subsequently, government agencies expanded it, pursuing the goal of increasing the capacity utilization of processing plants. In fact, the export duty has become an additional tax on the income of sunflower producers. The experience of the Russian Federation, which the initiators of introducing the duty refer to, is not indicative for Kazakhstan. Russian sunflower producers, with a consistently high level of government support and a favorable sunflower cultivation zone, have much higher yields and profitability. Therefore, the withdrawal of part of their income in the form of an export duty is not as critical as for Kazakh farmers,” said the landowners.
They added that weather and climatic conditions and regular problems with the provision of state support do not allow achieving high yields and, accordingly, high profitability of production, in order to impose an additional tax on Kazakh farmers on income from sunflower exports
“The development of local processing today is due to a reduction in the income of domestic farmers. The increase in production volumes and subsequent export of raw sunflower oil does not significantly affect the provision of the domestic market with its own raw materials for the production of finished products - refined oil. Thus, since the beginning of the export duty, the volume of exports of Kazakh crude oil has increased, and the assortment of Russian sunflower oil on store shelves in Kazakhstan has increased, displacing the products of Kazakh factories,” say the farmers.
They added that the development of local processing is carried out both at the expense of the income of domestic farmers and at the expense of the income of the population.
In fact, the loss of income from lower export prices for butter is compensated by domestic prices and the population of Kazakhstan.
“When introducing the export duty, government agencies did not familiarize the business community with indicators for achieving their goals and objectives. For example, what indicators are planned to be achieved in the production of crude oil and refined oil (finished products), what measures will be taken to provide raw materials to local producers of finished products - refined oil, mayonnaise, margarine, etc., what measures will limit the export of crude oil and stimulate the export of finished products - refined oil. In such a situation, without establishing specific goals and objectives, without defining indicators for their achievement, it is not difficult for government agencies to report on the effectiveness of the export duty. Any positive change in production volume or change in domestic prices is presented by government agencies as an achievement due to the imposed duty. Despite the fact that such positive changes are likely to occur due to the current market conditions, and not due to the effect of the export duty,” say landowners.
Farmers emphasized that they are interested in the product remaining in the country.
“But when the situation is such, when the market is unfair, it is unnecessary to talk about the development of the industry and diversification of crop production. Such market restrictions have hit farmers so hard that no farmer knows what to grow next year. Sunflower used to be profitable. Nothing is clear now,” said the landowners.
They expressed hope that the government would hear their voice.
Let us note that earlier the Ministry of Agriculture announced low yields in Kazakhstan.
This year, the harvesting campaign from the first days turned out to be difficult for the farmers of the Kostanay region - heavy, prolonged rains significantly spoiled not only plans for a rich harvest, but also the statistics of agricultural officials, who threatened that despite the circumstances, four 4 million would be collected from the Kostanay fields tons of wheat.
Farmers claim that while local authorities and the relevant ministry were deciding whether or not to introduce a state of emergency, they had already practically lost their harvest. A Ulysmedia.kz correspondent went to the field and made sure that wet grain actually turns into fodder, that is, it can only be used as livestock feed.