20 december 2022
5 min

Who will win in the war between processors and farmers?

Who will win in the war between processors and farmers?

Disputes between Kazakh farmers and crop processors will be eternal. The Union of Field Farmers decided to complain once again to the Ministry of Trade for lobbying the interests of the oil refineries. Who will win in this endless war? The World of NAN reporter tried to find the answer to this question.

The essence of the dispute is simple: the farmers want to export the crop at a higher price, and the processors want to get the raw material at a lower price. Both sides want to make money. But the only difference is that the farmers do not claim the added value of the processed product, and the latter is pressured by the government in terms of prices. It is clear that the culprit for the squabble is the government, which is afraid of price increases and the subsequent dissatisfaction of the people.

But the actions of the authorities are sometimes incomprehensible. Take flour, which, according to monitoring agencies, has risen by 40% over the year. Granted last year the raw materials were expensive, but this year it is less, and the prices have not fallen. It's strange, isn't it? But even stranger is that flour exports have increased by 28%. Do you want another fun fact? QazTrade reimbursed flour exporters by 1.5 billion tenge. That is, the state itself supports the export of a product that is growing in price. A genius solution, shows a bright future for Kazakhstan.

Why is it happening? Simply because the President stresses all of his instructions on the processing of crops. Here is a quote from his Address this year, "The time when you could just sell grain and livestock is a thing of the past". That is why all the ministries are trying to toady up to their superiors by promoting the activity of processors. But who will think of the farmers? The Ministry of Agriculture?

No! The Ministry of Agriculture will give subsidies to farmers with the condition of selling raw materials to domestic processors, plus the processors are reimbursed for exports. And the export of crops is limited, by imposing duties. Farmers are literally caught in a vice. And so the winner of this war is now clear. But what can be done?

Such actions can make domestic processors become brazen and reduce the cost of agricultural raw materials. There are plenty of barriers, so why not get bold? And complaints and letters to farmers will not help. But by uniting we can think of something! For example, crop growers can reduce the amount of crops of processed products in Kazakhstan. The reduction of crops will lead to low supply and higher prices. Everything seems simple, but the neighbors with their harvest can ruin everything. And how to manage it on the national scale? The question is still open.

For cattle breeders it is even more difficult. Of course, it is possible to establish processing by farmers, like Europeans, and work peacefully, but who will do it? Only large farms can afford it. But do they need it? It is clear that they do not. Although, in the long run, independent processing is a very profitable venture. Why? You grow raw material, process it, sell it, and earn money. And no one bothers you? It may sound easy, but when has it ever been easy for farmers?


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