Proper state support measures will allow increase in production and reduction of prices - Head of the Union of Poultry Farmers of Kazakhstan

At the end of March, associations and unions representing agricultural producers of Kazakhstan made a collective appeal to the President of Kazakhstan Kassym-Jomart Tokayev. In it, the agrarians voiced proposals for necessary measures of state support for the development of the agricultural sector of the country, under the conditions of the coronavirus quarantine and the state of emergency.

We managed to get commentary on this subject from Ruslan Sharipov, the president of the Union of Poultry Farmers of Kazakhstan.

How do you estimate the impact of the coronavirus pandemic on poultry farming?

- We have 65 poultry farms, 34 egg factories, the rest produce broiler products. We continue to work same as before. We can't send workers home and quarantine them, because the poultry needs care every day. We're all working. For instance, there is a factory which is near Shymkent. Many workers of the factory live in this city. Now Shymkent is closed, so we have created housing for people, relocated them and created conditions for work. There are also poultry factories around Almaty. Specialists also live in the city. There are certain problems, but all this is solvable.

The biggest difficulties in poultry farming are related to feed grain. The situation in the market now is not easy. The farmers hold the grain before sowing, and the surplus will be sold later. The Prodkorporatsiya has a small quantity of forage grain of the 4th class, about 50 thousand tons, but it is expensive. And we have 70% of the prime cost is in the forage. If the feed is cheap, then our products will be cheaper - egg and meat. Besides the grain, we import breeding poultry, vaccines, vitamins and equipment. Today there are also certain difficulties with that. For example, it is difficult to transport breeding poultry, because planes do not fly. Lufthansa does not operate now, and most of our imports come from Europe. These are the problems, but we hope that the situation will get better.

What can you say about the collective appeal of agricultural associations to the President?

- As for the appeal, I think that all the points that are reflected in it are important for agriculture. Specifically, our sector needs grain first and foremost. The realization has decreased today, too. However, the Ministry of Agriculture is conducting work in this direction. In the coming days the state reserve will buy 7 thousand tons of products from us, the money has already been allocated. Therefore, the main issue is still concerns grain.

For reference: we would like to note that on 31 March President of the Republic of Kazakhstan Kassym-Jomart Tokayev made a statement on strengthening measures of support of citizens and business representatives during the crisis period, in which he instructed to support agricultural producers.

"Akimats and the Government (through the State Food Corporation) should establish a mechanism for the guaranteed purchase of products from domestic agricultural and processing enterprises at least 6 months in advance, ie introduce the so-called "forward purchase" or "buy under harvest". There is a need to define a clear mechanism of integration of enterprises along the entire chain - from the field to the counter and provide them with soft loans. Business, in turn, should undertake counter commitments to ensure production volume, preserve prices and maintain employment, etc.," the President instructed.

Financial support to the industry will also be increased by order of the head of state.

"70 billion tenge will be allocated from the budget and delivered to farmers through JSC "Agrarian Credit Corporation". The rate for end borrowers will not exceed 5%. I instruct to allocate an additional 100 billion tenge for these purposes within the framework of the programme "Economics of Simple Things". The final rate under this program has been unified across all industries and is 6%. First of all it is necessary to support small and medium peasant farms," the President said.

How do you assess the measures of state support of agriculture?

- An important point here is the collateral. We need money in our work every day, and money is "rooted" in our products. If there are no sales, the products remain in stock. Therefore, manufacturers constantly take loans to replenish working capital. Today we have been given grain through the Prodkorporatsiya for six months. But then again, we need a bank guarantee. And where can we get it? Not all factories can get a bank guarantee. It's difficult, but we are going to solve it step by step.

Significant government support can have a serious impact on the industry. For example, we provide Kazakhstan with 100% eggs, and about 60% for poultry meat. But we can increase the volume. We fully understand the current situation, so we do not reduce or stop production. If we are given soft loans or get subsidized feed, we will also be able to reduce prices for products, we will not reduce production.

Thank you for the interview!