How much will wheat of the new harvest cost?

Grain Union has calculated the approximate cost of grain in Kazakhstan. And shared its analysis in the event of an export duty imposed by the government, World of NAN reports with reference to the ZSC.

According to the analysts of the Grain Union, the total cost of wheat in Kazakhstan will be higher than the production cost in Kazakhstan - $252 per ton. The cost was taken into account based on the investment of farmers per hectare. (Included costs for SFW, summer chemical treatment and harvesting).

If sold domestically at $294/ton, the farmer's income would be formed below the $42/t calculated at production cost. The domestic price is formed taking into account the export price (DAP Saryagash) and the trader's purchase price with a margin of up to 10 dollars.

In the case of official introduction of export duty, income of grain producers of Kazakhstan will be significantly reduced, profitability of Kazakh wheat production will be significantly lower than that of Russian wheat. This can lead to bankruptcy of Kazakh farmers.

"Kazakhstan actually unofficially introduced an export duty in the form of an obligation of exporters to sell wheat to the ProdCorporation at a fixed price (10% of the planned export volume). At current prices, the difference between the purchasing price and the fixed price is up to 54,000 tenge per ton or $12-14 per ton of exported wheat," added the Grain Union.

It will be difficult for traders to raise the price because of the small geography of exports. In addition, the formation of export prices DAP (Saryagash) has a significant impact on the low solvency of the main buyers of Kazakh wheat (Iran, Uzbekistan, Kyrgyzstan, Tajikistan, Turkmenistan, Afghanistan).

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