Kazakhstan seeks to rebuild beef production

ALMATY – Kazakhstan has resolved to become a meat export power by the year 2020. Currently, the country cannot boast that it has "surplus" beef for export, but authorities expect that in five years Kazakhstan will be able to produce as much as 60,000 tonnes of beef per year for export – and 180,000 tonnes by 2020.

Officials launched the initiative to increase the country’s beef export potential to support the State Programme for Livestock Development, adopted in April. They plan to allocate about 130 billion KZT ($875m) to the project during the program’s first five years.

‘We have failed in livestock breeding’

Over the past 20 years, the number of cattle in Kazakhstan has fallen from 9.7m to 6m, according to the Statistics Agency. Annual production plunged to 396,090 tonnes in 2010, down from 709,600 tonnes in 1990.

"In 1990, Kazakhstan exported 180,000 tonnes of meat. And last year it was a tonne at best!" complained Aigul Ahmetzhanova, deputy executive chairwoman of KazAgro National Holding Company, which has undertaken the project to increase meat production.

Meat imports, meanwhile, have grown more than three-fold. In 1990, the country imported 6,000 tonnes and in 2011 about 20,000 tonnes.

After the Soviet Union’s collapse, cattle herds and poultry flocks shrank drastically, Isa Abzhappar, executive director of the Meat Union, an association of entrepreneurs, said.

The industry can meet only domestic needs, she said.

"We have failed in livestock breeding, and now are slowly climbing out of this hole,” she said.

The programme should have been implemented earlier, Abzhappar said. “If we had waited another few years, it would have been virtually impossible to revive animal husbandry."

"In our 20 years of independence, we’ve had great economic achievements, but not in animal husbandry, which is an industry that was historically a part of Kazakhstan,” said Alexander Solyulev, a board member of the Meat Union, agreed.

"As a result, animal husbandryin Kazakhstan seriously lags behind global rates,” Solyulev continued. “A little bit longer and we could become a 100% meat importer.”

Individual farms dominate

One of the key problems affecting beef production in Kazakhstan is that 82% of the cattle are concentrated on small-scale individual farms.

"In Kazakhstan’s case, non-specialised, under-productive small farms, which should be serving only their owners’ needs, became the main suppliers of meat products," said Ahmetzhanova. "In foreign markets, small individual farms’ products are uncompetitive.”

Only 18% of the country’s cattle are found on larger-scale, internationally competitive farms.

Kazakhstan’s percentage of pedigree livestock is also quite low – 2%, compared to about 80%, 75% and 72% in the United States, Brazil and Argentina, respectively, said Rabiga Tokseitova, director of livestock breeding and veterinary safety in the Ministry of Agriculture, said.

Among other pressing problems is the cattle’s low meat yield, which breeders blame on systematic difficulties in feed production, poor veterinary care and outdated breeding methods.

Natural advantages will help industry develop

"Despite the unfavourable picture of the last two decades, Kazakhstan’s livestock breeding industry has significant export potential," Tokseitova insisted.

The country has natural competitive advantages, such as its proximity to markets, suitable climate and large pastures, she said.

Kazakhstan has about 182.2m ha of natural pastures, of which only 42-43% is in use today.

Another factor in Kazakhstan’s favour is the Kazakh people’s ancient experience in animal husbandry and nomadic living, Tokseitova said.

"The vast pasturelands that allow us to minimise production costs and the neighbouring markets of China and Russia will help us greatly increase our exports of animal products,” Solyulev explained. “We must use these natural advantages wisely.”

Increasing the number of cattle, improving the gene pool

The project’s goal is to increase exports of meat, develop the commercial herd, improve its genetic potential and productive qualities, and create a modern industrial infrastructure.

The first phase aims to increase the size of high-yield beef cattle herds. It’s a difficult task because of Kazakhstan’s small number of beef cattle.

"The country has nearly lost its gene pool of pedigree livestock, and it cannot be restored quickly," said Kanat Tireuov, first vice-rector of Kazakh National Agrarian University.

Kazakhstan can improve its livestock only by crossing its cattle with bulls representing high-beef-yield strains. The country will import 72,000 head of the world’s best beef cattle for this purpose, according to KazAgro.

A number of problems have accumulated in feed production too, Tireuov said. The Ministry of Agriculture has ordered the creation of a programme to develop feed production nationwide. It includes a number of measures for sowing forage crops while taking climatic zones into account and for creating a system for breeding forage-crop seeds.

Betting on farms

Aid to farms that used to play a very minor role in cattle breeding is also a key component of the project.

To support farmers, KazAgro has launched Sybaga, a system of favourable loans, to help them buy breeding cows and bulls.

"Getting a loan has always been a big problem for owners of small and medium-sized farms," explained Bolat Utepbayev, an independent director of the Foundation of Financial Support for Agriculture. "The reasons for this include the farmers’ lack of collateral and the reluctance of commercial banks to deal with difficult borrowers."

Sybaga enables farmers to obtain simplified loans at 6% annual interest, with the cattle serving as collateral.