Government to back farmers hit by drought in Kazakhstan

On July 26, 2023, Minister of Trade and Integration of Kazakhstan Serik Zhumangarin instructed the Agrarian Credit Corporation and Kazagrofinance to support farmers suffering from drought by restructuring their loans.

«Depending on what kind of consequences we’ll see after drought in some areas, farmers can apply for credit deferment. The National Managing Holding Baiterek, Agrarian Credit Corporation (ACC, controlled by Baiterek) and Kazagrofinance (a subsidiary of the ACC) should facilitate those farmers who have suffered from drought to obtain credit deferment,» Zhumangarin said.

According to the agency, 6.1% of fields with cereals, 8.7% of fields with oil-bearing crops and 15.6% of fields with vegetables have been hit by drought.

Even though the climate is unpredictable in most parts of Kazakhstan, local farmers are reluctant to use insurance instruments for the agricultural sector. For example, farmers have insured this year just 258,200 hectares of grain and oilseed crops out of 20 million hectares in total, although the government subsidizes 80% of all insurance payments, the ministry reported.

In the middle of July, some media outlets reported that farmers in the Pavlodar region were asking the local authorities to declare a state of emergency due to drought, citing Asain Baykhanov, the region’s governor. If the government declares a state of emergency, farmers will get some compensation from authorities.

In turn, Minister of Agriculture Yerbol Karashukeev claimed that there is no drought in the country.

«There is no drought. According to Kazhydromet and soil surveys, we have an average moisture rate. Therefore, the situation is quite standard and we are keeping it under control,» Karashukeev told reporters.

In 2022, Kazakhstani farmers harvested 16.4 million tons of wheat, although the Ministry of Agriculture expected just 13.4 million tons. This summer, the ministry is forecasting a wheat harvest of 16 million tons.