In mid-September, the capital of Uzbekistan hospitably welcomed the participants of the third international conference «Asia Grains & Oils Conference in Tashkent 2023». The conference was organized by APK-Inform Asia (Kazakhstan) in partnership with Inter Standart Consult (Uzbekistan) and Expo Time (Kazakhstan), co-organized by Event Group (Kazakhstan).
Asia Grains&Oils Conference in Tashkent-2023 became a truly large-scale event and brought together delegates from 20 countries — representatives of companies exporting and importing agricultural products, processors, agricultural holdings, industry associations, logistics companies and financial institutions, and government bodies. Thus, about 60 companies from Uzbekistan — representatives of the grain and oilseeds market — took part in the event.
The atmosphere at the event matched the weather — comfortable and warm.
This time, the organizers offered a new format for the conference — the first day was held traditionally, in the session hall, and the second — at the Amirsoy Mountain Resort, and was completely devoted to negotiations in the B2B format.
The session covered the global trends in the economy and foreign trade of Central Asia, grain and flour markets, and the fat and oil industry.
As our regular speaker, EBRD Leading Regional Economist Eric Livni, noted, in 2022, the economies of the Central Asian countries demonstrated their resilience in an unstable geopolitical situation, and in 2023, active growth continued.
Among the positive factors for the economies of Central Asian countries, E. Livni noted the following: the migration of companies and people to Central Asia (mainly to Kazakhstan) from the Russian Federation, and the opening of China after the pandemic. And among the negative ones: sanctions, interruption of transit flows due to the escalation of the war in Ukraine, as well as the “fragile” political situation in the Central Asian countries.
Alexander Karavaitsev, senior economist at the International Grains Council, said that in the new season the global market expects a rollback in wheat production due to a reduction in yields in key exporting countries. In his opinion, record carryover stocks of wheat will somewhat compensate for the reduced grain production in 2023/24 MY, but nevertheless, the total volume of supply will be limited.
The discussion of global trends were followed by regional ones.
Daulet Uvashev, director of Harvest Kazakhstan LLP, during his speech at an international conference, announced an updated forecast for the harvest and export of wheat in Kazakhstan. According to his estimates, despite the increase in planting areas to the maximum level in the last 10 years — up to 13.72 mln ha — this year the wheat harvest in the Republic of Kazakhstan will not exceed 12.5 mln tonnes (against a record 16 mln tonnes last year). He clarified that the decrease in the total harvest forecast was due to unfavorable weather conditions during the growing season (drought) and harvesting (heavy rains).
The expert expects that the export potential of wheat from Kazakhstan in the current season will be about 9.5 mln tonnes (grain + flour in grain equivalent). In the recently finished 2022/23 MY, grain deliveries to foreign markets were 1 mln tonnes higher (10.5 mln tonnes), which was the highest figure since 2011, according to «Harvest Kazakhstan» estimates.
The main sales markets will remain the countries of Central Asia — they account for about 69% of all shipment of Kazakh wheat. In 2022/23 MY, non-CIS countries accounted for 27% of Kazakh wheat exports — this is slightly higher than the average for the last 5 years. This season, grain deliveries to China and Afghanistan are expected to grow, which could increase the share of exports to non-CIS countries to 30-35%.
But the production is one thing, and quality is quite another. This season, in Kazakhstan, there is an ambiguous situation with the quality of new crop grain — due to difficult weather conditions, experts expect a large share of sprouted wheat, some of which will not even be able to be used for feed. On the other hand, in this situation those agricultural producers who have large stocks of high-quality wheat of the 2022-harvest can win — prices for this grain can soar much higher than the current ones.
Saltanat Orazova, Head of Laboratory of the Department of «Agro-Industrial Complex» of “SGS Kazakhstan Ltd” LLP, said that Kazakhstan’s wheat of the 2023-harvest, collected before the rainy season, has a higher protein content (>14.5%) and gluten (>32.2%), but due to drought during the growing season, the natural weight is quite low (the grain is “slim”) and averages ~77.1 kg/hl. According to SGS Kazakhstan estimates, the share of sprouted grain in the total wheat crop in Kazakhstan will be from 5 to 15%, but there are areas where this figure reaches 50-60%. There were no such figures even in 2019, when there were similar weather conditions, the expert noted.
At the conference, there was an information that many Kazakh farmers take their grain (collected before the rains) from the elevators in order to prevent mixing with wet wheat and preserve high-quality dry wheat for further sale and planting next year.
According to Daulet Uvashev, this situation plays into the hands of farmers and traders who have large stocks of high-pro wheat of the 2022-harvest — with a high protein content and good natural weight. Prices for wheat of this quality in Kazakhstan can rise to 150`000 tenge, believes D. Uvashev.
“I would like to draw your attention to the fact that now not a single farmer is ready to sell what has already been threshed, due to the unclear situation of what will happen next. There will be a time lag when there seems to be some harvesting, but there will be no real offers until the producer understands the quantity and quality of the harvested grain before and after the rains,” said Sergey Domaev, director of the B-Agro Sever LLP company, which deals with both crop production and trading.
An interesting point — many speakers in their speeches emphasized that in order to survive and develop, companies need to increase efficiency and pay attention to diversification. This applies to both agricultural producers, processors, and traders.
Thus, according to the forecasts of Oybek Zufarov, Chairman of the Board of the Association of Oil and Fat Enterprises "Uzyogmoysanoat", in the next 5 years in Uzbekistan the number of enterprises processing oilseeds will decrease by about 10 times — to 30. This will happen due to the consolidation of competitive enterprises and the exit of inefficient processors from the market.
According to him, today there are 300 oil production enterprises in the country, the total processing capacity is 4.3 mln tonnes of oilseeds per year. At the same time, capacity utilization reaches only 62%. As a result of the closure of inefficient enterprises, this figure could increase to 80%, the speaker noted, while the total processing capacity will remain at the same level.
“The production volumes of vegetable oils by the remaining enterprises will be enough to saturate the domestic market and for export,” believes O. Zufarov.
Another speaker, FAO national project coordinator Aziz Nurbekov, emphasized that agricultural producers in Central Asia need to diversify crops, actively use new varieties, introduce proper crop rotation and switch to resource-saving technologies. Thanks to this approach, Uzbekistan was able to achieve a significant increase in wheat yield — according to FAO estimates, this figure has increased more than 8 times over the past 30 years.
Another successful example of diversification that producers and traders of crop products should strive for is pulses. Co-founder of the Global Export company Sardor Abaskhanov emphasized that in the future the role and importance of legumes in the countries of Central Asia will grow — this is a global trend. Particularly, in terms of mung bean exports, Uzbekistan is already among the TOP 10 global suppliers. At the same time, there is a decline in production and exports of beans and chickpeas in the country.
Incredible, but true: Kazakh traders told their Uzbek colleagues at the Asia Grains&Oils Conference that they supply chickpeas to Turkey. At the same time, Uzbekistan imports chickpeas from Turkey, although it could do it directly from Kazakhstan! Thus, the conference once again confirmed its enormous practical value.
“I am sure that if we establish cooperation with our Kazakh colleagues, we will be able to be more competitive in the market,” says S. Abaskhanov.
During the oilseed session, participants discussed the trends in the palm oil market, its consumption in the world and prospects in Uzbekistan.
One of the speakers was Fadhil Hassan, Head of Foreign Division of the Indonesian Palm Oil Association (GAPKI), which was a Gold Sponsor of our conference.
According to F. Hassan, Uzbekistan is a promising market for the sale of Indonesian palm oil. Over the past 5 years, the volume of palm oil shipments to the countries of Central Asia has been quite low, but the largest volumes have been supplied to Kazakhstan and Uzbekistan.
As the speaker noted, vegetable oil consumption has a strong correlation with economic growth. It is forecasted that economic growth of Uzbekistan in the future will be quite high and will be around 5% in 2023-2024. Therefore, experts expect that the consumption of vegetable oil (including palm oil) will also grow.
The conference also touched upon the development of the Kazakh fat and oil industry, since the Republic of Kazakhstan is the closest neighbor and the main supplier of both oilseeds and processed products to Uzbekistan. Commercial Director of Qazaq Astyq Group LLP Alexander Buzhenitsa, in particular, spoke about the positive impact of the duty on the export of sunflower seeds introduced by Kazakhstan in February 2023.
“There are a large number of factories in the country that were underloaded with seeds. And only with the introduction of the duty it became possible to increase the production capacity of sunflower oil and increase the export potential,” the speaker noted.
According to A. Buzhenitsa, the strategic and consistent policy of the government should be to develop the production and export of processed products, not raw materials.
As part of the third international conference «Asia Grains&Oils Conference in Tashkent 2023», a special Technological session was also held. At this session, world market leaders — manufacturers of equipment for the fat and oil industry — spoke about modern technical and technological solutions for the industry.
Nastya Jiang, R egional sales manager of Myande Group Co. LTD, the General Sponsor of the conference, spoke about the Myande profile and optimal edible oil project execution practice.
The representative of the Gold Sponsor — Kemiline Agro — technical support specialist Maxim Kirin presented optimal solutions for oil refining.
Representative of the Buhler company (Exclusive Sponsor of the conference), regional sales manager of Buhler Service LLC Renat Butasov spoke about the advanced technologies that the world-famous brand offers for processing oilseeds.
The session included a presentation by another sponsor, You-Trade Global. The director of the company, Yer Muhanbetkaliev, presented an online trading platform for traders, agricultural producers, transport companies, suppliers of equipment, storage and packaging services.
After a busy information day, participants were able to get a boost of energy and positive emotions at what had already become a traditional bowling tournament. This time they played not only for “interest”, but also for prizes from the sponsor of the cultural program — the AgroProTrade company.
The second day of the conference — B2B negotiations — was held at a picturesque resort and brought a lot of communication, new acquaintances, experience, partnership agreements and contracts.
APK-Inform sincerely thanks the partners and sponsors who helped organize another unforgettable conference in Tashkent!
The event was held with the support of industry associations of Uzbekistan — the Association of Oil and Fat Enterprises of the Republic of Uzbekistan "Uzyogmoisanoat", the Assembly of Economy of Uzbekistan, JSC "Uzdonmakhsulot" and the Association of Exporters of Uzbekistan.
The sponsors were: Myande (General Sponsor), Kemiline Agro (Gold Sponsor), Indonesian Palm Oil Association GAPKI (Gold Sponsor), B-Agro Sever (Exclusive Sponsor), Buhler (Innovation Sponsor), LATFLEX, You-Trade and AgroProTrade (Sponsor of the cultural program).
Thank you to all participants for finding the opportunity to come in such difficult times, for communication, exchange of experiences and positive emotions! We don’t say goodbye, but say “See you!”. Follow the announcements of the time and location of new events in the APK-Inform feed.
