September 28, 2010

Kazakhstan revises down 2010 domestic grain purchase

Kazakhstan will buy 1.1 million tonnes of grain from local farmers this year, down from the earlier planned two million tonnes, a government official said Monday (Sep 27), adding that this amount would be enough to keep grain prices stable.

"Having analysed the balance of the stocks and incoming grain of the Food Contract Corporation, as well as a hike in prices for bread-making wheat, we propose to revise the planned two-million-tonne purchases down to 1.1 million tonnes," said Yevgeny Aman, executive secretary of the Agriculture Ministry.

Aman added that the purchasing price would stay unchanged from the earlier planned KZT26,500 (US$180) per tonne, which would allow to keep prices stable for bread-making flour and grain.

Kazakh officials said last month that the Central Asian nation's state-owned Food Contract Corporation planned to buy between 2.0 million and 2.5 million tonnes of grain from the 2010 crop to guard against inflation after a spike in world prices following Russia's worst heatwave on record.

"It is expected that the gross grain harvest will total 13.5 million tonnes," said Agriculture Minister Akylbek Kurishbayev, confirming earlier official production forecasts.

Kazakhstan, the world's seventh-largest wheat exporter, produces far more wheat than it consumes. Annual consumption is steady at around 2.6 million tonnes.

Even despite this year's crop being one third smaller than last year's record harvest of 20.8 million tonnes, the nation of 16 million will still have large stocks of exportable grain.

Kurishbayev confirmed earlier official grain export estimates of up to eight million tonnes. This is slightly below the 8.3 million tonnes sold in the last marketing year.