In a strategic move to enhance its wheat export competitiveness, Kazakhstan’s Ministry of Agriculture has announced the implementation of transportation subsidies effective from March 3, 2025. This initiative aims to alleviate transportation costs for exporters, thereby strengthening Kazakhstan’s position in global grain markets.
The government has earmarked 40 billion tenge (approximately $90 million) to subsidize the export of 2 million tons of wheat. The subsidy rates are set at 20,000 or 30,000 tenge per ton, depending on the export route . The specific allocations are as follows:
- 20,000 tenge per ton for exports:
- Transiting through Russia to the ports of the Azov, Black, and Baltic Seas.
- Transiting through Russia, Latvia, Lithuania, and Estonia to the Baltic Sea ports.
- Transiting through Russia destined for Latvia, Lithuania, and Estonia.
- Transiting through Turkmenistan to Afghanistan or Iran.
- Direct exports to Azerbaijan, Georgia, and Armenia.
- 30,000 tenge per ton for exports:
- Transiting through Russia, Latvia, Lithuania, and Estonia to the Baltic Sea ports.
- Transiting through Azerbaijan and Georgia to the Black Sea ports.
- Transiting through China to Southeast Asian countries.
Additionally, the state-owned Food Contract Corporation will receive subsidies of 20,000 tenge per ton for wheat exports to Tajikistan, Turkmenistan, Uzbekistan, and China .
These subsidies are introduced to prevent domestic market oversaturation and to free up storage capacities by facilitating the removal of surplus grain. This measure is particularly timely, considering Kazakhstan’s record grain harvest of 26.7 million tons in 2024, the highest in a decade .
By offsetting high transportation costs, these subsidies aim to make Kazakh wheat more price-competitive in international markets. This is expected to open new export avenues and strengthen Kazakhstan’s agricultural sector.
Kazakhstan’s introduction of transportation subsidies for wheat exports represents a proactive approach to bolster its agricultural exports. By alleviating logistical costs, the government aims to enhance the competitiveness of Kazakh wheat in global markets, prevent domestic oversupply, and support local farmers. This strategic move is anticipated to solidify Kazakhstan’s standing as a key player in the international grain trade.
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