The USDA said the year-over-year decline in output reflects a reduction in both area planted and area harvested in Kazakhstan. Area harvested was forecast at 11.5 million hectares in 2017-18, down from 12.437 million hectares in 2016-17, the USDA said.
Area planted to wheat has been affected by government policies, and, according to the USDA, a key reason for the decline was the re-establishment of oilseeds subsidies, which the USDA indicated provided strong incentives for farmers to switch to oilseed production.
In its report the USDA noted that wheat quality in Kazakhstan varied.
“Some wheat is hollow and has a low gluten content; however the average gluten content is reported at 25% to 26%,” the USDA said in the report. “Experts note that gluten content this year is higher compared to the previous 4 to 5 years.”
Food, seed and industrial (FSI) consumption of wheat is expected to remain unchanged in 2017-18 at 4.8 million tonnes, the USDA said.
On the trade front, exports of wheat from Kazakhstan are forecast at 7.5 million tonnes in 2017-18, up from 6.8 million tonnes in 2016-17.
“A number of regional market developments affected exports at the end of the previous marketing year and continue into the current marketing year,” the USDA noted in the report. “Stable exports to China during the last four months could be an indication of further development of the Chinese market. Since December 2015, Kazakhstan and China reportedly established a preferential trade regime that allows Kazakh wheat to be supplied in bulk and in bags, which facilitates trade.”
The USDA also identified Vietnam as another potential market for Kazakh wheat. The agency said a wheat test shipment was delivered to Vietnam during the spring to explore the possibility of further trade. In addition to China and Vietnam, other countries that may be potential trade partners include Singapore and India, depending on the outcome of potential free-trade agreements, the USDA said.