Farmers of Kostanay region ask the Food Corporation to take into account the factors that influenced the increase in costs of grain production this year when setting forward purchase prices. If prices are lower than the cost price, this will lead to the bankruptcy of many farms, the Association of Agricultural Producers of Kostanay region stated.
Farmers proposed to set the following purchase prices for soft wheat of class 3 per ton:
- gluten 23-24% - 100 thousand tenge
- gluten 25-27% - 115 thousand tenge
- gluten 28% and above - 125 thousand tenge
The following purchase prices for agricultural crops are also proposed:
- soft wheat class 4-5 - 80-90 thousand tenge
- hard wheat class 3 - 160 thousand tenge
- barley class 2 - 70 thousand tenge
Farmers draw attention to the fact that due to rains during the harvest in 2023, a large volume of grain was of low quality, as a result, its selling price was lower than the cost of production. Also this year, farmers incurred high costs for fungicide treatment.
Existing debts on subsidies and the cancellation of their payment for 2022 affected the financial stability of farms. Also, a high burden on business is the payment of loans with a full interest rate of 22%.
The high cost of grain production is affected by the old fleet of equipment with low efficiency, while the industry is catastrophically short of personnel.
This year, difficult weather conditions again do not allow for active harvesting of crops. Farmers will also face an increase in costs for drying grain.
"Representatives of the Association understand that the proposed prices are higher than those that have developed on the market today at the beginning of the harvest. But if a lower price is set, farmers will not be able to pay off existing debts and stay afloat, which will lead to an increase in accounts payable and, as a result, the onset of bankruptcies of farms. At the same time, when selling grain, the Food Corporation can petition KTZ for preferences in the transportation of grain. And also about benefits with other institutions and organizations, since it is easier to provide them only to the Food Corporation than to a large number of agricultural producers,” the Association noted.