The lack of systemic approach to problem solving in cattle industry and meat production does not allow the country to take its niche in the global export of meat.
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Meat industry in Kyrgyzstan as in many Central Asian states is a priority industry. Livestock farming in the republic is the main part of the source of income and food of the rural people, and its share in GDP of the country’s agriculture is 45.6 per cent. However, there are 26 companies and over 287 self-employed entrepreneurs that make meat products in the country. Meat factories produce a selection of meat products: fresh, cooled, frozen, dried, smoked, tinned meat and edible by-products of all kinds, meat delicacies, sausage products. The country seems to have a potential for meat
exports. However, if we look at it from today’s point of view, we can arrive at deplorable conclusions about the meat industry of the country. The following factors have contributed to such conclusions:– Kyrgyzstan does not provide itself with meat;
– The country imports 3 times more meat than it exports;
– Kyrgyzstan does not have a developed meat processing industry.
In this article, we’ll try to answer all these questions, including questions about meat price rise, the culture of meat consumption by the Kyrgyzstanis, and also to discuss the possibility of national meat branding, its export opportunities, as well as offered measures to develop the industry.
Situation in the meat market of Kyrgyzstan
The year of 2020 was marked not only by the outbreak of the pandemic, political coup, cancellation of parliamentary election results, but also by socially significant problems. Thus, one of the most popular issues was meat production, including meat prices. This product is on the list of socially significant foodstuff, yet the meat price since the
beginning of the year increased by more than 20 per cent.If the sheep meat price in January was 305.9 som per 1 kilogramme (about 3.5 dollars) on average in the country, last month (October) it was 380.6 som (almost 4.5 dollars), and in November it was 390.6 som (increase per month was 2.6%, since the beginning of the year 27.7%).
If the beef price in January was 326.3 som per 1 kilogramme (about 3.84 dollars) on average in the country, last month (October) it was 384.4 som (almost 4.53 dollars), and in November it was 403,8 som (4.75 dollars) – the increase per month was 4.9%, since the beginning of the year 23.8%.
According to the State Agency of Antimonopoly Regulation of the Kyrgyz Republic, the rise in meat prices in Kyrgyzstan was due to restrictive protective measures applied by Kazakhstan to export of meat in live weight.
In the neighbouring republic, the ban on livestock exports was related to the fact that much cattle was exported beyond the country. In 2019, about 150 thousand head of cattle was exported, including 121.6 thousand head exported to Uzbekistan. In 2019, 264 thousand head of sheep was exported, including 200 thousand head to Uzbekistan. 50-60 thousand head of cattle was exported to Kazakhstan.In other words, the main reason for the moratorium was the explosive growth of bovine cattle supplies to Uzbekistan, which increased four times last year – from 39 thousand head in 2018 to 156 thousand head in 2019. By the way, it was one of the factors contributing to the significant rise in meat prices in Kazakhstan.
Uzbekistan, in turn, has adopted the programme of livestock farming revival. The programme grants cheap loans to farmers for livestock purchase, which allows them to purchase livestock from Kazakhstan for 800 to 950 tenge per 1 kilogramme (1.90-2.25 dollars) of live weight depending on the level of fattening. Kazakhstan meat packing plants purchase cattle 100 tenge (0.24 dollars) cheaper.
Second, Kazakhstan introduced the ban to export processed products, not raw materials. The ban is valid until November 2020. Kazakhstan has a problem of meat processing, so it wants its farmers to sell feeder steers.
Because of the ban introduced by Kazakhstan, Uzbekistan and Tajikistan started purchasing the cattle in greater quantities in Kyrgyzstan.
However, according to the National Statistical Committee, the share of expenses on meat and meat products in the last 5 years increased from 23.9 per cent in 2015 to 29.1 per cent in 2019 in total expenses on food products.
What statistics reveal
Livestock production prevails among other sources of subsistence of rural people because of the abundance of pasture resources in Kyrgyzstan and makes 48.1 per cent of gross agricultural output in the country. Out of 55.2 per cent of agricultural lands, pastures make 43 per cent, including almost one half of summer pastures, 30 per cent of
spring and autumn pastures, and 25 per cent of winter pastures. Livestock farming is concentrated in mountainous areas of Naryn, Issyk Kul and Osh regions and is used to produce mainly meat and milk.Ten districts, such as Zhaiyl, Moskovsky, Sokuluk and Issyk Ata districts of Chui region, Naryn district of Naryn region, Suzak district of Zhalal-Abad region, Karasuu, Nookat and Uzgen districts of Osh region and Kadamzhai district of Batken region have the highest figures of meat production – over 11 thousand tonnes of meat per year, or 61 per cent of total meat produced in the country. The majority of districts produce more meat than is needed for own use.
In terms of specific numbers, in 9 months of 2020 Kyrgyzstan exported meat products in the amount of 224.6 tonnes for 496.7 thousand dollars to 10 countries of the world. Today, the fans of meat from Kyrgyzstan are the United Arab Emirates. This country imports sheep and goat meat for 264.4 thousand dollars. So far, this is the highest number ever. This kind of meat is also exported to Iran, Kuwait and Uzbekistan.
Frozen beef is also in heavy demand among other kinds of meat – India imports 84 tonnes for 168 thousand dollars.
In general, according to statistical data, we can see that in the last 2 years exports of meat products have decreased a little, but their price has increased. In 2018, the country exported 1 thousand 559.4 tonnes of meat for 3.9 million dollars, in 2019 the amount dropped down to 1 thousand 341.2 tonnes for 4 million 524.2 thousand dollars.As for the imports of meat products, the recent data show that in January to September 2020 Kyrgyzstan imported 1 thousand 778.7 tonnes of products for 1.6 million dollars. This is much more than it exported. However, it turned out that the country imported a lot of pork meat – 547.2 tonnes for 1 million dollars – from Russia and Kazakhstan.
Another but not less popular meat product was fresh or cooled beef meat – 181.1 tonnes for 512.4 thousand dollars. Belarus was the main importing country.
In general, Kyrgyzstan has decreased the import of meat products in the last 2 years. Thus, in 2018, the amount was 1 thousand 140.8 tonnes for 3.7 million dollars, but in 2019 the amount fell down to 606.5 tonnes for 1.8 million dollars.
Big potential, few opportunities
Kyrgyzstan has a very big potential in the export of meat products. This is the opinion of the head of the collective farm Spartak, Bakyt Mamytkanov, who shared it with CABAR.asia.
“For example, Ireland has 7.5 million head of cattle, but the area of their pastures is 2.5 million hectares. We have 9.5 million ha of pastures and only 1.8 million head of cattle. In other words, we have 4.5 times more opportunities, and the quantity of our cattle may be increased up to 10 times,” he said.
According to him, every year the country produces nearly 400 thousand tonnes of meat in live weight and can increase the share of agriculture in the GDP composition only by meat products.
“In 2012, representatives of Qatar came to us and offered to buy our meat. If we make only one supply, they will be buying our products for 1 million dollars a year. For comparison, agriculture in the GDP composition amounts to 900 million dollars. These figures speak for themselves. Only one country buying meat from Kyrgyzstan can increase the GDP of our country. In addition to Qatar, our meat products are exported to 18 countries worldwide, yet in small amounts. Our meat is in demand, but we have to work it out,” Mamytkanov said.
The head of the competitive agribusiness centre, Almaz Dooronbaev, emphasises two ways of development: intensive and extensive.
“We are still going the path of extensive development. So far, our livestock number is growing. When you slaughter a calf, it will give you nearly 200-250 kilogrammes of meat; when you slaughter a calf abroad, it will give you 400-500 kilogrammes of meat. However, the costs will be equal. For example, if our calf is given one fodder unit of
barley, it will give 100 grams of meat; but if you give kilogrammes to a purebred calf, it will give more meat. There’s only one solution – we should develop our livestock breeding operation. Given equal costs, we’ll get twice as much meat if the calf is purebred. So far, we have developed only due to the livestock number,” the expert said.Moreover, the environmental situation contributes to the reduction of the livestock number and increase in its performance. Thus, according to Dooronbaev, cows are one of producers of methane and carbon dioxide.
“The cattle contributes about 8 per cent to climate change, namely to its warming. Every cattle produces about 5 to 15 kilogrammes of dung, which releases methane. In other words, the task is very controversial. Therefore, we need to increase production and reduce the quantity of livestock,” he said.
Kyrgyz meat brand and its promotion to foreign markets
Option 1, national delicacies. Currently, Kyrgyz national delicacies are not in demand in foreign countries. This is the opinion of the ministry of agriculture, food industry and land reclamation. However, the expert in meat industry Mamytkanov does not agree with this opinion.
“Our delicacies have been in demand only in neighbouring Uzbekistan before and during the pandemic. They eat much horsemeat as this kind of meat contains many vitamins. If a horse eats 300 grass species, a cow eats only 60. Therefore, their meat is full of various vitamins. We’ve known about this from the earliest times. This is why Uzbekistan started to use kazy-karta, chuchuk, horsemeat. So, we can say that national delicacies have a great potential,” he said.
Statistical data prove the farmer’s words about Kyrgyzstanis eating more horsemeat now. Thus, according to the dynamics of the last 10 years, the number of bovine cattle has been increasing slowly but steadily from 1.2 million to 1.6 million head. This contributes to the enhancement of the meat products export.
In the meantime, there is a change of culture of meat consumption.
Since 2008, the Kyrgyzstanis started to raise more horses – nearly 1.5 times more – from 362.4 thousand head to 522.6 thousand head and poultry – from 4.3 million to 6.2 million. But the pig stock has reduced significantly – from 63.3 thousand to 34.7 thousand in 2019.
According to the latest data of the National Statistical Committee, bovine cattle (cows), sheep and goats, poultry are top priority of livestock farming. Pigs are in least demand because of the national identity and a switch to halal food.
Option 2. Jerked meat. Some farmers suggested promoting smoked or jerked meat. A representative of the Kyrgyz Meat company [the company produces and sells smoked meat], Ulukbek Ilsheev, said this kind of meat is in demand both in the domestic market and among foreigners.
“90 per cent of our customers are foreigners. There will be no difficulties with its export as foreigners know it and rate it highly. All we need is to create appropriate conditions. These issues must be solved at the governmental level as the export procedure is very expensive. It costs a lot to revise the plant in compliance with all requirements. The area
of the plant and equipment must comply with requirements. Foreigners rate highly beef, sheep meat for its high quality. The government must be concerned with this issue, it’s not just a matter of export,” he said.As Karybek Asanov, independent expert of the ministry of agriculture, said, jerked meat can be promoted abroad, but it will be a very expensive delicacy.
“We can try to export it, but we don’t have sufficient domestic resources,” he said.
Option 3. Yak meat. Another option for meat export is the yak meat, which becomes more popular among the Kyrgyzstanis. The demand for this kind of meat can be explained by cheaper price and eco-friendliness.
Thus, according to the head of the competitive agribusiness centre, Almaz Dooronbaev, yak meat is available on the market at 360-370 som (4.26-4.36 dollars) at wholesale, while beef meat costs 390 som (4.60 dollars) per 1 kilogramme.
“Yak meat looks like beef, but it’s dark red compared to beef. Yak meat is considered more organic and pure and higher in calories. It is sold in the markets of Kazakhstan, but we have no information about its official export,” the expert said.
The Association of Yak Farmers raised the initiative of yak meat export last year.
The head of the Association, Kubanychbek Sheyitov, said that raw meat may not be exported to neighbouring countries as it spoils quickly.
“It’s reasonable to produce delicacies, for example, uncooked smoked sausages or jerked meat. These kinds of meat products are suitable for yak meat at we don’t have much of it,” he said.
“In Kyrgyzstan, there are 30-40 thousand head of yaks. To shape the market, we need to increase this figure by ten,” the expert said.
Option 4. Kyrgyz meat as organic product. In general, the number of bovine cattle is growing in Kyrgyzstan: 1.6 million head of bovine cattle, including 800 thousand cows and 6 million sheep and goats.
“I think it’s reasonable to promote raw meat at the first stage. Processed meat, including delicacies, will hardly be accepted by anyone but our Kazakh neighbours. Currently, our meat is exported mainly to the Arab countries, Tajikistan, Kazakhstan, and foreigners say it is very delicious,” Almaz Dooronbaev said.
Independent expert Karybek Asanov supports the idea of promotion of the Kyrgyz meat per se to other countries as there is no opportunity for processed meat export.
“We live in an environmentally friendly area, and our cattle feeds on pastures for six months with clean air and no chemicals around. The idea is great, but meat processing industry is not well developed here. We have only primary meat processing. To promote the meat of Kyrgyzstan as our national brand, we need some help. We have very few
resources. Despite the fact that our meat is very delicious, it is not enough to export it in large quantities,” he said.Food security: Kyrgyzstan is not self-sufficient in meat
According to the governmental decree, the main staple items include bread and cereal products, potato, fruits and berries, vegetables and gourds, sugar, vegetable oil, milk and dairy products, meat and meat products, eggs.
By results of 2019, the demand for meat among the population, according to the average physiological norm, was 399.2 thousand tonnes, and the self-sufficiency rate including meat balance and imports was 69.9 per cent. In other words, the country is self- sufficient in meat.
The monthly demand of the population for meat is 33.3 thousand tonnes. A Kyrgyzstani must eat about 1.9 kilogrammes of meat for 1 month. This norm is valid in the last 3 years and it increased from 1.7 kilogrammes in 2017.
According to experts, self-sufficiency in meat remains a controversial issue as all calculations are based on official data, but there are facts of domestic slaughter.
Recent governmental ban on livestock export
The government of Kyrgyzstan made a decision on November 20 banning the export of some agricultural goods, as well as bovine cattle, horses, sheep and goats, chicken and ducks. The ban will be valid for six months.
The ministry of agriculture related this initiative to ensuring food security in the country.
“It’s important to ensure food security in today’s hard times. We need to make quick decisions because of the rise in vital goods prices. There’s a risk of insufficient livestock numbers in the domestic market,” according to the message of the agency.
Another reason for the ban was the drastic reduction of the breeding stock. The ministry is planning to increase meat and milk production by means of artificial insemination of cattle.
According to the head of the Kyrgyz Sut Association, Bakyt Turdubaev, export always encourages local production and this governmental decision is wrong.
“We could continue exporting without fear of reduction of the breeding stock. We have been looking for livestock and meat supply chains abroad for the last 3 years. Last year we were in Qatar. We held negotiations there and took part in the sheep meat exports tender. According to the requirements, we had to supply 40 thousand head every month. We could have done it, but they specified that all sheep must be of equal height and breed – merino. We have 7 million sheep, but we cannot gather equal sheep within a month as we have only 35 thousand merino sheep farms. The lack of coordination plus small commodity production have hindered us. We made a blunder. As we are not motivated, our domestic market does not have such standards,” Bakyt Turdubaev said.
5 steps to develop meat industry
In summary, we can outline the following steps to develop meat industry in Kyrgyzstan, according to experts.
Step 1. Cancel import VAT on bovine cattle and sheep and goat, which is 12 per cent.
Step 2 .Develop the culture of feeding of bovine cattle and sheep and goat.
Step 3. Bind banks to make amendments to the loan portfolio in order to lower interest rates for cattle feeding. Thus, according to B. Mamytkanov, today banks grant loans for cattle feeding at the rate of 18-24 per cent per annum, which is inappropriate for farmers.
Step 4. Export more secondary processed meat, not primary processed one.
Step 5. Develop livestock breeding operation.
This article was prepared as part of the Giving Voice, Driving Change – from the Borderland to the Steppes Project.