Wheat Production and Regional Food Security in CIS: the Case of Belarus, Turkmenistan, and Uzbekistan
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FAO Regional Office for Europe and Central Asia Policy Studies on Rural Transition No. 2016-1 Wheat production and regional food security in CIS: The case of Belarus, Turkmenistan, and Uzbekistan Zvi Lerman, David Sedik Yuliy Yusupov, Ivan Stanchin and Irina Kazakevich April 2016 The Regional Office for Europe and Central Asia of the Food and Agriculture Organization distributes this policy study to disseminate findings of work in progress and to encourage the exchange of ideas within FAO and all others interested in development issues. This paper carries the name of the authors and should be used and cited accordingly. The findings, interpretations and conclusions are the authors’ own and should not be attributed to the Food and Agriculture Organization of the UN, its management, or any member countries. Zvi Lerman is Sir Henry d’Avigdor Goldsmid Professor of Agricultural Economics, the Hebrew University of Jerusalem, Israel. David Sedik is the Senior Agricultural Policy Officer in the FAO Regional Office for Europe and Central Asia. Yulii Yusupov is the Director of the Center for Economic Development in Tashkent, Uzbekistan. Ivan Stanchin is Professor of Financial Economics and Accounting at the Voronezh Economic-Legal Institute in Voronezh, Russia. Irina Kazakevich is a Senior Economist at the Institute of System Research of the Agro- industrial Complex, National Academy of Science of Belarus, Minsk, Belarus. 2 Contents Figures ........................................................................................................................................ 5 Tables ......................................................................................................................................... 8 Boxes ........................................................................................................................................ 10 1. Introduction ...................................................................................................................... 11 2. Farming Structure for Wheat Production in Belarus, Turkmenistan and Uzbekistan ...... 15 Importance of the agricultural sector in Turkmenistan, Uzbekistan, and Belarus ............... 15 Legislative framework for agricultural reforms in Belarus, Turkmenistan, and Uzbekistan 18 Private landownership .......................................................................................................... 18 Individualization of farming structure .................................................................................. 19 Land and crops ..................................................................................................................... 25 Changes in land use .............................................................................................................. 25 Cropping structure ................................................................................................................ 29 Crop production and yields .................................................................................................. 36 Gross returns per ha in Belarus, Uzbekistan and Turkmenistan and crop areas .................. 44 Livestock production ............................................................................................................ 47 Changes in livestock inventories and ownership structure .................................................. 48 Milk production .................................................................................................................... 52 Milk yields ............................................................................................................................ 54 Outcomes of reform .............................................................................................................. 59 Changing shares of production in farms of different types .................................................. 61 Changes in productivity ........................................................................................................ 64 3. Wheat Utilization and Medium-Term Outlook for Demand ............................................ 68 Food wheat utilization and forecasts .................................................................................... 68 Feed wheat utilization and demand ...................................................................................... 71 Livestock production history and forecasts, 1992-2024 ...................................................... 72 Estimation of feed wheat demand from livestock product production ................................ 74 Wheat demand medium term outlook .................................................................................. 79 4. Wheat Supply Medium-Term Outlook: Policies .............................................................. 82 Food security policies ........................................................................................................... 85 Partial planning system for wheat and its implications for wheat markets .......................... 86 The state order system in Belarus, Uzbekistan and Turkmenistan ....................................... 92 Support and tax policies for wheat ....................................................................................... 93 Agricultural finance in Belarus, Uzbekistan and Turkmenistan .......................................... 93 3 State taxation and support for wheat production through the price system ......................... 95 The implications of this system for farm incentives and wheat yields .............................. 100 5. Wheat Supply Medium Term Outlook: Resource and Labor Constraints ..................... 104 Climate and climate change ............................................................................................... 104 Land issues ......................................................................................................................... 109 Water resources and irrigation ........................................................................................... 111 Soil damage from irrigation: salinization and waterlogging .............................................. 115 Rural population and agricultural employment .................................................................. 116 Assessment: Evaluation of natural resource constraints for wheat production .................. 119 Wheat yield, area and production forecasts for Belarus, Uzbekistan and Turkmenistan ... 120 6. Conclusions: Wheat Demand, Supply and Trade Forecasts to 2024 and Beyond ......... 124 Annex 1. Legislation on land reform and farm restructuring in Turkmenistan .................... 128 Annex 2. Legislation on land reform and farm restructuring in Uzbekistan .......................... 130 Annex 3. Legislation on land reform and farm restructuring in Belarus ............................... 132 References .............................................................................................................................. 134 4 Figures Figure 1.1. Net wheat exports from the NIS countries, average 2008-11 ................................ 11 Figure 1.2. Wheat import dependency ratios for Belarus, Uzbekistan and Turkmenistan, 1987- 2014 .......................................................................................................................................... 12 Figure 2.1. Evolution of agricultural land in the NIS 1980-2008 ............................................ 17 Figure 2.2. Development of peasant farms in Belarus 1990-2012 (number and average size in ha) ............................................................................................................................................. 21 Figure 2.3. Development of peasant farms in Uzbekistan 1991-2011 (number and average size in ha) ......................................................................................................................................... 23 Figure 2.4. Uzbekistan: use of arable land by farms of different organizational forms 1991- 2012 .......................................................................................................................................... 26 Figure 2.5. Uzbekistan: use of agricultural land by farms of different organizational forms 1991-2012 ................................................................................................................................. 26 Figure 2.6. Belarus: structure of agricultural land in the individual sector (household plots and peasant farms), in percent ......................................................................................................... 27 Figure 2.7. Turkmenistan: structure of cultivable land in the individual sector 1983-2013 (household plots and peasant farms), in percent ...................................................................... 28 Figure 2.8. Belarus: cropping pattern, averaged for 1980-1995 and 1996-2010 (in percent of total sown area; cereals excluding wheat) ................................................................................ 29 Figure 2.9. Belarus: share of sown area in wheat and barley, 1980-2013 (in percent) ............ 30 Figure 2.10. Uzbekistan: cropping pattern, percent of total sown area (averages for 1980-1995 and 1996-2012) ......................................................................................................................... 31 Figure 2.11. Uzbekistan: area in wheat and cotton, 1980-2012 (‘000