Kazakhstan's grain market is in a state of stagnation: deals are rarely concluded, and industry participants are cautiously assessing new price benchmarks. The situation has been impacted by changes in tax legislation related to the refund of value added tax (VAT), as well as external factors, including military events in Iran, which have effectively halted barley trade.
TAX CHANGES REDUCE DEAL ACTIVITY
According to Inbusiness.kz, an expert from the Grain Union of Kazakhstan (GUK), head of the analytics committee Yevgeny Karabanov, reported that sales activity in the agricultural crop market remained low over the past week.
In his words, the market is trying to recover from a prolonged stagnation caused by the new requirements of the Tax Code of the Republic of Kazakhstan concerning the refund of VAT.
“The market is now trying to recover after a prolonged stagnation caused by the new requirements of the Tax Code regarding VAT refunds. Buyers are testing the domestic market with offers, but the number of deals is small. For their part, the majority of agricultural producers are not ready to lower prices for grain crops, and exporters do not want to work at a loss or break even,” stated Yevgeny Karabanov.
According to GUK, there were no significant price changes on the domestic market over the past week.
HOW GRAIN PRICES HAVE CHANGED
Only class 4 wheat showed a slight increase — its price rose by 1,000 tenge to 88,000–92,000 tenge per tonne. Experts attribute this to activity from processors and exporters.
Prices for other crops remained unchanged:
- class 3 wheat with gluten content 23–24% — 90,000–94,000 tenge per tonne;
- class 3 wheat with gluten content 30+ — 123,000–127,000 tenge per tonne;
- class 5 wheat at elevators — 85,000–89,000 tenge per tonne;
- feed barley — 87,000–91,000 tenge per tonne.
According to the expert, market participants continue to adapt to the new conditions and are looking for benchmarks for further pricing.
MILITARY FACTOR IN IRAN HALTS BARLEY TRADE
The situation is further complicated by external circumstances. According to Yevgeny Karabanov, military actions in Iran have effectively halted barley trade.
The expert noted that the resumption of trade will depend on the duration of the military actions and internal political stability in that country.
GRAIN EXPORT REMAINS WEAK
The pace of grain shipments for export also remains low. The expert cited offers from exporters at new, higher prices as one of the reasons.
Importers, for their part, are trying to assess further market prospects and are in no hurry to conclude contracts.
According to GUK, export prices for a number of wheat positions have decreased:
- class 3 wheat with gluten content 23–24%, 27%, 28–29% and 30+ fell by $5 per tonne — to $260–315 per tonne depending on quality;
- class 4 wheat fell to $250–255;
- class 3 wheat with gluten content 25–26% decreased by $3 — to $265–270.
Also, export offer prices for barley on a DAP Saryagash basis decreased by $5 — to $250–255 per tonne.
At the same time, on FOB Aktau port terms, prices remain nominal at the level recorded before the start of the military actions. The materials note that deals are effectively not being concluded.
According to the expert's assessment, a market revival is possible only with the stabilisation of external factors.