Drought reduced Kazakhstan's wheat production to an estimated 9.95 million tonnes in 2004/05, down from 11.50 million tonnes in the previous year, the US Agriculture Department said on Wednesday. Kazakhstan's key wheat-growing region is subject to serious drought about two out of every five crop seasons, the USDA's Foreign Agricultural Service said in a special report. Between 1993 and 1999, total grain area in Kazakhstan contracted at the rate of nearly 2 million hectares per year, the USDA said.
Plantings of wheat began to rebound in 2000, and rose to11.8 million hectares in 2004/05, aided by government subsidies that have helped improve crop yields, it said. The government spent nearly $200 million on farm subsidies for seeds, fuel, herbicides, fertilisers and machinery in 2004 and will rise to about $230 million in the 2005 crop season, the USDA said.
Wheat prices have little impact on plantings because farmers in north-central Kazakhstan have few options other than to plant spring wheat, the USDA said. "With production costs of roughly $50 to $60 per ton and similar costs for certification and transportation, farmers are lucky to clear a slight profit with a wheat price of $120 to $130 per tons," the report said.
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