Exports - The Times Of Central Asia

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New Border Warehouse to Boost Kyrgyz Agricultural Exports to China

Kyrgyzstan and China have inaugurated a major new warehouse in the city of Ulugqat, located in China’s northwestern Xinjiang Uyghur Autonomous Region (XUAR), near the Kyrgyz border. The facility is designed to facilitate the export of Kyrgyz agricultural products to China, serving as a key logistics hub for cargo passing through the nearby Torugart and Irkeshtam border checkpoints. At the opening ceremony on March 18, Bakyt Torobayev, Deputy Chairman of Kyrgyzstan’s Cabinet of Ministers and Minister of Water Resources, Agriculture, and Processing Industry, stated that the warehouse will improve logistics and ensure a reliable and uninterrupted supply of agricultural goods. In its initial phase, it will focus on the smooth transit of grain and legumes. According to the Kyrgyz government’s press service, the warehouse is divided into four zones: vegetable storage, frozen storage, laboratory facilities, and general cargo. It has an annual processing capacity of more than 1 million tons. Future expansion plans aim to accommodate a broader range of agricultural products beyond grains and legumes. During the ceremony, a deputy chairman of XUAR’s People's Government emphasized China’s commitment to increasing imports of high-quality Kyrgyz agricultural products, in line with President Xi Jinping’s directives. Official statistics show that in 2024, Kyrgyzstan’s agricultural exports to China reached $124 million. Of this, 8.6% consisted of livestock products, 19.4% crop products, and 72% processed food and agricultural goods. Plans for a New Logistics Park During his visit to Xinjiang, Torobayev also met with major Chinese companies in the province's capital Urumqi to discuss a project for an international customs and logistics park, Golden Road Asia-Europe, in Kyrgyzstan’s Chui region. Torobayev announced that Kyrgyzstan will allocate a land plot for the facility, which is expected to equally serve the export-import interests of both countries. The total investment in the project is estimated at $30 million. Chinese Agricultural Equipment for Kyrgyzstan Torobayev also held talks with a Chinese company specializing in agricultural drones and artificial precipitation technologies. As a result, the company agreed to provide Kyrgyzstan with agricultural equipment for artificial rain and pest control, valued at more than $1.1 million, on a grant basis.

China to Build Wheat Processing Plant in Kazakhstan’s Akmola Region

China’s Dalian Hesheng Holdings Group Co., Ltd. plans to establish a vertically integrated industrial park for the deep processing of wheat in Kazakhstan’s Akmola region. The project was discussed on December 18 during a meeting between Kazakhstan’s Prime Minister Olzhas Bektenov and a delegation from the Chinese company. Investments in the project will total $500-$800 million for the initial phase, with an additional $1 billion planned for the second and third phases. The plant will process 1 million tons of wheat annually during the first phase, with capacity increasing to 3 million tons per year in subsequent phases. The initiative is expected to create approximately 2,000 jobs. Construction is set to begin in the second quarter of 2025. The project will also include the construction of a coal-fired thermal power plant and a coal chemical complex capable of producing 150,000–400,000 tons of liquid ammonia annually. Prime Minister Olzhas Bektenov underscored the importance of enhancing wheat processing and expanding the production of high-value-added products. He directed government agencies to expedite the signing of an investment agreement with Dalian Hesheng Holdings. Kazakhstan has significant potential in deep grain processing, harvesting 16-17 million tons of grain annually. More than 260 different high-value-added products, such as bioethanol, gluten, and animal feed, can be derived from processed grain. The Times of Central Asia previously reported that Chinese company Myande Group signed a memorandum of cooperation in July for the construction of a wheat processing plant in Kostanay. That facility will produce amino acids, bioethanol, gluten, animal feed, and wheat bran, further bolstering Kazakhstan’s grain processing sector.

Turkmenistan to Boost Gas Exports to Neighbor Uzbekistan

Uzbekistan has agreed to purchase more natural gas from Turkmenistan, though the amount of additional gas and the price remain unclear. Uzbek President Shavkat Mirziyoyev spoke by phone with the chairman of Turkmenistan’s Halk Maslahaty (People’s Council) and leader of the country Gurbanguly Berdimuhamedov on December 5 to discuss the deal. According to Turkmen state news, Berdimuhamedov “agreed to the increase” of Turkmen gas to Uzbekistan, and it would not be surprising if Berdimuhamedov was quietly dancing in celebration on the other end of the line. Anxious to Sell Turkmenistan has the fourth largest gas reserves in the world, some 17.5 trillion cubic meters, at least. To put that in perspective, the 27 countries of the European Union, combined, used 350 billion cubic meters of gas in 2022, meaning Turkmenistan has enough gas to meet all the EU’s gas needs, at current levels, for 50 years. Unfortunately, more than 33 years after becoming independent, Turkmenistan still does not have many customers for its gas. There is China, which buys the most Turkmen gas, some 35 billion cubic meters (bcm), Uzbekistan, which in recent years has been purchasing 1.5-2 bcm annually from Turkmenistan, and Azerbaijan, which gets 1-1.5 bcm of Turkmen gas via a swap arrangement involving Iran. Turkmenistan’s only successful recent export deal is with Iraq for 10 bcm, which involves a swap arrangement with Iran that will require maintenance work and repairs on Turkmenistan’s and Iran’s pipelines. Turkmenistan just lost Russia as a customer after the contract for Russia to purchase up to 5.5 bcm of Turkmen gas expired at the end of June 2024. The expiration of the agreement with Russia meant Turkmenistan lost its second biggest buyer, but that might now turn out to be good news for Uzbekistan. Anxious to Buy The jump in the number of people and accompanying expansion of service infrastructure have combined with Uzbekistan’s gross failure to increase domestic gas output to make Uzbekistan a net gas importer. In late January 2023, Uzbek media reported the country produced some 51.7 bcm of gas in 2022 and said plans called for increasing that to 56.3 bcm in 2023. Instead, gas production fell to 46.7 bcm in 2023, and it is set to decrease further in 2024. Uzbekistan signed its first contract for Turkmen gas in December 2022. That deal was for 1.5 bcm annually, but in August 2023, the two countries agreed to boost that to 2 bcm. However, that was not enough to fill Uzbekistan’s growing gas consumption needs. In June 2023, Uzbekistan signed a two-year agreement to import up to 2.8 bcm of gas from Russia, but by March 2024, reports showed Uzbekistan looking to increase Russian gas imports to 11 bcm starting in 2026. It looks like some of the 5.5 bcm Turkmenistan was until recently selling to Russia will instead be sent to Uzbekistan, so for Turkmenistan, the gas deal with Uzbekistan only recovers some of the revenue lost with the expiration of the contract with Russia....

Turkmenistan’s Unexplained Shortage of Gasoline

For months now, areas in eastern Turkmenistan have been facing a severe gasoline shortage. The lack of fuel at the pumps is having a knock-on effect that is raising food prices and shutting down public transportation. Turkmen officials have not acknowledged there is any problem, so the people of the affected regions have no idea why this happening or for how long this situation will continue. Gasoline shortages are not new to Turkmenistan. They have been occurring sporadically in recent years, usually during in late summer when harvesting of crops starts. This latest deficit is unprecedented for Turkmenistan in its duration and severity. Long lines and purchase limits By late June, there reports from Lebap and Mary provinces about lines of cars of waiting at petrol stations. Often there was not enough gasoline for everyone. By mid-July, filling stations in at least five districts and several of the big cities in Lebap Province were often completely out of higher-grade gasoline – A92 and A95. Before the end of July, Lebap authorities imposed a 10-liter limit per customer, per day on gasoline purchases. At the start of July there were areas in the northeastern Dashoguz Province that were totally without gasoline, even the cheapest and most environmentally harmful A-80 grade (which is banned in many countries, including Kyrgyzstan and Tajikistan) was unavailable. In Mary Province, A-92 and A-95 gasoline ran out in July and by early August authorities had limited purchases of A-80 to 20 liters per customer, and even that was unavailable in many areas of the province. In October, Radio Free Europe’s Turkmen service, known locally as Azatlyk, posted a video of a line of vehicles some three kilometers long outside one of the few filling stations operating along the Turkmenabad-Mary highway. Azatlyk’s sources in the region said there were similar lines at filling stations throughout the province and in the provincial capital Turkmenabad. Some people are reportedly arriving at filling stations at 4am to get a place in line as close to the pumps as possible when the stations open. In Mary Province, some car owners said they were phoning family members to bring them food and water while they waited in line. Prices going up at the pumps and other areas Turkmenistan has some of the least expensive gasoline in the world with an average of $0.428 per liter, roughly a third of the world average of $1.30 per liter. The official rate of Turkmenistan’s national currency, the manat, is 3.5 to $1. The state regulated cost of one liter of gasoline is 1.15 manat for A-80, 1.35 for A-92, 1.5 for A-95, and 1 manat for diesel. There have been incidents where filling station employees have been illegally selling gasoline at 5-6 manat per liter to those who can afford it. The shortage is having an effect on public transportation. Most buses are assigned to bringing people to and from the cotton fields once harvest starts toward the end of August or early September...