Kazakhstan: Livestock Value Chain Development

Agriculture, natural resources and rural development / Agro-industry, marketing, and trade - Livestock

The proposed project will provide investment finance through the branch network of Agrarian Credit Corporation JSC (ACC). It will increase the volume of financial resources available for commercially oriented livestock production and processing. It will also provide finance for commercial fodder and feed production. Through an attached technical assistance, the project will build the capacity of ACC in livestock-related credit policy; product development; procedures; outreach strategy; and in the identification, appraisal, and management of livestock sector lending. The project management office, based in ACC, will oversee implementation activities, including monitoring of relending; compliance for safeguards, gender, and financial covenants and financial auditing.

The project will have two outputs: (i) access to finance in the livestock sector increased, and (ii) capacity of ACC improved. The project outcome is livestock sector in Kazakhstan improved. The project impact is competitiveness of agro-industrial products increased.

Agriculture production is dominated by cereals, leguminous crops and oil seeds (23.0% of total agricultural output), dairy (18.0%), beef cattle and buffalo (11.0%), sheep and goats (4.5%), poultry (4.3%) and horses (3.6%). Despite its high potential, Kazakhstan remains a net importer of agricultural products. Contributing factors include low enterprise productivity and profitability, weak agricultural support system, environmental constraints, land tenure issues and poorly structured state support programs. About 60.0% of meat and 77.0% of milk produced is on household plots. Women make up 29.0% of the workforce in agriculture, and 64.0% of rural women are self-employed. This is mostly in activities directly related to agriculture.

The livestock sector can become market-driven and more profitable once (i) affordable finance for investment in processing facilities is available, (ii) producers' access to land and finance improves, (iii) adequate technical and management training is provided, and (iv) output marketing opportunities become more competitive. The proposed Livestock Value Chain Development Project will focus on the finance aspect noted in (i) and (ii). Access to financial resources is essential for commercially oriented livestock production, processing and for commercial fodder and feed production.

Access to finance in the livestock sector increased

Capacity of ACC improved