1. KAZAKH MILK AND BEEF VALUE CHAINS Analysis of the interactions, synergy and opportunities for development of the cattle sector Policy Dialogue on the Development of Kazakhstan’s Food Chains Astana, 8 September 2011

2. Сomparative advantages of the cattle sector in Kazakhstan Kazakhstan’s great grassland resources Many livestock keepers Potential for feed production Nearby markets for especially beef

3. The major constrains from economic and policy side Low productivity, resulting in high overhead costs per liter/kg beef

4. The major constrains from economic and policy side Fragmented production with high cost for aggregation

5. The major constrains from economic and policy side No clear pasture management and allocation system Tendency of government to overlook the producers of 90% of the milk and 85% of all beef

6. Possible solutions to mitigate the constraints: Production side Drastically improve day to day management of cattle Organize household farmers to reduce handling costs and improve quality Develop an ecologically sustainable pasture management system with year-round grazing and sufficient haymaking Promote the production of quality accessibly priced stock feeds

9. Possible solutions to mitigate the constraints by dairy processors’ association Set minimum standards for milk to be acceptable Payment system based on quality Provide other services to farmers besides milk marketing only Assist dairy companies to adopt international standards

10. Possible solutions to mitigate the constraints by meat processors’ and traders association Improve cold chain, especially for domestic markets Increase % slaughter under controlled conditions, give lease of markets to organized meat traders Develop a beef value chain with tracking and tracing and quality guarantees as catchment for export

12. Potential investment decisions for EBRD and other investors Make more smaller credits available to all farmers Equipment lease facilities for hay making, fodder production, milk collection, transport and processing Support private service provision to livestock sector Develop a practical training centre for fodder, milk and beef production

13. Needed policy adjustments Acknowledge household farmers as potential future medium-scale farmers Improve investment climate and conditions for feed mills Change the current pasture allocation and management system Change the rules for rural (micro)-finance and use future pasture and livestock management committees as guarantors