Kazakhstan has officially begun its flax harvest for 2024, with market conditions remaining quiet and buyers offering stable prices. While the harvesting process is in full swing, the flax market shows signs of hesitation, as experts note a lack of offers from farmers. Here’s a closer look at the current state of Kazakhstan's flax industry and the challenges it faces.

Flax Harvest Begins, Market Stays Quiet:

As of September 19, Kazakhstan has harvested oilseeds from 136,000 hectares, producing an average yield of 11 tons per hectare, with a total of 150,300 tons of flax harvested so far. Despite the start of the harvest, the market has remained largely inactive, with buyers offering prices in the range of 180,000 to 190,000 tenge per ton or 336€ to 355,50€ EXW. Notably, farmers have yet to make significant offers to sell their flax, leaving the market in a holding pattern.

Kazakhstan’s Flax Acreage Continues to Grow:

Kazakhstan’s flax acreage has now expanded to nearly 1 million hectares, as reported by Talgat Aldazharov, Chairman of the Production Committee at the Kazakhstan Grain Union. This increase in planting is a direct response to the intensifying competition from Russian suppliers, particularly in accessing the lucrative Chinese market. With higher demand from China, Kazakhstan’s flax industry is being pushed to scale up its production to remain competitive.

Export Declines Mark 2024:

The first half of 2024 saw a significant reduction in Kazakhstan’s flaxseed exports, dropping by 42% compared to the same period in 2023. Total flaxseed exports fell from $144.1 million to $83.3 million. This decline mirrors a broader trend in the country’s agricultural export sector, with total raw agricultural product exports plummeting by 39%, reaching just $1 billion in value during the same period.

Future Prospects for the Flax Market:

While the current market appears to be sluggish, the flax industry in Kazakhstan has the potential for future growth, particularly with increasing global demand for oilseeds. However, the country will need to navigate both the rising competition from Russian suppliers and the uncertainty in the market to strengthen its position as a key player in the global flax trade. The next few months will be crucial in determining the direction of Kazakhstan’s flax export strategy.

Kazakhstan’s flax industry is at a critical juncture, with the 2024 harvest underway but market activity still muted. As competition from Russia intensifies and global demand for flaxseed continues to shift, Kazakhstan’s ability to adapt will be essential for maintaining its export markets. Whether the country can overcome these challenges and regain momentum remains to be seen.

Click here to reach our trading platfrom CMBroker