The Role of Fertilizer in Transforming the Agricultural ... · The Role of Fertilizer in...

The Role of Fertilizer in Transforming the

Agricultural Economy in the Kyrgyz Republic

by

Dilshod Abdulhamidov Kyrgyz Agri-Input Enterprise Development Project

for

P.O. Box 2040 Muscle Shoals, Alabama 35662, USA

www.ifdc.org

and

October 2014

ii

TableofContents

Page

Abbreviations and Acronyms ........................................................................................................ iv

Executive Summary ........................................................................................................................ v

Methodology and Approach ........................................................................................................ viii

1. Overview of the Agriculture Sector in Kyrgyzstan ................................................................... 1

Wheat ........................................................................................................................................ 3

Maize......................................................................................................................................... 5

Potato ........................................................................................................................................ 5

2. Role of Fertilizer Use in Transforming the Agricultural Economy ........................................... 6

Fertilizer Supply by Nutrients and Products ............................................................................. 7

Fertilizer Production Potentials................................................................................................. 9

3. Organic Fertilizer Consumption .............................................................................................. 10

Organo-Mineral Fertilizer Consumption ................................................................................ 10

Consumption of Organic Fertilizer ......................................................................................... 11

4. Structure of Fertilizer Market .................................................................................................. 13

The Role of the Government in Fertilizer Supply .................................................................. 17

Supply of Fertilizer From Russian Federation ........................................................................ 20

Import of Fertilizer From the Republic of Uzbekistan ........................................................... 21

Import of Fertilizer From Republic of Kazakhstan ................................................................. 22

5. Fertilizer Consumption by Oblasts .......................................................................................... 23

Fertilizer Use in Wheat Production ......................................................................................... 25

Fertilizer Use in Maize Production ......................................................................................... 27

Fertilizer Use in Potato Production ......................................................................................... 29

Fertilizer Consumption by Secondary Nutrients ..................................................................... 30

6. Fertilizer Use by Farm Size Classification .............................................................................. 30

Fertilizer Use by Farm Size for Wheat Production ................................................................. 31

Fertilizer Use by Farm Classification for Maize Production .................................................. 32

Fertilizer Use by Farm Classification for Potato Production .................................................. 32

7. Value-Cost Ratio of Fertilizer Use on Crop Yields ................................................................. 33

Looking Back: VCR Then and Now ....................................................................................... 39

iii

8. Yield Gap Levels and Limiting Factors in Food Security ....................................................... 40

Yield Gap Levels in Wheat Production .................................................................................. 42

Yield Gap Levels in Maize Production ................................................................................... 45

Summary of Results and Recommendations ................................................................................ 51

Recommendations ................................................................................................................... 52

References ..................................................................................................................................... 55

Appendix A. Fertilizer Requirements by Oblasts ........................................................................ 56

Appendix B. Livestock Manure Production Rates and Nutrient Content .................................... 57

Appendix C. Farm Machinery Deficits in Kyrgyz Republic ................................................... 5960

iv

AbbreviationsandAcronyms

AAK Association of Agribusinessmen of Kyrgyz Republic "Jer Azygy"

AN Ammonium Nitrate

DCPP Department of Chemicalization and Plant Protection

FAO Food and Agricultural Organization

IFDC International Fertilizer Development Center

KAED Kyrgyz Agro-Input Enterprise Development project

kg kilogram

km kilometer

KZ Republic of Kazakhstan

MAP Monoammonium Phosphate (Ammophos)

MAWR Ministry of Agriculture and Water Resources

mt metric ton

NGO Non-Governmental Organization

NSC National Statistical Committee of Kyrgyz Republic

RF Russian Federation

SCEPVR State Commission for Crops Variety Testing and Registration

SIDA Swedish International Development Cooperation Agency

UZ Republic of Uzbekistan

VCR Value-Cost Ratio

WB World Bank

v

The Role of Fertilizer in Transforming the Agricultural

Economy in the Kyrgyz Republic

ExecutiveSummary

This report was produced as part of the Kyrgyz Agro-Input Development Follow-on project

(KAED) implemented by the International Fertilizer Development Center (IFDC) for the United

States Agency for International Development (USAID) and draws on trial and survey data from

the project in addition to official statistics of the Kyrgyz Republic.

FertilizerSupplyandConsumption

Fertilizer consumption levels in the Kyrgyz Republic fall far short of what the country’s soils

and crops require. Annually, less than half of the required nitrogen is applied to the soil.

During the last 10 years, the use of inorganic phosphate fertilizer did not surpass 8.5 percent

of the amount required. The use of inorganic potash fertilizer has been virtually nonexistent

since 2005, representing only 0.05 percent of the amount required.

Imported fertilizer products mostly originate in Uzbekistan, Kazakhstan and the Russian

Federation. These imports face high transportation costs, which add a considerable amount to

retail prices. There are more than 20 private input companies and additional private

entrepreneurs involved in fertilizer supply to the country.

Farmers in southern Kyrgyzstan use fertilizer more intensively than those in the north; in

terms of inorganic fertilizer, southern farmers use 48.2 percent of the required amount,

compared to 10.8 percent for northern farmers. The local price of nitrogen fertilizer in local

markets in northern Kyrgyzstan is at least 91 percent higher than producers’ prices and

111 percent higher at minimum in southern Kyrgyzstan.

FertilizerUseforWheat,MaizeandPotatoProduction

Wheat is mostly grown on a low-input and low-output system in northern Kyrgyzstan; only

33.7 percent of farmers use fertilizer in the north, compared to 82.7 percent of farmers in the

south.

vi

Maize is the most commercial crop among cereals in the Kyrgyz Republic due to relatively

higher output prices and the potential to export the crop. A total of 68.3 percent of farmers

(covering 80.1 percent of land area) use fertilizer for maize production. Inorganic phosphate

fertilizer is applied on only 36.5 percent of maize area.

Potato is one of the most important food security crops, and it is one of the staple foods for

the majority of the country. Organic and/or inorganic fertilizer is used for 88.3 percent of

potato area. Inorganic nitrogen and phosphate fertilizers are applied on about 31.6 percent

and 24.4 percent of potato area, respectively.

FertilizerUsebyFarmScales

More than 70 percent of wheat-producing farmers are smallholder and household farmers.

The proportion of farms that use organic and/or inorganic fertilizer ranges from 45.4 percent

(small-scale farmers) to 63.5 percent (large-scale farmers). Smallholders and households use

more nutrients per hectare for wheat production than average-scale farmers. However, no

observable increase in yields is observed, which may be explained by other factors such as

the inappropriate timing of application, seed spacing, poor varieties and cultural farming

practices.

About 90 percent of maize producers in the country grow on a land area of 2 hectares (ha) or

less. Large farms receive 50 percent higher yields compared to smallholders and households

due to their more extensive use of phosphate nutrients and, to a greater extent, their use of

hybrid seeds and better agricultural practices.

About 97 percent of farmers producing potato are smallholders. They use twice as much

nitrogen and phosphate nutrients compared to large farms. However, the yields are about

50 percent lower compared to large-scale farmers. Again, as with wheat and maize, this can

be attributed to their improper use of fertilizer, seed quality and cultivation practices.

The yields of wheat, maize and potato in the country are negatively correlated to farm land

size. One of the limiting factors is that large-scale farming approaches, management and

activities cannot be transferred to small fields. High service costs for machinery and inputs

would lead smaller farms to lower productivity and increase variable expenses per hectare.

vii

Value‐CostRatioofFertilizerUseonCropYields

As the results on test fields show, using complete (NPK) fertilizer when poor quality seed is

used is inefficient and risky for all selected crops and gives a value-cost ratio less than 2.

Value-cost ratios for complete (NPK) fertilizer use for the three crops described in this paper

range from 1.82 for improved wheat, 2.19 for hybrid maize, and 4.99 for quality potato

seeds.

VCRs of selected crops for 2013 prices are lower compared to 2002 prices. This means that

fertilizer price increases have been much higher compared to output prices for the last 10

years.

YieldGapLevelsandLimitingFactorsinFoodSecurity

More than 90 percent of farmers who use fertilizer are unaware of or reluctant to apply the

required amount of nutrients (NPK) to the soil to achieve higher yields.

Many wheat farmers believe that using complete (NPK) fertilizer inputs to obtain maximum

yield in wheat production will not lead to greater income. A high yield gap (79 percent from

attainable yield) is observed among smallholders with an average area less than 1 ha. Factors

are both socio-economic and technical due to the fact that increases in yield response per

hectare with poor-quality seed provide insufficient additional income to cover fertilizer costs.

Farmers who use best practices and complete fertilizer for maize production are large-scale

farmers and account for about 2 percent of those surveyed. The large share of farmers (more

than 80 percent) who use inappropriate seeds and limited nutrients are smallholders and

households that, on average, cultivate maize on less than 1 ha. Yield gaps of these farmers

range from 47.7 to 69.8 percent.

The majority of potato growers are households and smallholders, and only 1.3 percent of

them use complete nutrients with proper seeds. Yield gaps for those farmers who do not

apply full nutrients range from 45.4 to 74.8 percent. Even assuming all elite seeds are

multiplied to C4 generation with a standard seed multiplication ratio of 1:4, the required

seeds cover about 8,500 ha, which is less than 11 percent of the total potato area in the

country.

viii

Recommendations

The government of Kyrgyzstan should negotiate with international partners to arrange

wholesale prices for local dealers without engaging in distribution, which could crowd out

the private sector. The relatively high cost of phosphate and potash fertilizer imports due to

high transportation costs may be alleviated to some extent by improved infrastructure

investment and increased demand arising from continued farm demonstration of best

agricultural practices.

Further decentralization and increasing of local governments’ capacities would increase

farmers’ knowledge, skills and capacities to increase food production and improve food

security. Empowering capacities of local governments would have positive impacts. Stronger

decentralization can also work in tandem with improved extension services, which would

overcome the knowledge gaps constraining Kyrgyz agriculture that are described in detail in

this paper.

Voluntary land consolidation can offset the effects of fragmentation and is widely considered

a viable means to improve farm productivity by making knowledge, inputs and machinery

more readily available to farmers. This could also provide greater access to wholesalers and

supply chains for small-scale farmers.

MethodologyandApproach

The following methods of data collection and analysis were used:

Collection of available information from government institutions such as the National

Statistics Committee, Ministry of Agriculture and Water Resource Departments.

Interviews with local agro-input dealers on fertilizer imports.

Review of other publications on the agriculture sector in the Kyrgyz Republic.

Analysis of the KAED/IFDC survey data.

Only limited general information on fertilizer use exists in national statistics and agricultural

departments and governments. Fertilizer use by nutrient has not been recorded by any

government agency. The KAED/IFDC survey was conducted in October and November 2013. A

structured questionnaire was used to elicit information from farmers and was administered by

ix

KAED employees to 100 farmers in each of the oblasts, resulting in a total of 700 farmers who

were sampled and disaggregated by crops, oblasts, farm size, nutrient use and yields.

1

1.831.37

2.462.83

3.80

5.144.69 4.79

6.206.47

7.1546.3%

34.2%

28.5% 28.7%26.9%

23.5%

18.8%17.5% 16.6% 17.5%

15.2%

24.6%

18.8%

15.5%16.2%

15.1%13.2%

10.0% 9.0% 8.4% 8.0%

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

1996 2000 2005 2006 2007 2008 2009 2010 2011 2012 2013

Bilion Dollars

GDP Ag.GDP Crop GDP*

The Role of Fertilizer in Transforming the Agricultural

Economy in the Kyrgyz Republic

1.OverviewoftheAgricultureSectorinKyrgyzstan

The Republic of Kyrgyzstan is a landlocked country in Central Asia bordering Kazakhstan,

Uzbekistan, Tajikistan and China. The 2012 population census estimated that the country has a

population of approximately 5.6 million. About 65 percent of the population lives in rural areas.

Kyrgyzstan is categorized as a low-income, food-deficit country that relies on wheat imports to

cover one-quarter of its consumption needs. Compared to the south, the northern part of the

country is relatively more industrialized, and farm activities are more fully mechanized. Southern

Kyrgyzstan is a highly populated area with limited availability of arable land – about 0.4 ha of

arable land per capita. The growth in GDP of the agricultural sector has been slower compared to

other sectors, and its share fell from 46.3 percent in 1996 to 15.2 percent in 2013 (Figure 1). The

field crop subsector accounted for about 50 percent of agricultural GDP.

Source: NSC, Ministry of Finance. *KAED/IFDC estimation

Figure 1. Kyrgyz Republic GDP and Agriculture Share

2

Agriculture has always been a vital sector of the Kyrgyz economy and should remain an

important focus of future support. Since the reorganization and distribution of 75 percent of land

to private individuals after the country’s independence, many small family farms and small farm

enterprises have become the engine of agricultural growth. Workers displaced during the

collapse of the industrial and service sectors after independence shifted their efforts to

agriculture to ensure food security, home consumption and physical survival. Labor productivity

declined due to the large increase in the agricultural labor force and the widespread lack of

farming know-how among the newly privatized farmers.

As shown in Table 1Table 1, more than 1 million legal entities and smallholder households are

involved in agriculture. The reduction of government and collective farms is apparent while

private enterprise farms have been steadily increasing over the years.

Table 1. Number of Agricultural Entities in the Kyrgyz Republic in 2007-2011

2007 2008 2009 2010 2011 Government & collective farms

1,758 (0.2%)

4,884 (0.5%)

1,390 (0.1%)

1,111 (0.1%)

621 (0.1%)

Smallholder households 726,632 (69.1%)

726,632 (69.0%)

726,632 (69.4%)

726,632 (68.6%)

726,632 (67.8%)

Private farm enterprises 323,555 (30.8%)

321,856 (30.6%)

318,815 (30.5%)

331,059 (31.3%)

344,492 (32.1%)

Total 1,051,945 1,053,372 1,046,837 1,058,802 1,071,745 Source: The NSCKR, 2012

Households hold only about 8.3 percent of the country’s agricultural land and account for about

25 percent of crop production value nationwide. Private farmers, with 85 percent of agricultural

land, remain the dominant source in crop production. There are significant constraints in the

agriculture sector – notably poor agricultural management practices, improper use of fertilizers

and seeds, resource constraints of small farms, and inadequate access to production technologies

using agricultural machinery

Wheat, maize and potato are the main staple crops in the Kyrgyz Republic and in total account

for about 43 percent of the arable land in the country. Wheat accounts for the largest share but is

steadily decreasing. Factors resulting in the reduction of wheat areas include low prices for the

3

crop on the Kyrgyz market and the increase in planted areas of more profitable crops and forage

crops for cattle livestock.

In cereal markets in Central Asia, including Kyrgyzstan, quality, quantity and timing constraints

favor large-scale operations that are able to accommodate these requirements. Thus, private farm

enterprises, having relatively more access to mechanical operations resources, are involved in

low-value staple food crops that account for more than 34 percent of total income from

agricultural fields (Figure 2).

Figure 2. Arable Land of Kyrgyz Republic and Land Share of Selected Crops

Wheat

In Kyrgyzstan, wheat is the main staple, most important crop and is allocated the most land in

almost every part of the country, accounting for about 27.8 percent, or 325,000 ha, of cultivated

land. The average yield of winter wheat is up to 2.6 mt/ha in favorable years, which are much

less than the attainable yields. Wheat production occurs on irrigated land, which raises

production costs. There are a few factors, including fertilizer use, that are limiting yields in the

wheat sector – such as farm size, access to modern machinery and agricultural know-how – that

will be reviewed in the following chapters.

1,2121,134 1,129 1,160

1,170 1,146 1,159 1,16641.7%

36.3%31.7%

33.8% 34.4% 32.9% 32.6%27.8%

5.4%6.4%

6.7%

6.6% 6.7% 6.4% 6.4% 8.2%5.7% 7.2% 7.7%

7.2% 7.5% 7.4% 7.3% 7.0%

0

200

400

600

800

1,000

1,200

1,400

2000 2006 2007 2008 2009 2010 2011 2012

Thsd. h

a

Arable Land Wheat Maize Potato

4

To meet the domestic demand, Kyrgyzstan regularly imports wheat from neighboring

Kazakhstan and Russia. The trend for increasing wheat and wheat flour imports (Figures 3 and 4)

results from Kazakhstan’s comparative advantages of relatively low production costs and

favorable natural conditions for growing high-quality hard spring wheat. The gluten quality and

content of local wheat is inadequate to produce good quality bread. Therefore, domestic flour

mills purchase and process Kazakh wheat and blend it with up to 30 percent Kyrgyz wheat to

produce flour for the local market. There are no import duties on Kazakh flour to protect local

mills.

Regardless of the volume of domestic production, the price for wheat is therefore largely

dependent on international prices, especially those in Kazakhstan and Russia. Low prices of

wheat in recent years have been forcing some farmers in Kyrgyzstan to shift to other crops.

However, many large farmers growing wheat do not shift because other crops, especially maize,

require modern machinery and additional inputs that they cannot afford.

Source: NSCKR, 2013

Figure 3. Wheat Grain Trade Balance in Kyrgyz Republic (thsd mt)

0

200

400

600

800

1000

1200

1400

1600

2009 2010 2011 2012

Domestic Production Import

5

Source: The National Statistical Committee, 2012

Figure 4. Wheat Flour Import (thsd mt)

Maize

In the past, important land resources were allocated to the production of maize for grain and

livestock feed. Currently, maize is becoming a major commercial crop in Kyrgyzstan due to

higher yields and grain prices compared to wheat. The land area covered by maize increased

from 65,000 ha to about 95,000 ha during the last 10 years, accounting for 8.2 percent of

cultivated land in 2012, with average yields of 6.0 mt/ha. During the last few years, modern

hybrids have become popular among maize producers. A KAED/IFDC project has supported

farmers using high-yielding hybrids developed by Pioneer.

Potato

In terms of production volume, potatoes are the dominant vegetable in Kyrgyzstan. Compared to

Tajikistan and Uzbekistan, Kyrgyzstan has more favorable land and soil for potato production.

About 25 percent of all farmers produce potatoes. More than 95 percent of potato farms are

smallholder enterprises and household plots. Potatoes are the second most important crop for

food security after wheat and covers about 7 percent of the cultivated land with average yields of

16 mt/ha.

0

20

40

60

80

100

120

140

160

1998 1999 2000 2001 2002 2009 2010 2011 2012

6

Source: The National Statistical Committee, 2012

Figure 5. Yield of Selected Crops in Kyrgyz Republic (mt)

2.RoleofFertilizerUseinTransformingtheAgriculturalEconomy

Agriculture can no longer rely solely on the inherited advantages of Kyrgyzstan – climate, land

and water. However, many Kyrgyz farmers are unaware of the potential impact of complex

fertilizers and high-quality crop production products. In order to prevent technological isolation,

Kyrgyzstan’s agriculture sector must embrace technology, especially within the agro-input

subsector. Kyrgyzstan relies on imported fertilizer to supplement its domestic production. Before

2010, more than 90 percent of fertilizer imports originated in Uzbekistan. While its market share

has decreased, Uzbekistan still accounts for most of the imports into Kyrgyzstan (Figure 6).

2.55 2.46 2.362.07 2.0 1.94

2.632.17 2.14

1.68

6.25

4.92

5.92 5.91 5.9 5.86 6.0 5.93 5.9 6.02

13.713.1

15.5 15.215.7 15.7 15.9 15.8 16.1 15.9

1990 1998 2003 2006 2007 2008 2009 2010 2011 2012

Metric Ton per ha

Wheat Maize Potato

7

Figure 6. Market Share of Fertilizer Import by Countries in 2011-2013 ( percent)

FertilizerSupplybyNutrientsandProducts

The fertilizer situation has been worsening in Kyrgyzstan since the country gained independence,

and application of fertilizer has dramatically decreased since 1990. In 2013, the application of

fertilizers decreased to 27.7 percent of the amount required (Figure 7).

Source: DCPP, 2013

Figure 7. Fertilizer Requirements and Consumption as Product Weight in Kyrgyzstan, 1990-2013 (thousand mt)

60%

30%

10%

Uzbekistan Russia Kazakhstan

300319.9 328.6 337.6 338 339 340.8 340 340.8 340.8 340.8 340.8

300191.5

(59.9%)

100.4(30.6%) 85

(25.2%)

89(26.9%)

84.5(24.9%)

99.4(29.2%)

94.9(27.9%)

90.8(26.6%)

107.7(31.6%) 80.2

(23.5%)

94.3(27.7%)

0

50

100

150

200

250

300

350

400

1990 1995 2000 2005 2006 2007 2008 2009 2010 2011 2012 2013

mt

Fertilizer requirements Fertilizer applied

8

The amount of fertilizer required in physical weight is updated annually by Kyrgyzstan’s

Department of Chemicalization and Plant Protection (DCPP) using crop area multiplication to

determine the nutrient requirements of each crop per hectare. Furthermore, the total sum amount

is expressed in terms of ammonium nitrate, ammophos and potassium chloride. Nutrient removal

rates and fertilizer nutrient requirements of each crop by oblast are presented in Appendix A.

The reduction in fertilizer use is only the tip of the iceberg in explaining Kyrgyzstan’s fertilizer

issues. According to soil analyses by the IFDC/KAED project in 2003, the recommended

application of potash and phosphate fertilizers ranges from 120 kilograms (kg)/ha to 250 kg/ha

for the selected crops. However, in reality, these phosphate (and especially potash) fertilizers are

rarely applied in Kyrgyzstan. Farmers no longer adhere to balanced application of fertilizer.

According to the Association of Agribusinessmen of Kyrgyzstan (AAK), more than 95 percent

of fertilizer used is nitrogen fertilizer (ammonium nitrate), 4.5 percent is phosphorus (ammonium

phosphate, superphosphate) and 0.5 percent is potash. It should be noted that these results were

obtained from the observation of 700 farmers in all oblasts (four rayons) of Kyrgyzstan. It is

inferred that most other Kyrgyz farmers have similar habits concerning input use.

Table 2 presents fertilizer requirements and use by nutrient. The majority of farmers apply

nitrogen fertilizer, and 46.7 percent of the amount of fertilizer required was used in 2003. During

the last decade, the highest application/requirement ratio (7.2 percent) for phosphate fertilizer

occurred in 2010. Potash fertilizer use was about 200 times less than the amount needed in 2003-

2005. The application of potash has rarely been observed since 2005. Only a small portion of

farmers used inorganic potash fertilizer from 2007-2009 for fertilizer use trials. It has been

argued that Kyrgyzstan’s soils have enough phosphate and potash nutrients without adding

fertilizer. However, the amount of these nutrients in the soil should be explored and discussed

when more data is available.

9

Table 2. Fertilizer Requirements and Consumption in Kyrgyzstan in 2002-2011

Products 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Nitrogen

Requirement 66,798 67,253 67,708 68,162 68,235 68,437 68,802 68,638 68,800 68,800

Applied 9,232

(13.8%) 31,383 (46.7%)

27,232(40.2%)

29,589(43.4%)

26,842 (39.3%)

26,141(38.2%)

22,530 (32.7%)

24,523 (35.7%)

25,252(36.7%)

29,952(43.5)

Phosphate (P2O5 equivalent)

Requirement 43,118 43,412 43,705 43,999 44,046 44,176 44,412 44,306 44,410 44,410

Applied 205

(0.5%) 1,810

(4.2%) 1,684

(3.9%)2,034

(4.6%)1,652 (3.8%)

2,601 (5.9%)

1,747 (3.9%)

2,301 (5.2%)

3,200 (7.2%)

3,796(8.5%)

Potash (K2O equivalent)

Requirement 3,908 3,934 3,961 3,987 3,992 4,004 4,025 4,015 4,025 4,025

Applied 46

(1.2%) 18

(0.5%) 8

(0.2%)0

(0%) 0

(0%) 1

(0.02%)1

(0.02%) 1

(0.02%) 0

(0%) 0

(0%)

Source: FAOSTAT (based on inorganic fertilizer) and author estimations

As Table 3 presents, nutrient removal of three selected crops accounts for a total of 96,538 mt,

even though these crops cover only 43 percent of arable area. More than 45 mt of K2O are

annually removed and are not properly replaced with inorganic fertilizer for years.

Table 3. Nutrient Removal at Country Level for Selected Crops (mt)

Crop Production

(mt) Nutrient removal kg/t*

N P2O5 K2O Total N P2O5 K2O Total

Wheat 540,531.2 27.2 10.2 34.5 71.9 14,702 5,513 18,648 38,863 Maize 578,294.1 28.6 10.2 28.7 67.5 16,539 5,899 16,597 39,035 Potato 1,312,699.3 4.4 2 7.8 14.2 5,776 2,625 10,239 18,640 Total 2,431,524.6 37,017 14,037 45,484 96,538 Source: Handbook of Agriculture, ICAR

FertilizerProductionPotentials

The Chinese company China Machinery Engineering Corporation plans to build a fertilizer plant

for production of nitrogen fertilizers at Tash-Kumyr, Jalalabad Oblast. A feasibility study of a

fertilizer plant using coal as feedstock was prepared by a Chinese company, CITIC, in 2005-

2006. The construction of the plant is valued at $350 million and the design capacity of the plant

is 310 mt of nitrogen fertilizer per year. The memorandum of exclusive cooperation in

construction of the mineral fertilizer plant was signed by the Kyrgyz Ministry of Agriculture and

Water Resources (MAWR), China's Machine Engineering Corporation and Mineral Fertilizers

10

Plant Ltd. on July 2012. According to the agreement, the Chinese company will transfer a 30-

percent stake in the charter capital of the Mineral Fertilizers Plant Ltd. to the Kyrgyz

government.

Some argue that this will negatively impact the environment. Considering existing fertilizer

production in neighboring countries Uzbekistan and Kazakhstan, further studies should be done

to determine the environmental impacts and if the production is economically viable.

3.OrganicFertilizerConsumption

Organo‐MineralFertilizerConsumption

Due to the rise in price of fertilizers and the closing of the border with the Republic of

Uzbekistan in Kyrgyzstan in 2010, there was increase in the use of organo-mineral fertilizers and

their distribution among farmers. Input dealers have been actively working to expand

importation of these fertilizers into the country, and in 2012 the supply of organo-mineral

fertilizers increased up to 350 mt.

More than 40 types of organo-mineral fertilizers exist in the market. More than 70 percent of

supplied organo-mineral fertilizer is used in northern Kyrgyzstan. The domestic company Adaid

LLC established local production of the organo-mineral fertilizer “Kyrgyz Humate.” The

fertilizer is recommended for use with irrigation on all crops with an application rate of 1 liter

(L) per 1,000 L of water per hectare and a cost of 100 soms/L (~$2/L). Many users compare this

type of fertilizer with AN and give preference to organo-mineral fertilizer due to its very low

prices. As DCPP reported, using the local organo-fertilizer “Kyrgyz Humate” increased the

potato yields in Issyk-Kul Oblast by 50 percent. However, due to the unavailability of data on the

nutrient content of this type of fertilizer and its insignificant use at around 350mt, the use of

organo-mineral fertilizer nutrients is not included in this report.

11

Figure 8. Supply of Organo-Mineral Fertilizer in Kyrgyz Republic (mt)

ConsumptionofOrganicFertilizer

Poor soil fertility is becoming a major constraint to agricultural production in Kyrgyzstan.

Insufficient application of fertilizer not only hampers the productivity but also the quality of the

soil. For the last 25 years, soil nutrient depletion has been significant due to the negative balance

of fertilizer use. Humus content in the topsoil, which is important for fertility, ranges from just 1-

3 percent (AAK, 2013).

Current agricultural methods have been stripping increasing amounts of nutrients from the soil,

leading to a reduction in humus reserves, which in turn leads to a significant loss of soil fertility,

to water erosion and to soil degradation. Humus is a reserve fund of nutrients; to maintain and

replenish soil humus, it is necessary to follow crop rotations with perennial grasses. In addition,

organic fertilizers should be applied to the soil.

Historically, manure application has been common in Kyrgyzstan, and many farmers maintain

organic matter of the soil using manure. Manure is the most important organic fertilizer in the

country. Numerous trials before 1992 suggest that increasing crop yields, especially in the non-

chernozem (non-black) zone, largely depends on the quality and quantity of manure applied.

5

53

350 350

0

50

100

150

200

250

300

350

400

2008 2011 2012 2013

Metric Ton

12

According to 1992 trials, 20-30 mt/ha of manure increased cereal grains by 0.6-0.7 mt/ha and

potato yields by 6-7 mt/ha.

As Table 4 shows, 442,800 mt of organic fertilizer were applied in 2010, which is almost

32 percent less than in 2006 (Table 4). However, some growth in the use of organic fertilizers

has been observed since 2011.

Table 4. Organic Fertilizer Use in the Kyrgyz Republic in 2006-2012 (thsd mt)

Regions 2006 2007 2008 2009 2010 2011 2012

Total Kyrgyz Republic 649.7 429.8 697.7 375.9 393.2 401.0 442.8

Chuy Oblast 34.6 40.2 59.0 48.8 33.1 22.7 28.8

Issyk-Kul Oblast 34.4 20.0 142.0 81.1 146.0 151.4 185.0

Naryn Oblast 96.2 82.8 99.6 88.6 85.6 100.2 104.6

Talas Oblast 175.2 22.8 24.8 25.8 31.9 33.4 31.2

Subtotal Northen Oblasts 340.4 165.8 325.4 244.3 296.6 307.7 349.6

Osh Oblast 296.2 229.1 298.1 32.3 28.6 25.2 24.3

Jalal-Abad Oblast 5.5 26.5 69.4 94.4 58.3 57.2 63.9

Batken Oblast 7.6 8.4 4.8 4.9 9.7 10.9 5.0

Subtotal Southern Oblasts 309.3 264.0 372.3 131.6 96.6 93.3 93.2

The livestock subsector represents about half of the agricultural GDP. Because more than

90 percent of farmers from the survey own livestock – such as cattle, sheep, goats and poultry –

they can use organic fertilizer produced by their own farms or nearby. Table 5 represents the

approximate organic fertilizer production capabilities of major livestock producers in the

country. These physical and nutrient estimates have been done with livestock that spend the

majority of their time feeding in pastures, thus producing less retrievable manure than those who

spend most of their time in barns (see Appendix B, Tables B.1-B.4). One of the reasons that

farmers apply less than 5 percent of their livestock’s capacity of manure is that keeping livestock

in pastures makes it difficult to obtain the manure. The other reason is that the largest share of

available manure is used for heating houses during winter because it is much cheaper than

buying coal in the market.

13

Table 5. Approximate Quantity, Composition and Value of Manure (in solid weight) Produced by Major Livestock in Kyrgyz Republic in 2013 (thsd mt)

Annual

Production Nitrogen

(N) Phosphorus

(P2O5) Potassium

(K2O) Calcium

(Ca) Magnesium

(Mg) Organic Matter

Kyrgyz Republic 8,717.7 175.1 129.8 207.9 262.6 63.3 5,688.9

Chuy Oblast 1,445.1 29.8 22.0 33.2 42.9 10.3 963.2

Issyk-Kul Oblast 1,242.2 25.0 18.5 29.7 37.5 9.0 808.7

Naryn Oblast 1,042.1 20.5 15.3 25.9 31.9 7.7 660.2

Talas Oblast 528.8 10.5 7.8 13.2 16.2 3.9 333.1

Subtotal Northen Oblasts

4,258.2 85.8 63.5 101.9 128.6 31.0 2,765.1

Osh Oblast 1,936.2 38.8 28.8 45.6 58.0 14.0 1,277.7

Jalal-Abad Oblast 1,756.1 35.2 26.1 42.0 52.9 12.8 1,144.3

Batken Oblast 767.2 15.3 11.4 18.3 23.1 5.6 501.8

Subtotal Southern Oblasts

4,459.6 89.3 66.3 105.9 134.0 32.3 2,923.8

4.StructureofFertilizerMarket

Imported fertilizers are supplied to Kyrgyzstan by Uzbekistan, Russia and Kazakhstan. Figure 10

represents the flow of fertilizer from these countries. All fertilizer is imported via railroad. Part

of the fertilizer from Uzbekistan is imported to the south via railroad without border transfer,

especially from FerganaAzot. Fertilizer is also imported from Kazakhstan by rail. Import tariff

rates account for an insignificant share (0.15 percent) of transportation and distribution expenses.

About 70 percent of fertilizer is distributed directly to large farms from the warehouses, and the

remaining 30 percent is distributed to small farmers in all major markets and regional cropping

areas (AAK, 2013). More than 20 firms and many private entrepreneurs are involved in fertilizer

import and supply to the country. Main fertilizer importers are listed on Table 6.

14

Table 6. Fertilizer Importers to Kyrgyz Republic in 2013

Russian Federation Kazakhstan Uzbekistan

Agrokhimprom LLC Agrokhimiya LLC Agromet LLC Albico LLC Albi-Agro LLC Agropromishlennaya Pervaya LLCAlber LLC Agro-League LLC Fazenda Friend LLC JSC Geya Phosagro LLC Hartley Trade LLC Khimteks LLC Agrtostyle LLC Khimteks LLC Albi-Agro LLC Albico LLC Oligarch Trade LLC Hermes Treade LLC RR Compani LLC Negotiant LLC Yulita LLC Source: MAWR, 2013

In addition, some companies invest their available funds for import and wholesale activity at the

end of the year and before the beginning of the cropping season, even if fertilizer is not their

main business activity.

The price of fertilizer depends on costs accrued by road transportation, storage, handling,

distribution and marketing. For example, increases in ammonium nitrate (AN) prices in the

country range from 90.7 to 222 percent above the initial producer’s price depending on the

originating country and the oblasts where the products are sold (Table 7Tables 7 and 8).

Some input dealers do not have the capacity and time for storage, so they sell fertilizer at

wholesale prices a few days after it is imported. As Table 7 shows, AN fertilizer from Russia is

sold for $393/mt during December and January within a few days of being imported. Further, the

price is increased 19.6 percent by retail dealers in Chuy Oblast due to storage costs. The retail

fertilizer price for Uzbek and Kazakh dealers is increased from wholesale prices by 14.5 percent

and 13.5 percent. In Osh Oblast, wholesale dealers transport and sell for higher prices. For

example, the wholesale price of Russian AN in Osh Oblast is $462.35/mt, compared to

$393.13/mt in Chuy Oblast (Table 7).

15

Table 7. Supply Chain Costs Components of Fertilizer in Chuy and Osh Oblasts

Costs

% of Retail Price Cumul. Costs

% of Retail Price Cumul. Costs

% of Retail Price Cumul.

Chuy Oblast (North)

Producer price, U.S. $/mt $210.00 41.4% $210.00 $255.00 52.4% $255.00 $310.00 58.8% $310.00

Transportation costs + customs duties

$108.37 21.4% $318.37 $92.65 19.1% $347.65 $58.83 11.2% $368.83

Overhead costs $9.30 1.8% $327.67 $3.20 0.7% $350.85 $4.42 0.8% $373.25

Storage costs $11.27 2.2% $338.94 $4.84 1.0% $355.69 $5.21 1.0% $378.46

Finance costs $30.50 6.0% $369.44 $21.34 4.4% $377.03 $22.71 4.3% $401.17

Operating costs $5.57 1.1% $375.01 $4.19 0.9% $381.22 $4.47 0.8% $405.64

Total margins $131.94 26.0% $506.95 $105.02 21.6% $486.24 $121.98 23.1% $527.62

Wholesale price, $/mt $393.13 $372.43 $424.16

Local market price, $/mt $506.95 $486.24 $527.62

Osh Oblast (South)

Retail price, U.S. $/mt $210.00 37.6% $210.00 $255.00 47.4% $255.00 $310.00 53.5% $310.00Transportation costs + customs duties

$157.10 31.0% $367.10 $141.38 26.3% $396.38 $107.56 18.6% $417.56

Overhead costs $8.63 1.7% $375.73 $2.89 0.5% $399.27 $3.39 0.6% $420.95

Storage costs $9.27 1.8% $385.00 $3.93 0.7% $403.20 $4.26 0.7% $425.21

Finance costs $34.65 6.8% $419.65 $24.19 4.5% $427.39 $25.51 4.4% $450.72

Operating costs $4.91 1.0% $424.56 $3.42 0.6% $430.81 $4.87 0.8% $455.59

Total margins $134.09 26.5% $558.65 $107.07 19.9% $537.88 $123.76 21.4% $579.35

Wholesale price, $/mt $462.35 $441.65 $493.38

Local market price, $/mt $558.65 $537.88 $579.35

16

Table 8. Supply Chain Costs Components of Fertilizer by Oblasts

Fertilizer Retail Price Component

Ammonium Nitrate (Tolyatti, Russia)

Ammonium Nitrate (NavoiAzot, Uzbekistan)

Ammophos (Kazphosphate, Kazakhstan)

Costs

% of Retail Price

Cum. Costs Costs

% of Retail Price

Cum. Costs Costs

% of Retail Price

Cum. Costs

Import Parity Price Costs

Producer Price, U.S. $/mt $210.00 41.42% $210.00 $255.00 52.44% $255.00 $310.00 58.75% $310.00

Railroad Transportation costs:

Russia $19.84 3.91% $229.84 $0.00 0.00% $255.00 $310.00

Uzbekistan $229.84 $30.05 6.18% $285.05 $310.00

Kazakhstan $53.91 10.63% $283.75 $27.98 5.75% $313.03 $24.21 4.59% $334.21

Kyrgyzstan $6.13 1.21% $289.88 $6.13 1.26% $319.16 $6.13 1.16% $340.34

Custom duties $1.00 0.20% $290.88 $1.00 0.21% $320.16 $1.00 0.19% $341.34

Total Rail Transporation, U.S. $/mt $80.88 15.95% $290.88 $65.16 13.40% $320.16 $31.34 5.94% $341.34

Unloading/Uploading $7.00 1.38% $297.88 $7.00 1.44% $327.16 $7.00 1.33% $348.34

Import Parity Price $297.88 $327.16 $348.34

Chuy Oblast

Road Transportation $20.49 4.04% $318.37 $20.49 4.21% $347.65 $20.49 3.88% $368.83

Storage, Distribution, Net Margin $188.58 37.20% $506.95 $138.59 28.50% $486.24 $158.79 30.10% $527.62

Retail Price, U.S. $/mt $506.95 $506.95 $486.24 $486.24 $527.62 $527.62

Issyk-Kul Oblast




Naryn Oblast




Osh Oblast




Jalalabad Oblast




Batken Oblast




A basic problem facing fertilizer traders across the country is that fertilizer requires high

transportation costs. This accounts for 49-57.2 percent of the price increase, depending on the

17

region. While rail transport of Uzbek AN accounts for 25.6 percent of additional costs to

fertilizer, additional long-distance transportation by road incurs an additional cost ranging from

8-44 percent, which causes an increase in retail prices.

For example, AN fertilizer in Batken Oblast is more than doubled because it requires at least 730

km of road transportation to be sold. Some dealers supply fertilizer to Laylak, a town in Batken

Oblast, and also sell to dealers and farmers from Tajikistan. There are high re-export duties,

about $286/mt, but it is very difficult to prohibit illegal re-export due to the poorly controlled

Kyrgyz-Tajik border. Resale to Tajik dealers and farmers is apparently why some dealers

transport fertilizer to Batken Oblast despite its high costs. Transportation and delivery costs to

southern oblasts accrue about an additional $70/mt. As for Batken Oblast in the south, near to

Tajikistan, the delivery costs including unloading and uploading are about $100/mt.

TheRoleoftheGovernmentinFertilizerSupply

The Kyrgyz Government negotiated an agreement with the Government of Uzbekistan to supply

200,000 mt of ammonium nitrate and urea to the country. A total of 18,000 mt of ammonium

nitrate and urea for the retail price of $295.11 and $351.50/mt, respectively, was supplied

directly to farmers by mid-February 2014. Under this arrangement, fertilizers are distributed

without private contractors through the State Fund of Material Reserves at a prime cost. There

are several selling points in the southern oblasts with the support of local governments. There are

plans to expand this network to the northern oblasts of Chuy and Issyk-Kul.

The argument for fertilizer supply at cheap prices is that farmers with limited financial resources

are unwilling to make large financial investments and/or take risks to buy fertilizer at high

current market prices. Fertilizer supply at cheaper prices, by a minimum of 35 percent,

encourages many farmers to buy inputs, reduce soil erosion and increase yield opportunities.

However, there is also the possibility that this will discourage private sector businesses that have

already purchased and stored fertilizer during winter and would not be able to sell for expected

prices.

The Association of Agribusinessmen of Kyrgyzstan (AAK), supported by the KAED/IFDC

project, has had an important private sector influence on agricultural policy. The association

18

helped remove the 20-percent value-added tax on fertilizer imports in 2004, which resulted in a

slight increase in nitrogen and phosphate fertilizer use compared to the previous year.

Figure 9. Supply Chain of Fertilizer in Kyrgyz Republic

Fertilizer Points (RF, UzR, KzR)

AN (RF ) $210/mtAN (UzR) $255/mt

APh (KzR) $310/mt

Fertilizer Dealers

Farmers

Southern Fertilizer Dealers

FarmersFarmersFarmers

Farmers

Road TransportationNorthern Oblasts: $20/mt-$55/mt

Southern Oblasts: $69/mt-$112/mt

Railroad Transportation

$38/mt-$88/mt

19

Figure 10. Flow of Fertilizer From Uzbekistan, Kazakhstan and Russia, and Further Distribution Map

UZ: Navoiazot (AN)

UZ: FerganaAzot (AN)

KZ: KazAzot (AN)

KZ: Kazphosphate (Ammophos, Superphosphate)

RF: All Types of fertilizer

20

SupplyofFertilizerFromRussianFederation

There are a large number of plants producing nitrogen and phosphate fertilizers in Russia.

These fertilizer plants are located in Kemerovo, Kyrovsk, Solykamsk, Velkyi Novgorod,

Perm, Tver, Tolyatti, Voskresensk, Meleuz (Bashkortostan) and other cities. Since the

demand increases early each year in Russia, a few Kyrgyz dealers contact Russian fertilizer

plants in October and November. Long-term agreements with a fertilizer plant are not

practical because of the possibility of price changes in subsequent years. Searching for lower

factory gate prices and rail transportation costs are the main tasks for importers in October

and November each year. Fertilizers from Russia are imported during the winter months and

stored until the growing season. Factory prices in producing countries such as Russia and

Kazakhstan are cheaper in the winter than during the seeding and growing seasons when non-

resident importers must compete with local Russian or Kazakh demand for supplies.

Although fertilizer in Russia is cheaper than in Kazakhstan, importers shoulder high rail costs

of at least $87.88/mt (17.3 percent of the supply chain cost component).

Figure 11. Supply Chain Cost Components of Ammonium Nitrate from Russian Federation in 2013 ($/mt)

$210(34.4%)

$210(38.3%)

$210(37.6%)

$210(38.3%)

$210(39.8%)

$210(41.4%)

$87.88(14.4%)

$87.88(16.0%)

$87.88(15.7%)

$87.88(16.0%)

$87.88(16.7%)

$87.88(17.3%)

$112.47(18.4%)

$61.84(11.3%)

$69.22(12.4%)

$54.60(10.0%)

$38.49(7.3%)

$20.49(4.0%)

$199.89(32.8%)

$188.52(34.4%)

$191.55(34.3%)

$195.84(35.7%)

$191.26(36.2%)

$188.58(37.2%)

$0 $100 $200 $300 $400 $500 $600

Batken

Jalalabad

Osh

Naryn

Issyk-Kul

Chuy

Producer Price Railroad Transportation

Road Transportation Storage, Distribution, Marketing

21

ImportofFertilizerFromtheRepublicofUzbekistan

There are several large fertilizer plants in Uzbekistan that produce nitrogen, phosphate and

compound fertilizers: FerganaAzot, Navoiazot, Chirchik Fertilizer Plant, Samarkand

Superphosphate Factory, Maxam-Chirchik, Ammofos-Maxam and Kukon Superphosphate

JSC. Until 2010, Oshkrastex LLC was an exclusive importer of fertilizer from FerganaAzot,

which is situated about 35 km from Kyzyl-Kiya, Batken Oblast, in southern Kyrgyz

Republic. However, civil instability in 2010 compelled Uzbek authorities to close its Kyrgyz

border and disrupted fertilizer supply.

A significant but limited share of imported ammonium nitrate came from Uzbekistan through

Kazakhstan. The fertilizer plant Navoiazot in Uzbekistan uses a Commodity Exchange to sell

fertilizer at the end of each year for coming seasons. Dealers use this opportunity and request

fertilizer for early spring via Commodity Exchange.

It should be noted that the import parity price of Russian AN supplied from Uzbekistan is

lower by about 9 percent compared to Uzbek AN, while the retail price is higher by about

4 percent. This is due to a storage of Russian fertilizer during winter, which leads to higher

costs.

In the middle of 2013, Agromet LLC began legally importing fertilizer from FerganaAzot.

22

Figure 12. Supply Chain Cost Components of Ammonium Nitrate from Uzbekistan (Navoiazot) in 2013 ($/mt)

ImportofFertilizerFromRepublicofKazakhstan

The neighboring country Kazakhstan has rich natural resources and a thriving mining

industry, led by developments in its oil and gas sectors. KazAzot is the sole producer of

ammonia and ammonium nitrate in the country. In addition, the country is significantly

developing phosphate deposits and producing fertilizers under the management of a private

company, Kazphosphate. In Kazakhstan, the KazAzot plants situated in Aktau and Taraz are

manufacturing phosphate and compound fertilizers. Only a few companies obtain nitrogen

and phosphate fertilizer directly from the Kazphosphate and KazAzot plants. Small Kyrgyz

agro-dealers receive inputs through the hub of Lugovaya.

$255(44.0%)

$255(48.3%)

$255(47.4%)

$255(48.3%)

$255(50.3%)

$255(52.4%)

$72.16((12.5%)

$72.16(13.7%)

$72.16(13.4%)

$72.16(13.7%)

$72.16(14.2%)

$72.16(14.8%)(

$112.47(19.4%)

$61.84(11.7%)

$69.22(12.9%)

$54.60(10.3%)

$38.49(7.6%)

$20.49(4.2%)

$139.72(24.1%)

$138.62(26.3%)

$141.50(26.3%)

$145.87(27.6%)

$141.28(27.9%)

$138.59(28.5%)

$0 $100 $200 $300 $400 $500

Batken

Jalalabad

Osh

Naryn

Issyk-Kul

Chuy



23

Figure 13. Supply Chain Cost Components of Ammonium Nitrate from Kazakhstan (Kazphosphatet) in 2013 ($/mt)

5.FertilizerConsumptionbyOblasts

Farmers in the south, including the Osh, Jalalabad and Batken oblasts, use more fertilizer

(48.2 percent of the requirement) than their northern counterparts (10.8 percent of the

requirement). This is due to the fact that the Association of Agribusinessmen of Kyrgyzstan –

“Jer-Azygy” – was initially established in the south in 2002 with the help of IFDC’s KAED

project and IFDC technical support, directed toward southern dealers and farmers. Farmers in

the south also had access to lower-cost Uzbek fertilizers. Until 2010, fertilizers were mostly

imported from Uzbekistan to Osh Oblast. These normally accounted for over 95 percent of

the country’s supply and were mainly composed of ammonium nitrate. This encouraged

farmers to use cheaper fertilizer.

$310(49.1%)

$310(54.5%)

$310(53.5%)

$310(54.5%)

$310(58.5%)

$310(58.8%)

$38.34(6/1%)

$38.34(6.7%)

$38.34(6.6%)

$38.34(6.7%)

$38.34(7.0%)

$38.34(7.3%)

$112.47(17.8%)

$61.84(10.9%)

$69.22(11.9%)

$54.60(9.6%)

$38.49(7.0%)

$20.49(3.9%)

$170.27(27.0%)

$158.82(27.9%)

$161.79(27.9%)

$166.06(29.2%)

$161.48(29.5%)

$158.79(30.1%)

$0 $100 $200 $300 $400 $500 $600

Batken

Jalalabad

Osh

Naryn

Issyk-Kul

Chuy



24

Source: DCPP Figure 14. Fertilizer Requirement and Use in Physical Weight by Oblasts in 2011 (mt)

According to the National Statistical Committee of Kyrgyz Republic (NSC), fertilizer

consumption from 2007-2011 ranged from 20.9 kg to 25.5 kg (Table 9). However, fertilizer

was used for only about one-third of the portion of cultivated land. Fertilizer is often used for

commercial crops, cotton and potato, while in 2011, use with food crops averaged about

17.5 kg of fertilizer nutrient.

7,90039.3%

27,390(47.9%)

25,296(52.2%)

60,586(48.2%)

4,438(18.2%)

14,453(14.1%)

4,000(6.4%)

277(1.1%)

23,168(10.8%)

12,200

29,81023,204

65,214

19,962

88,147

58,700

25,023

191,832

0

50,000

100,000

150,000

200,000

250,000m

t Fertilzerrequrement

Fertilizerapplied

25

Table 9. Mineral Fertilizer Consumption per Cultivated Land in 2007-2011 (kg/ha)

Products/Years 2007 2008 2009 2010 2011 Fertilizer consumption (sum of N, P2O5 and K2O equivalent) per ha

25.5 20.9 22.9 24.8 20.8

Including: Nitrogen fertilizer 23.2 19.4 21.0 22.0 N/A Phosphate (P2O5 equivalent) 2.3 1.5 2.0 2.8 N/A Potash (K2O equivalent) 0.0 0.001 0.001 0.000 N/A Fertilizer (sum of N, P2O5 and K2O equivalent) applied for selected crops: Cereals (excluding maize) 26.6 20.7 27.6 29.7 22.7 Sugar beet 21.7 N/A 13.2 26.7 16.5 Cotton 134 101.9 103.4 102.2 103.1 Tobacco 56.5 19.7 88.5 32.7 73.1 Potato 38.5 32.1 28.5 25.5 24.4 Vegetables 18.6 31.2 25.1 30 24.1 Agriculture land portion where fertilizer applied (%)

27.4% 23.9% 35.9% 33.7% 33.1%

Source: FAOSTAT, The National Statistical Committee, 2012 FertilizerUseinWheatProduction

As the KAED surveys shows, only 49.9 percent of farmers covering 63.8 percent of the land

area use mineral and/or organic fertilizers in wheat production. Inorganic nitrogen fertilizers

are used 77.3 percent more often by southern farmers than northern farmers. The lower usage

of nutrients in the northern part of the country can be explained by a large area (50.4 ha/farm)

allocated for wheat, especially in Chuy Oblast, which accounts for about 44 percent of the

country’s total wheat land area. However, this type of farming is also one of the major causes

of soil depletion and low yields in the country.

26

Table 10. Fertilizer Use by Farmers for Wheat Production in Kyrgyz Republic in 2011-2013

Average Land Area (ha)

Yield (kg/ha)

Seed Rate(kg)

Fertilizer Use Any Type of

Fertilizer Inorganic Nitrgen

Fertilizer Inorganic Phosphate

Fertilizer

% of Farmers

% of Land Area

% of Farmers

% of Land Area

% of Farmers

% of Land Area

Chuy 50.4 2,972 255 57.4% 66.3% 52.5% 58.7% 4.9% 8.1% Issyk-Kul 2.4 2,373 290 30.2% 37.4% 15.9% 21.4% 13.7% 16.6% Talas 2.1 3,126 274 52.3% 70.9% 16.8% 38.9% 49.5% 69.6% Naryn 1.65 2,147 260 11.2% 18.2% 0.0% 0.0% 6.9% 14.2% Northern Oblasts

11.9 2,921 270 33.7% 62.6% 18.5% 53.2% 16.2% 10.9%

Osh 1.64 2,028 239 86.6% 81.5% 79.2% 75.7% 4.7% 2.8% Jalalabat 0.89 3,227 253 76.8% 74.6% 69.6% 70.7% 1.4% 1.0% Batken 1.90 2,512 263 80.5% 89.3% 80.5% 89.3% 11.7% 14.9% Southern Oblasts

1.53 2,862 252 82.7% 83.1% 77.3% 79.4% 5.8% 6.5%

Total KR 8.5 2,890 263 49.9% 63.8% 37.9% 54.8% 12.8% 10.6% Source: KAED/IFDC Survey As the KAED surveys implies, given the yields in 2012, removed nutrients are not fully

replaced with nutrients from fertilizer. Less than 20 percent of removed potash is applied to

land using manure (Table 11).

27

Table 11. Nutrient Removal and Application by Oblasts in Wheat Production in 2012 (kg/ha)

Oblasts Yielda (kg/ha)

N (kg/ha) P2O5 (kg/ha) K2O (kg/ha) Removalb Appliedc +/- Removalb Appliedc +/- Removalb Appliedc +/-

Chuy 1,609 43.8 22.6 -21.2

(-48.4%)16.4 15.1

-1.3 (-7.9%)

55.5 12.4 -43.1

(-77.7%)

Issyk-Kul 1,350 36.7 12.5 -24.2

(-65.9%)13.8 8.8

-5 (-36.2%)

46.6 8.2 -38.4

(-82.4%)

Talas 1,968 53.5 13.5 -40

(-74.8%)20.1 21.4

+1.3 (+6.5%)

67.9 0.0 -67.9

(-100%)

Naryn 1,714 46.6 7.7 -38.9

(-83.5%)17.5 13.3

-4.2 (-24.0%)

59.1 6.1 -53

(-89.7%)Northern Oblasts

1,557 42.4 38.3 -21.1

(-49.8%)15.9 14.9

-1 (-6.3%)

53.7 11.5 -42.2

(-78.6%)

Osh 2,079 56.5 57.9 +1.4

(+2.5%)21.2 3.7

-17.5 (-82.5%)

71.7 3.1 -68.6

(-95.7%)

Jalalabad 1,990 54.1 75.4 +21.3

(+39.4%)20.3 5.1

-15.2 (-74.9%)

68.7 6.9 -61.8

(-90.0%)

Batken 1,755 47.7 109.5 +61.8

(+129.6%)17.9 4.4

-13.5 (-75.4%)

60.5 2.1 -58.4

(-96.5%)Southern Oblasts

1,993 54.2 77.0 +22.8

(+42.1%)20.3 4.1

-16.2 (-79.8%)

68.8 3.3 -65.5

(-95.2%)

Total KR 1,670 45.4 40.6 -4.8

(-15.6%)17.0 14.2

-2.8 (-16.5%)

57.6 11.0 -46.6

(-80.9%)Source: a. NSCKR. a. 2013, Handbook of Agriculture. b. ICAR, KAED/IFDC Survey.

FertilizerUseinMaizeProduction

Maize has been the most profitable crop among cereals in the Kyrgyz Republic due to its

relatively high output prices and export possibilities. Also, new maize hybrids, especially

Pioneer Company seeds, are becoming popular through KAED/IFDC support to farmers. It is

apparent that, compared to wheat production, more farmers (61.4 percent) apply inorganic

fertilizer for maize. However, no type of fertilizer use in maize production was observed in

Talas Oblast, where only about 5 percent of the total land area is devoted to maize.

28

Table 12. Fertilizer Use by Farmers for Maize Production in Kyrgyz Republic in 2011-2013


Yield (kg/ha)

Seed Rate(kg)

Fertilizer Use Organic and/or

Inorganic Inorganic Nitrogen

Fertilizer Inorganic

Phosphate Fertilizer

% of Farmers

% of Land Area

% of Farmers

% of Land Area

% of Farmers

% of Land Area

Chuy 6.7 7,168 22 58.5% 79.7% 46.6% 75.4% 5.1% 51.5%Talas 0.3 2,134 20 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Northern Oblasts

3.0 6,873 21 24.3% 75.0% 19.4% 71.0% 2.1% 48.5%

Osh 0.58 6,526 29 94.7% 94.7% 83.7% 91.2% 3.3% 2.3%Jalalabat 0.71 4,680 22 87.3% 90.3% 82.9% 88.4% 0.6% 0.8%Batken 0.60 7,196 32 100.0% 100.0% 92.7% 94.7% 11.0% 22.1%Southern Oblasts

0.63 6,449 28 92.9% 93.7% 84.9% 90.6% 3.5% 4.7%

Total KR 1.5 6,603 25 68.3% 80.1% 61.4% 76.4% 3.0% 36.5%Source: KAED/IFDC Survey Deficiency in all types of nutrient use is apparent (Table 13). Even though prices for

phosphate fertilizers are higher in the south, due to smaller land area resources, southern

farmers use available areas more intensively than northern farmers do.

Table 13. Nutrient Removal and Application by Oblasts in Maize Production in 2012 (kg/ha)



Chuy 6,277 179.5 79.5 -100

(-55.7%)64.0 45.8

-18.2 (-28.4%)

180.1 13.5 -166.6

(-92.5%)

Talas 6,210 177.6 0.0 -177.6

(-100%) 63.3 0.0

-63.3 (-100%)

178.2 0.0 -178.2

(-100%)

Naryn 4,993 142.8 0.0 -142.8

(-100%) 50.9 0.0

-50.9 (-100%)

143.3 0.0 -143.3

(-100%) Northern Oblasts

6,262 179.1 74.8 -104.3

(-58.2%)63.9 43.1

-20.8 (-32.6%)

179.7 12.7 -167

(-92.9%)

Osh 6,516 186.4 138.8 47.6

(-25.5%)66.5 18.6

-47.9 (-72.0%)

187.0 26.1 -160.9

(-86.0%)

Jalalabad 5,672 162.2 163.8 +1.6

(+1.0%)57.9 2.9

-55 (-95.0%)

162.8 3.2 -159.6

(-98.0%)

Batken 5,865 167.7 147.1 -20.6

(-12.3%)59.8 25.6

-34.2 (-57.2%)

168.3 17.5 -150.8

(-89.6%)Southern Oblasts

6,023 172.3 150.1 -22.2

(-12.9%)61.4 13.4

-48 (-78.2%)

172.9 15.6 -157.3

(-91.0%)

Total KR 6,097 174.4 95.5 -78.9

(-45.2%)62.2 35.0

-27.2 (-43.7%)

175.0 13.5 -161.5

(-92.3%)Source: a. NSCKR. a. 2013, Handbook of Agriculture. b. ICAR, KAED/IFDC Survey.

29

FertilizerUseinPotatoProduction

Potato production incurs higher costs than cereals and is also labor intensive with a high

degree of dependence on labor during planting and harvesting seasons. Therefore, small

farms with less than 1 ha account for most of the potato-growing area in the country. More

than 82 percent of potato farmers use organic and/or inorganic fertilizers. A small share of

these farms (32 percent) use inorganic fertilizer, preferring organic fertilizers when they are

available at little or no cost.

Table 14. Fertilizer Use by Farmers for Potato Production in Kyrgyz Republic in 2011-2013


Yield (kg/ha)

Seed Rate(kg)

Fertilizer Use Organic and/or

Inorganic Inorganic Nitrogen

Fertilizer Inorganic

Phosphate Fertilizer

% of Farmers

% of Land Area

% of Farmers

% of Land Area

% of Farmers

% of Land Area

Chuy 0.9 10,776 2,944 68.8% 75.9% 25.0% 51.7% 37.5% 55.2%Issyk-Kul 1.3 31,169 3,003 83.6% 91.1% 25.2% 30.9% 33.3% 47.7%Talas 0.5 18,140 2,987 65.5% 78.5% 1.7% 3.5% 0.0% 0.0%Naryn 0.72 17,834 2,865 83.7% 88.9% 5.1% 17.3% 2.3% 5.5%Northern Oblasts

0.9 23,890 2,950 79.0% 88.0% 11.2% 22.8% 12.6% 26.2%

Osh 0.24 13,446 2,818 90.5% 92.8% 62.6% 72.2% 12.6% 11.8%Jalalabat 0.31 11,506 2,765 75.0% 80.3% 52.3% 64.2% 1.1% 0.6%Batken 0.31 15,026 2,891 98.3% 95.6% 82.8% 91.0% 27.6% 44.7%Southern Oblasts

0.27 20,730 2,824 87.8% 89.7% 63.4% 73.6% 12.2% 14.9%

Total all country

0.6 22,037 2,890 82.5% 88.3% 32.0% 31.6% 12.4% 24.2%

Source: KAED/IFDC Survey.

30

Table 15. Nutrient Removal and Application by Oblasts in Potato Production in 2012 (mt)



Chuy 16,868 74.2 47.8 -26.4

(-35.6%) 33.7 45.3 +11.6

(+34.4%) 131.6 33.4 -98.2

(-74.6%)

Issyk-Kul 16,818 74.0 87.9 +13.9

(+18.8%) 33.6 82.7 +49.1

(+146.1%) 131.2 55.9 -75.3

(-57.4%)

Talas 17,195 75.7 125.8 +50.1

(+66.2%) 34.4 92.9 +58.5

(+170.1%) 134.1 136.3 +2.2

(+1.6%)

Naryn 14,018 61.7 132.6 +70.9

(+114.9%) 28.0 97.1 +69.1

(+246.8%) 109.3 139.3 +30

(+27.4%)Northern Oblasts

16,648 73.3 107.8 +34.5 (+47.1%) 33.3 88.0 +54.7

(+164.3%) 129.9 96.3 -33.6 (-25.9%)

Osh 15,232 67.0 175.1 +108.1

(+161.3%) 30.5 74.0 +43.5

(+142.6%) 118.8 80.8 -38

(-32.0%)

Jalalabat 13,976 61.5 135.0 +73.5

(+119.5%) 28.0 11.3 -16.7

(-59.6%) 109.0 15.9 -93.1

(-85.4%)

Batken 13,755 60.5 248.0 +187.5

(+309.9%) 27.5 150.2 +122.7

(+446.2%) 107.3 111.6 +4.3

(+4.0%)Southern Oblasts

14,604 64.3 177.6 +113.3 (+176.2%) 29.2 70.5 +41.3

(+141.4%) 113.9 67.7 -46.2 (-40.6%)

Total KR 16,103 70.9 119.9 +49 (+69.1%) 32.2 85.0 +52.8

(+164.0%) 125.6 91.3 -34.3 (-27.3%)

FertilizerConsumptionbySecondaryNutrients

Table 16. Fertilizer Consumption by Micronutrients

Wheat Maize Potato Ca Mg Ca Mg Ca Mg

Chuy 24.7 6.0 22.3 5.4 58.0 14.0 Issyk-Kul 28.7 6.9 0.0 0.0 81.0 19.5 Talas 0.0 0.0 0.0 0.0 228.8 55.2 Naryn 44.0 10.6 0.0 0.0 206.60 49.90 Northern Oblasts 24.4 5.9 22.3 5.4 143.6 34.7 Osh 5.1 1.2 36.3 8.8 114.80 27.70 Jalalabat 12.3 3.0 4.7 1.1 26.10 6.30 Batken 3.1 0.8 23.1 5.6 154.00 37.20 Southern Oblasts 6.8 1.6 21.4 5.2 98.30 23.70 Total KR 22.7 5.5 22.2 5.4 136.4 32.9 Source: KAED/IFDC Survey

6.FertilizerUsebyFarmSizeClassification

Three types of farms managed by agricultural producers or farmers and defined by their sizes

are evaluated in this study: households and smallholders, average-scale farms, and large-scale

farms.

31

The types of farms that are typical of each scale follow this scale:

Households and smallholders manage up to 2 ha of land.

Average-scale farms manage 2 ha to 10 ha of land.

Large-scale farms manage more than 10 ha of land.

FertilizerUsebyFarmSizeforWheatProduction

As Table 17 presents, more than 70 percent of wheat-producing farmers were households and

smallholders. The portion of farms that use organic and/or inorganic fertilizer ranges from

45.4 percent (small-scale farmers) to 63.5 percent (large-scale farmers). Consequently, large-

scale farmers received 17 percent higher yields than small-scale farmers (2,999 kg/ha

compared to 2,555 kg/ha).

Average-scale farmers achieved almost the same yields as small-scale farmers using less

fertilizer. This can be explained by their relatively more efficient use of fertilizers, improved

seed quality, access to modern machinery and cultivation management. Factors that reduce

yields of small-scale farmers include inappropriate timing of application, seed rates and

cultural farming practices. Also, lack of access to modern machinery should be noted here,

since the majority of small-scale farmers are dependent on this type of machinery service.

Harvest losses due to old machinery and delayed harvests are estimated to range from 15-

25 percent above normal losses (Guadagni, M., and Fileccia, T. 2012).

Table 17. Fertilizer Use in Wheat Production by Farm Classification, 2011-2013

Farm Classification

Share of Land Area

(%)

Seed Rate

(kg/ha)

Fertilizer Use

% of Farms Applying

Any Type of Fertilizer

% of Farms Using

Organic Fertilizer

% of Farms Using

Inorganic Nitrogen Fertilizer

% of Farms Using

Inorganic Phosphate Fertilizer

% of Farms Using

Inorganic N&P

Fertilizer Household and smallholders

71.3% 266 45.4% 11.5% 34.9% 9.7% 4.1%

Average-scale farms 22.9% 261 60.5% 5.4% 42.9% 22.9% 10.2% Large-scale farms 5.8% 243 63.5% 5.8% 55.8% 9.6% 1.9% Source: KAED/IFDC Survey

32

Table 18. Nutrient Use in Wheat Production by Farm Classification in 2011-2013 (kg/ha)

Farm Classification Fertilizer Use Yield

(kg/ha) N P2O5 K2O Ca Mg Households and Smallholders

36.7 11.6 8.9 11.7 2.8 2,555

Average-Scale Farms 27.6 7.9 2.8 3.6 0.9 2,557 Large-Scale Farms 43.4 15.7 12.7 16.7 4.0 2,990 FertilizerUsebyFarmClassificationforMaizeProduction

About 90 percent of maize producers in the country have land area of 2 ha or less (Table 19).

These farmers, on average, apply more nutrients compared to large-scale farmers. However,

large-scale farmers receive higher yields (51 percent higher) from their relatively high-level

use of phosphate fertilizer (54.5 percent of farmers), and use of mainly hybrid seeds, as well

as other agricultural practices such as proper application of fertilizer and crop rotation.

Table 19. Fertilizer Use in Maize Production by Farm Classification, 2011-2013

Farm Classification

Share of Land Area

(%)

Seed Rate

(kg/ha)

Fertilizer Use

% of Farms Applying


% of Farms Using

Organic Fertilizer

% of Farms Using


% of Farms Using


% of Farms Using

Inorganic N&P


90.5% 25 67.5% 24.5% 61.0% 2.5% 2.5%

Average-scale farms 8.1% 23 75.0% 28.1% 62.5% 0.0% 0.0% Large-scale farms 1.4% 19 81.8% 0.0% 81.8% 54.5% 54.5%Source: KAED/IFDC Survey

Table 20. Nutrient Use in Maize Production by Farm Classification in 2011-2013 (kg/ha)


(kg/ha) N P2O5 K2O Ca Mg Households and smallholders 116.8 14.9 18.4 24.3 5.9 5,207

Average-Scale Farms 70.0 20.0 29.4 38.7 9.3 6,330 Large-Scale Farms 94.1 59.8 0.0 0.0 0.0 7,865

Source: KAED/IFDC Survey

FertilizerUsebyFarmClassificationforPotatoProduction

Small-scale farmers lack the land, capital and labor to cultivate potatoes using best practices,

but the large number of small-scale farmers produce a large total volume using small amounts

33

of fertilizer, water and labor. However, because most small farmers use low-quality seed,

either saved seed or cheap C7-C10 generation seed from informal markets, their yields per

hectare are low and not responsive to balanced and adequate fertilizer application. Even

though the proportion of area for large-scale farmers is less than 1 percent, they reap double

yields compared to small-scale farmers.

Table 21. Fertilizer Use in Potato Production by Farm Classification, 2011-2013

Farm Classification

Share of Land Area

(%)

Seed Rate

(kg/ha)

Fertilizer Use

% of Farms Applying


% of Farms Using

Organic Fertilizer

% of Farms Using


% of Farms Using


% of Farms Using

Inorganic N&P


97.2% 2,895 82.2% 64.9% 31.1% 11.7% 5.4%

Average-scale farms 2.4% 2,715 90.0% 50.0% 70.0% 35.0% 35.0% Large-scale farms 0.5% 2,875 100.0% 75.0% 25.0% 50.0% 0.0% Source: KAED/IFDC Survey

Table 22. Nutrient Use in Potato Production by Farm Classification in 2011-2013 (kg/ha)


(kg/ha) N P2O5 K2O Ca Mg Households and smallholders 132.3 86.6 105.4 138.9 33.5 18,437

Average-Scale Farms 83.1 67.1 34.3 45.2 10.9 22,078 Large-Scale Farms 66.3 98.8 55.0 72.5 17.5 38,764 Source: KAED/IFDC Survey

7.Value‐CostRatioofFertilizerUseonCropYields

Fertilizer application in Kyrgyzstan results in low yields because of inefficient and

imbalanced use. Traditionally, local farmers only use nitrogen fertilizers, mainly ammonium

nitrate. Some are unaware of the potential benefits of phosphate and potash fertilizers for

crops and believe that using any type is enough, reflecting the misconception that one type of

fertilizer can be substituted for another. Moreover, it is believed that phosphate and potash

fertilizers are unnecessary since local soils are rich in these nutrients, especially potash. Even

though some farmers understand fertilizer nutrient roles, this awareness does not necessarily

lead to efficient usage because other factors, such as financial constraints, may limit their

34

access to required fertilizer. Additional limiting factors include low yields caused by

deficiencies in other nutrients, low fertilizer use efficiency and low profits for farmers, even

for those who apply large amounts of nitrogen. Therefore, increasing farmers’ knowledge of

the importance of balanced fertilization and quality seed for increasing crop yields must be a

priority.

Another issue that must be explored is fertilizer use in terms of value-cost ratio (VCR) for

selected crops. Value-cost ratio is calculated as VCR = (ΔY*P)/C where ΔY is the

incremental yield gain resulting from fertilizer use, P is the price of output per kg and C is the

cost of added fertilizer. A minimum VCR of 2 implies profitability from fertilizer use. A

greater VCR ratio means higher profit from incremental costs.

VCRs estimates are based on trial plots where winter wheat, maize, potato varieties and

hybrids were tested in 2007-2009 in order to investigate the benefits of seed varieties, hybrids

and balanced fertilizer application compared to traditional use of inputs data. It should be

noted that during these analyses, input and output fertilizer prices were adjusted to 2013

levels because of the higher output prices in 2012 as a result of drought. VCRs vary from

year to year based on input and output prices.

Wheat. On-farm trials of wheat varieties were organized in 2008 by IFDC’s KAED project

in two farms in Sokuluk Rayon, Chuy Oblast, and Aksuy Rayon, Issyk-Kul Oblast. In 56

plots of 0.2 ha each, 13 winter wheat varieties were grown and tested with two levels of

fertilizer application using certified seeds and one undefined variety of non-certified (poor-

quality seeds) seeds that farmers traditionally purchase from a bazaar because of the low

price. These varieties included the following:

Zhamin, Almira, Starshina, Petr, Suleiman, Intensivnaya, Araket, Kasiet,

Krasnodar, Eritrosppermum 760, Nota, Moskvich, Tanya and undefined non-

certified (improper seeds)

The rates of fertilizer application were determined by soil tests and were the same for all

demonstrations:

Traditional practice of 350 kg AN/ha (34 percent N)

Improved practice:

o 264 kg AN/ha (34 percent N).

o 300 kg Ammophos (11 percent N, 46 percent P2O5).

35

o 150 kg Potassium Chloride (K2O).

The objective of these trials was to see yield and value-cost ratio for four types of

possibilities in farming activities:

1. Undefined seed quality under traditional fertilizer treatment using only nitrogen fertilizer.

2. Undefined seed quality under improved fertilizer practice (NPK).

3. Good quality varieties under traditional fertilizer treatment.

4. Good quality varieties under improved fertilizer practice (NPK).

The yields of the 13 recommended varieties ranged from 2,600 kg/ha to 4,800 kg/ha under

the traditional practice of nitrogen application; under balanced fertilization, these varieties

ranged from 3,660 kg/ha to 6,230 kg/ha. The average results shown in Table 23 reveal that

balanced fertilizer application benefited certified varieties, resulting in a yield increase from

3.932 mt/ha to 5.514 mt/ha. Taking into account the additional cost for fertilizer

($381.32/ha), the resulting profit was $162.94. For undefined varieties and seed qualities,

balanced NPK reduced profitability due to a low increase in yield of only 670 kg/ha,

compared to 1,582 kg/ha using KAED-recommended varieties. Indeed, as the data in Table

25 shows, 1 kg of additional NPK resulted in a yield increase of 6.8 kg for quality varieties;

only the undefined variety was less responsive to fertilizer, showing a yield increase of only

2.8 kg. In terms of value-cost ratios, each dollar spent on balanced nutrients gives the output

of $1.84 for quality varieties and $0.77 for undefined seed quality. These are lower than the

acceptable VCR of 2.

Comparing quality varieties under recommended fertilizer practice with undefined seeds

under traditional practice, response to NPK and quality seeds is about 10.1 kg grain per 1 kg

of NPK, or a 2.76 VCR. All this analysis implies that at various levels of seed and fertilizer

treatments, the potential yield increase is about 77.3 percent. Improved practice of fertilizer

use with traditional undefined varieties accounts for only a 21.3-percent increase. It should be

noted that the potential increase of 26.4 percent from using proper varieties is not cumulative

but independent from best improved fertilizer application practices. Yields are more

responsive to seed characteristics than fertilizer if compared independently. However, much

more benefit can be achieved with a combination of quality seed and balanced fertilizer

application.

36

Maize. In 2009, KAED used an undefined variety of maize and the following five maize

hybrids for trials:

Tulpar – 539, Marko – 419, Arman – 689, Altay – 329 and Skif – 619


demonstrations:

Traditional practice of 300 kg AN/ha (34 percent N).

Improved practice:


o 500 kg Diammaphoska (11 percent N, 26 percent P2O5, K2O 26 percent).

These trials helped to estimate four types of operations related to seed and fertilizer

applications. The results in Table 23 and Table 25 show results similar to wheat trials: the

undefined variety does not have a large response to the use of NPK and gives only 2.6 kg of

yield per kg of NPK nutrients. A significant increase is observed when both hybrid seeds and

NPK fertilizer application are used, compared to traditional practices of undefined seeds and

only nitrogen fertilizer use, resulting in a 14.9-kg increase per kg of NPK, or in value-cost

ratio terms, 4.99. Maize yields can be increased by 71.1 percent over traditional practice if

best operations in seed and fertilizer aspects are used.

Potato. KAED/IFDC supported two farms in Sokuluk Rayon, Chuy Oblast, and Aksuy

Rayon, Issyk-Kul Oblast, in variety trials of potato in 2007 where one local variety and the

following nine varieties were tested:

Agave, Delicate, Molly, Karlena, Fazan, Fontane, Rokko, Marlen and Impala


demonstrations:

Traditional practice of 350 kg AN/ha (34 percent N).

Improved practice:


o 500 kg Diammaphoska (11 percent N, 26 percent P2O5, K2O 26 percent).

The yields of recommended potato varieties, excluding undefined seeds, ranged from

19.5 mt/ha to 38.5 mt/ha. Under the traditional practice of nitrogen application and

37

unbalanced fertilization, these varieties produced yields from 15.8 mt/ha to 33.2 mt/ha. Out

of nine varieties, only four (Agave, Karlena, Rokko and Impala) resulted in high yields of

31 mt/ha or higher. The results of these four varieties were used for the analysis. The

resulting VCRs are higher compared to cereals, and the return is $4.99 per dollar spent for

NPK nutrient. Yield of potato can be increased by up to 78 percent using best practices.

38

Table 23. Response and Benefits for Recommended Levels of Balanced Fertilizer Application

Crop

Output Price

Fields A Fields B

Yield Increase

Cost of Additional

Fertilizer Use Benefits Fertilizer Used Yields Fertilizer Used Yields ($/mt) (kg) (U.S. $) (kg) (U.S. $) (kg) (U.S. $) (kg) (U.S. $) (kg) (U.S. $) (U.S. $) (U.S. $)

Wheat $228 N120 $166.56 3,932 $896 N124P138K90 $364.62 5,514 $1,257 1,582 $361 $198.06 $162.94 Wheat (improper seeds) $228 N120 $166.56 3,110 $709 N124P138K90 $364.62 3,780 $862 670 $153 $198.06 -$45.06 Maize $217 N103 $142.77 7,998 $1,736 N153P130K130 $453.13 11,123 $2,414 3,125 $678 $310.36 $367.64 Maize (improper seeds) $217 N103 $142.77 6,500 $1,411 N153P130K130 $453.13 7,300 $1,584 800 $173 $310.36 -$137.36 Potato $166 N120 $166.56 24,225 $4,021 N136P130K130 $429.34 32,138 $5,335 7,913 $1,314 $262.78 $1,051.22 Potato (improper seeds) $166 N120 $166.56 18,050 $2,996 N136P130K130 $429.34 21,000 $3,486 2,950 $490 $262.78 $227.22

Table 24. Response and Benefits for Recommended Quality Seeds and Levels of Balanced Fertilizer Application

Crop

Output Price

Fields A Fields B

Yield Increase

Cost of Additional

Fertilizer Use Benefits Fertilizer Used Yields Fertilizer Used Yields ($/mt) (kg) (U.S. $) (kg) (U.S. $) (kg) (U.S. $) ($/mt) (kg) (kg) (U.S. $) (U.S. $) (U.S. $)

Wheat $228 N120 $166.56 3,110 $709 N124P138K90 364.62 5,514 1,257 2,404 1,257 1,257 1,257 Maize $217 N103 $142.77 6,500 $1,411 N153P95K95 453.13 11,123 2,414 4,623 2,414 2,414 2,414 Potato $166 N120 $167 $18,050 $2,996 N136P130K130 429.34 32,138 5,335 14,088 5,335 5,335 5,335

39

Table 25. Response and Value-Cost Ratios for Recommended Levels of Balanced Fertilizer Application

Crop

Fields A Fields B Yield Increase per kg of NPK

(kg)

Cost of Added

Fertilizers (U.S. $/kg nutrient) VCR

Fertilizer Used (kg)

Yield (kg)


Yield (kg) (kg) (U.S. $)

Wheat N120 3,932 N124P138K90 5,514 6.8 $1.55 $0.85 1.82 Wheat (improper seeds) N120 3,110 N124P138K90 3,780 2.9 $0.66 $0.85 0.77 Maize N103 7,998 N153 P130K130 11,123 10.1 $2.19 $1.00 2.19Maize (improper seeds) N103 6,500 N153 P130K130 7,300 2.6 $0.56 $1.00 0.56 Potato N120 24,225 N136P130K130 32,138 28.7 $4.75 $0.95 4.99 Potato (improper seeds) N120 18,050 N136P130K130 21,000 10.7 $1.77 $0.95 1.86

Table 26. Response and Value-Cost Ratios for Recommended Quality Seeds and Levels of Balanced Fertilizer Application

Crop

Fields A Fields B Yield Increase per kg of NPK

(kg)

Cost of Added

Fertilizers (U.S. $/kg nutrient) VCR


Yield (kg)


Yield (kg) (kg) (U.S. $)

Wheat N120 3,110 N124P138K90 5,514 10.4 $2.36 $0.85 2.76 Maize N103 6,500 N153 P130K130 11,123 14.9 $3.39 $1.00 3.39 Potato N120 18,050 N136P130K130 32,138 45.4 $10.34 $0.95 10.86

LookingBack:VCRThenandNow

Table 27. VCR Comparisons for Recommended Quality Seeds and Levels of Balanced Fertilizer Application in 2002 and 2013

Crop

Fertilizer Added (kg)

Yield Increase per kg of NPK (kg) Cost of Added Fertilizers

(U.S. $/kg nutrient) Value-Cost Ratio kg

U.S. $ 2002 2013 2002 2013 2002 2013

Wheat N4P138K90 10.4 $1.03 $2.36 $0.22 $0.85 4.75 2.76 Maize N53 P130K130 14.9 $1.49 $3.39 $0.21 $1.00 7.08 3.99 Potato N16P130K130 45.4 $4.53 $10.34 $0.19 $0.95 23.36 10.86

The fall in VCR values is a result of a rise in output prices of around 130 percent compared to fertilizer

price increases of 300-400 percent.

40

Figure 15. VCR for Recommended Levels of Balanced Fertilizer Application in 2002 and 2013

8.YieldGapLevelsandLimitingFactorsinFoodSecurity

There are two ways of interpreting yield gaps. One interpretation defines optimum yield in an

environment where all factors are non-limiting. However, farmers cannot achieve these optimum

yields considering the existing environment, cost-benefit factors, marginal return to additional inputs

and other efforts, access to proper machinery, and other socio-economic factors.

It is almost impossible to separate the effects of fertilizer and seeds in improving crop yields. In order

to produce high yields, crops require a continuous effort to eliminate constraints such as improper

variety, deficiency in nutrients, agricultural climate, improper fertilizer placement, diseases, pests,

water and other factors. As the survey results show, there is a large gap between economically

achievable yields and average yields obtained in the country. While the trials showed the impact of

only two factors, improved varieties and additional fertilizer, the survey showed the real farm-level

gaps in the country as it was divided into the following levels:

1.34

3.13

1.09

4.37 4.18

11.14

0.77

1.82

0.56

2.19

1.86

4.99

-2.00

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Wheat(improper

seeds)

Wheat Maize(improper

seeds)

Maize Potato(improper

seeds)

Potato

2002 2013

41

Yield Gap Level I

This gap exists mainly due to socio-economic factors such as knowledge, the small scale of

farming, access to modern machinery, small land plots and labor shortage. Farmers in this level

achieve yields at minimum costs, do not use any type of fertilizer and do not follow basic soil

management and crop cultivation techniques. Some of these farmers face financial constraints

in running best management practices, and others have alternate sources of income that

overcome low incomes from farming.

Yield Gap Level II

Farmers in this level have access to required machinery and tools for farming. However, these

farmers follow traditional cultural practices using suboptimal inputs and growing the same crop

every year. They use only limited amounts of manure as fertilizer and use local varieties or

their own multiplied seeds. These farmers are unaware of best cultivation practices, basic

agricultural soil management and the negative factors of monoculture cropping systems. Many

consider the types of farming under Gap Levels I and II as a result of land distribution among

all people living in rural areas, regardless of experience in farming.

Yield Gap Level III

The majority of commercial farmers in the country have gained some knowledge in farming

management over the last 20 years, but they do not use, or are not able to use, recommended

varieties and fertilizer nutrients for the cultivation of crops due to financial constraints. They

use traditional, local varieties or non-certified seeds and only use nitrogen fertilizer and

manure. Farmers in this level have limited access to agricultural inputs, such as high-yielding

varieties of seed and complex fertilizer.

Yield Gap Level IV

Farmers in this level use seeds of high quality and of different varieties but are still unaware of

or reluctant to apply required nutrients to the soil to achieve high yields. They apply limited

quantities of livestock manure and only use inorganic nitrogen fertilizer for the cultivation of

crops. These farmers have limited access to agricultural inputs, such as high-yielding varieties

of seed and complex fertilizer. Also, benefit-cost factors influence this gap, considering given

regions and output prices.

Best-Practice Farmers

A small proportion of farmers achieve high optimum yields using recommended high-yielding

varieties and balanced fertilizer nutrients. These are relatively large-scale farmers who are

involved in growing cereals and some small-scale farmers growing potato.

42

Attainable Yields

These are yields that can be obtained under trial conditions in Kyrgyzstan with the available

improved varieties that have been tested by the State Commission for the Evaluation of Plant

Variety Registration (SCEPVR) and KAED/IFDC in several regions in the country.

It should be noted that the share of farmers using complete fertilizer along with undefined seeds, or

those that do not follow soil management practices, is insignificant and therefore not assigned to any

level.

YieldGapLevelsinWheatProduction

As the results of trials by KAED showed,

the improved fertilizer and variety practices

on trial fields resulted in wheat yields of

5.5 mt/ha in trials, compared to the national

average yield of 2.4 mt/ha.; maize yields of

11.1 mt/ha, compared to a national average

of 5.9 mt/ha in country level; and a potato

yield of 32.1 mt/ha, compared to 16 mt/ha

nationally. As shown in Figure 16,

inefficient use of fertilizers and the use of

inappropriate varieties and seed reduce

wheat yield by 43.6 percent. A variety of

factors contribute to Yield Gap II in spite

of farmers’ efforts to achieve higher output using best nutrient management. Also, use of best varieties

without proper nutrient management results in a 28.7-percent gap from potential achievable yields.

While these trials illustrate only the potential capacities of the given varieties using required inputs and

benefits from added nutrients, Table 28 represents the actual existing yield gap levels in the country.

About 5.9 percent of farmers, from Gap Level I, are mainly households and small farmers with an

average area of 1 ha. They produce wheat as the single crop at minimum costs, do not use any type of

fertilizer or quality seeds, and have limited access to agricultural machinery services. Their wheat

yields on average are 1.7 mt/ha, that is, 73 percent lower than the attainable yield in the country. About

1.5 percent of agricultural land is used for wheat production by this type of farmer.

Yield Gap 1 (43.6%)

P2O5 and K2O deficiencies

Improper variety/ poor seed quality

Yield Gap 2 (31.4%)

Optimal NPK nutrients


Yield Gap 3 (28.7%)

Proper variety/ quality seed


Yield potential given proper varieties and

efficient nutrients

Figure 16. Wheat Yield Gap at Fertilizer and Seed Levels on KAED/IFDC Trials in 2008

43

Table 28. Yield Gap Levels in Wheat Production on Farm Scales

GAP Level

I

GAP Level

II

GAP Level

III

GAP Level

IV

Best- Practice Farmers

Attainable Yield

Yield, kg/ha 1,676 2,227 3,071 4,414 5,720 6,214 Yield gap as percent of achievable

(73.0%) (64.2%) (50.6%) (29.0%) (7.9%)

% of farmers 5.9% 7.3% 41.4% 35.2% 6.0% Average size of land, ha

0.98 1.10 3.1 24.7 12.4

% of land, ha 1.5% 1.7% 33.4% 52.7% 7.1% Source: KAED/IFDC Survey.

Farmers who use suboptimal inputs and mainly manure as fertilizer but still grow poor-quality,

unimproved wheat varieties and fail to use crop rotations account for 7.3 percent of farmers and

achieve yields 64.2 percent less than attainable. These are also households and small farmers with an

average land area of 1.1 ha. Approximately 55 percent of farmers use non-certified seeds, and the

majority of them fall under Yield Gap Level III. They follow relatively good agricultural soil

management practices, especially using crop rotation as a way to reduce some production expenses

and to manage sustainable farming. However, these farmers have scarce financial resources for using

required inputs and risk averse attitudes to receiving higher net incomes from additional expenditures

by improving agro-inputs.

About 35.2 percent of farmers with an average land area of 24.7 ha, covering more than half of the

total wheat area and located mainly in northern oblasts, use quality seeds to produce wheat but do not

follow nutrient requirements, thus missing an additional 29-percent increase in yields. The majority of

these farmers are risk-averse due to droughts in 2010 and 2012 when optimal inputs did not give

expected yields and many wheat-growing farmers, especially advanced ones, had to face losses. Rather

than intensify production, they prefer to use extensive low-input management for wheat production.

Best-practice farms in wheat production account for about 7.1 percent of wheat land area and achieve

average yields of 5,720 mt/ha, which is only 7.9 percent less than attainable yields in trials.

44

Figure 17. Yield Gap Levels in Wheat Production by Category

Gap III

3,071 kg/ha (50.6%)

Imbalanced fertilizer application

Improper variety and seeds

Gap II

2,227 kg/ha (64.2%)

Poor cultivation practices



Limited access to machinery

Yield of “Best

Practice” Farmers

5,720 kg/ha (7.9%)

Gap IV

4,414 kg/ha (29.0%)


Attainable Yield

6,179 kg/ha

Gap I

1,676 kg/ha (73.0%)

Poor cultivation and land use practices

No organic/inorganic fertilizer application



45

YieldGapLevelsinMaizeProduction

As with wheat production, inefficient use of

fertilizer and inappropriate varieties and

seed reduce maize yield by 41.6 percent in

trials supported by KAED/IFDC. Using

best nutrient management for undefined

non-certified or non-hybrid maize accounts

for 34.4 percent of yield gaps. As for only

nutrient deficiencies, yield gaps of

28.1 percent resulted in trials.

Table 29 represents country-level yield

gaps in maize production. About 16 percent

of farmers, mainly households and

smallholders with an average area of less

than 0.7 ha, account for 10.5 percent of

maize land area and are in Gap Levels I and

II. About 66.1 percent of farmers using undefined non-hybrid maize seeds with limited fertilizer,

mainly organic and/or nitrogen fertilizer, achieve yields that are 47.7 percent lower than attainable.

These gaps exist due to lack of knowledge and scarce financial resources to buy required inputs.

Table 29. Yield Gap Levels in Maize Production on Farm Scales

GAP Level

I

GAP Level

II

GAP Level

III

GAP Level

IV


Attainable Yield


(69.8%) (59.5%) (47.7%) (40.2%) (16.8%)

% of farmers 2.4% 13.7% 66.1% 9.8% 1.9% Average size of land, ha

0.63 0.66 1.0 2.1 62.0

% of land, ha 1.5% 9.0% 34.6% 36.2% 12.2% Source: KAED/IFDC Survey.

Hybrid maize seeds are available from Pioneer Company, maize seed-producing companies from

Kazakhstan and China, and local Ala-too hybrids. The costs of hybrid seeds are considerably higher

than local non-certified varieties. Therefore, the majority of farmers are unaware of or choose not to

make the investment in hybrid seed. Farmers using hybrid seed but applying insufficient or unbalanced

Yield Gap 1 (41.6%)



Yield Gap 2 (34.4%)



Yield Gap 3 (28.1%)




efficient nutrients

Figure 18. Maize Yield Gap at Fertilizer and Seed Levels on KAED/IFDC Trials in 2008

46

fertilizer have a 40.2-percent yield gap from attainable yield because hybrid maize is responsive to

balanced fertilizer use. A little less than 2 percent of farmers with larger maize cultivation areas

(62 ha) use all required inputs to obtain optimal yields and, on average, achieve 9,254 mt/ha.

47

Figure 19. Yield Gap Levels in Maize Production by Category

Gap III

5,819 kg/ha (47.7%)



Gap II

4,500 kg/ha (59.5%)

Poor cultivation practices




Yield of “Best Practice”

Farmers

9,254 kg/ha (16.8%)

Gap IV

6,657 kg/ha (40.2%)


Attainable Yield

11,123 kg/ha

Gap I

3,356 kg/ha (69.8%)





48

KAED trials resulted in a 43.8-percent

yield gap when inappropriate variety

seeds and only nitrogen fertilizer were

used in potato production (Figure 20).

Using best nutrient management for non-

certified undefined seeds accounts for a

34.7-percent yield gap. As for only

nutrient deficiencies, a 24.6-percent yield

gap resulted.

Table 30 represents yield gaps by

category. The majority of potato growers

are households and smallholders, and only

1.3 percent of them use complete nutrients with the

proper seeds.

More than 90 percent of potato farmers use non-certified or older generation potato seeds (C4 and

older) due to existing supply and demand effects. Good quality potato seeds cost more than $1,500/ha,

about 10 times higher than those for wheat and maize seed costs per hectare. The majority of

smallholders and households plant their own seed or buy cheap seed because they are either unaware

of the potential of quality seeds or because of they cannot afford them. These factors create limitations

on quality seed use which leads to low yields nationally. Two seed farms, a potato-seed-producing

cooperative in the south and the cooperative “Zarya” in the north, annually import no more than

100 mt of elite potato seeds for further multiplication. Even assuming all elite seeds are multiplied to

the C4 generation with standard seed multiplication ratio of 1:4, the required seeds cover only about

8,500 ha, less than 11 percent of the total potato area in the country. Certainly, many seed-producing

farmers sell C2 generation for farmers to produce outputs for consumption markets.

Yield Gap 1

(43.8%)



Yield Gap 2 (34.7%)



Yield Gap 3 (24.6%)




efficient nutrients

Figure 20. Yield Gap Levels in Potato Production

49

Table 30. Yield Gap Levels in Potato Production by Category

GAP Level

I

GAP Level

II

GAP Level

III

GAP Level

IV


Attainable Yield


(74.8%) (64.4%) (55.7%) (45.4%) (12.3%)

% of farmers 10.9% 9.6% 65.1% 7.4% 1.3% Average size of land, ha 0.34 0.85 0.5 0.4 1.1 % of land, ha 7.8% 17.3% 65.3% 5.2% 2.9% Source: KAED/IFDC Survey.

Farmers growing Sante variety obtained high yield results (34 mt/ha) compared to other varieties. The

second variety was the German variety Jelly. It showed high yield results of 23.8 mt/ha. As for other

varieties, yields ranged from 14.6 mt/ha to 22.6 mt/ha. Sante had higher yields because high quality

tubers of this variety are imported annually. Small yields from other varieties are related to their

generational age, since some of them are older than C8-C10.

As it is apparent from the table above that about 1.3 percent of farmers, covering 2.9 percent of total

potato area, use the full potential of seed inputs and nutrients together.

50

Figure 20. Yield Gap Levels in Potato Production on Farm Scales

Gap III

18,608 kg/ha (55.7%)



Gap II

14,948 kg/ha (64.4%)

Poor cultivation practices Imbalanced fertilizer

application Improper variety and

seeds Limited access to

machinery

Yield of “Best Practice”

Farmers

29,504 kg/ha (12.3%)

Gap IV

22,930 kg/ha (45.4%)


Attainable Yield

41,970 kg/ha

Gap I

10,569 kg/ha (74.8%)





51

SummaryofResultsandRecommendations

The following general conclusions regarding the fertilizer use situation can be drawn from this study:

Only one-third of the required fertilizer is supplied and used in the country. Nitrogen fertilizer is

popular among farmers even though its use has not been more 43.5 percent of the required use.

Less than one-tenth of the required phosphate fertilizer is applied by farmers. Inorganic fertilizer

with potash nutrients is rarely used (up to 0.02 percent of required since 2004).

High transportation costs are the biggest constraint on fertilizer use, making the majority of crops

less competitive when compared to crops from neighboring Uzbekistan and Kazakhstan, where

fertilizers are produced.

Fertilizers from Russia and Kazakhstan are imported during winter when prices are lower and

stored until the growing season. During seeding and growing seasons, fertilizer prices are low only

for Russian and Kazakh residents and farmers but are expensive or unavailable for non-residents.

Only three laboratories exist in the country but do not track soil analysis of nutrients on the country

level – only for selected farms. Land fragmentation may complicate this type of activity since soil

management of smallholders differs greatly from one to the next. Farms and farming households in

the country total more than 1 million, which far exceeds the existing capacities of these

laboratories.

The analysis shows that farmers have little formal agricultural experience. The majority of them

shifted to agriculture after the country gained independence. Some farmers are highly educated in

different fields of study but are new to the field of agriculture. They have only a basic knowledge

of when and how to apply agro-inputs, and many farmers are unaware of the need for a balanced

fertilizer program. Farmers prefer nitrogen fertilizer due to its quick response and visual effects.

The effects of phosphate and potash fertilizers are usually not visual, despite the significant impact

on yields (strengthening of the root system, disease resistance, hardiness, increased flowering,

etc.). In addition, applied phosphate and potash fertilizers have a long-term impact on production

that provides benefits for future seasons.

The yields of wheat, maize and potato are negatively correlated to farm size. Economies of scale

and resources available allow larger farms to achieve higher yields with the use of improved

technology and mechanized farming. Very small farms established from the land fragmentation

following independence lack the resources and the knowledge to implement best management

practices, and the efficiency of large farms cannot be directly transferred to these very small farms.

For example, traveling to distant small fields, using expensive machinery services, inability to

rotate crops and purchasing small quantities of inputs for small plots all reduce productivity.

52

A portion of smallholders do not use the technology of crop rotation on small plots. Food security

of the family dictates the cultivation of the same crop every year.

Complete fertilizer use for wheat does not show sufficient benefits due to low output prices that are

not competitive with Kazakh and Russian subsidized rates. However, farmers continue to produce

wheat for food security reasons. Also, growing alternative crops requires more inputs and labor-

intensive activity, access to agricultural machinery and financial investment. An increase in land

area gives more benefits in wheat production than intensive fertilizer use with complete nutrient

applications. Large farms implement soil management practices, such as crop rotations with

perennial grasses to manage existing yields and provide stabilization for the following years.

Maize is the most profitable crop among cereals. Farmers can obtain benefits from using balanced

fertilizer, especially with modern hybrid varieties that are becoming more popular. The potential

exists with use of hybrids and balanced fertilization to increase maize production by about

50 percent at the national level.

The majority of potato producers are households and smallholders. The majority of farmers use

organic fertilizer (manure) due to cheap costs or no expense. One-third of farmers apply nitrogen,

and only about 12 percent of farmers apply phosphate fertilizer. Potatoes are the most expensive

crop to grow; if proper quality potato seeds are used, the cost of potato seed can often exceed the

total cost of wheat production. A large quantity of labor is employed in potato production, and

primarily manual labor (rather than machinery) is used in potato harvesting. Regardless of these

expenses, this crop has more opportunities for an increase in production. One dollar of additional

complete (balanced) fertilizer gives about $5 of benefit. As the study shows, average potato

production can be significantly increased if farmers adopt advanced farming techniques and

practice balanced fertilizer use.

Recommendations

On the basis of the findings of the study, the following recommendations are made for policy

consideration:

1. Fertilizer Supply. The government has already agreed with Uzbekistan on providing 200,000 mt

of nitrogen fertilizer, which is considered by the DCPP to be the total amount of nitrogen fertilizer

required for the country. However, the government is also distributing these fertilizers to farmers

through its own channels for prices that are 35 percent lower than retail prices dictated by the

market price. This is undermining private-sector fertilizer supply channels. It is recommended that

the role of government should be to negotiate with the supply countries, Uzbekistan, Kazakhstan

and Russia, for bulk import volumes of phosphate and potash fertilizer in addition to nitrogen

53

fertilizer at affordable prices and make these available to the private sector for distribution to

farmers. These steps would increase supply and decrease fertilizer prices.

2. Empower Local Governance and Extension Services. Many Kyrgyz farmers require additional

technical knowledge on best farming practices and the efficient use of fertilizer. Addressing these

requirements requires investment in the provision of extension services to offer practical education

to farmers. Over the years, many interventions have been made by the government and

international donors to develop smallholder agriculture but with limited success. Many countries

have extension services that support farmers. Current independent extension services are not

capable of providing countrywide services due to limitations of given tasks, budgets and human

resources. Also, they are dependent on donor funding to secure constant supply support to all

farmers in all regions every year. Nevertheless, they contain high potential in introducing modern

agricultural methods, input use and new varieties to complement government agricultural

activities.

Local governments could be empowered to initiate and direct the provision of agricultural

services and determine and implement projects to complement the activities of the central

government in their areas. Further decentralization and increasing the capacities of local

governments could increase farmers’ knowledge, skills and capacities to increase food production

and improve food security. Empowering capacities of local governments would have a positive

impact for the following reasons:

The service will be closer to farmers – especially households and smallholders – and more

attentive to their problems.

Decentralized extension reduces the costs of the central government, and the extension

activities fulfill needs according to the agricultural zones and main crops grown in the area.

Constraints and limiting factors are analyzed locally, and further steps to overcome existing

problems are prioritized by local farmers.

Depending on needs and opportunities, local governments should be able to do the following:

Improve access to other agriculture support services, such as finance, inputs, markets, etc.

Endow farmers with skills and knowledge of sustainable farm management.

Facilitate their access to new technologies.

Establish trial fields to estimate benefits of fertilizer, varieties and farm management.

54

3. Land Consolidation into Viable Farms on a Voluntary Basis. Smallholders lag behind medium-

and large-sized farmers in agricultural productivity and have lower crop yields. Land consolidation

is considered worldwide to be a way to improve farm productivity through reduction of inputs and

transportation costs, efficient soil management, easier mechanization and higher productivity. The

government could consider establishing an incentive program to encourage small farmers to initiate

consolidation of their land on a voluntary basis into economically viable larger farms, such as

cooperatives with shared ownership, making them capable of accessing larger markets and

developing linkages with wholesale dealers and buyers. Large farms are able to buy inputs, such as

fertilizer and seeds, for lower prices, use machinery services for lower fees and have better soil

management through crop rotation,

diversification and other activities. Figure 21

represents the impact of the lower wholesale

NPK fertilizer prices compared to retail prices

for the selected crops. Even though wheat is

still inefficient when complete fertilizer is used,

significant increases of VCRs for maize and

potato are apparent.

The activity of land consolidation should also

be initiated by aiyl-okmotus (local

governments), keeping budgetary constraints in

mind. Their main income comes from land tax.

It is considered by some central government

authorities that land tax is significantly low and should be increased in order to motivate farmers in

efficient agricultural land use to increase productivity. Indeed, higher land tax may motivate farmers

and households to intensify the use of modern agricultural inputs to increase land productivity and

optimize the allocation of resources. Thus, the additional tax income sources should be used for

extension services and land consolidation initiatives at local government levels.

Wheat

Maize

Potato

0

1

2

3

4

5

6

7

CurrentImpact

1.82 1.94

2.19 2.62

4.99

6.21

Figure 21. Effect of Complete Fertilizer Wholesale Price to VCR

55

References

AAK. 2013. “Market Research Report of Vegetable Seeds, Fruit Seedlings, Fertilizer in Fruit

&Vegetable Sector Value Chains of Kyrgyz Republic,” Osh, Kyrgyzstan.

Abdullaev, U. 2009. Results of Varieties and Hybrids on Trials Yields, KAED/IFDC, Bishkek, Kyrgyz

Republic.

Baanante, C., and D. Abdulhamidov. 2003. “Comparative Advantage of Agricultural Production in

Kyrgyz Republic,” IFDC Alabama, USA.

Efimov, V.N., I.N. Donskikh and V.P. Tsarenko. 2002. “Fertilizer Systems,” Kolos S, Moscow,

Russian Federation

Guadagni, M., and T. Fileccia. 2012. “Farm Mechanization and Agricultural Productivity, 2009 and

MAWR,” FAO, World Bank, Rome Italy.

Kim, O. 2013. Survey Database on Farmers’ Yield on Selected Crops on 2011-2013, KAED/IFDC,

Bishkek, Kyrgyz Republic

NCS. 2012. Agriculture of Kyrgyz Republic 2007-2011, Bishkek, Kyrgyz Republic

NCS. 2013. Results Excluding Livestock and Poultry in Kyrgyz Republic, Bishkek, Kyrgyz Republic

World Development Indicators 2012, The World Bank, Washington, D.C., USA.

56

AppendixA.FertilizerRequirementsbyOblasts

Table A.1. Fertilizer Nutrient Requirements in Kyrgyz Republic by Oblast in Kyrgyz Republic

Country Batken Jalalabad Issyk-kul Naryn Osh Talas Chuy

All cultivated area excluding perennial grasses

N54P49K30 N43P57K23 N59P56K33 N68P60K37 N59P54K30 N55P50K31 N49P48K31 N48P42K26

Winter wheat N46P37K25 N40P31K21 N51P40K27 N55P44K29 N0P0K0 N47P37K25 N45P36K24 N44P35K25

Spring wheat N58P55K32 N45P43K25 N61P61K35 N70P63K38 N59P54K30 N60P60K36 N52P57K36 N50P46K26

Grains and pulses N56P46K28 N44P35K23 N57P46K29 N79P63K38 N66P54K30 N48P39K25 N50P45K27 N51P42K24

Industrial crops (cotton, tobacco, sugar beet, oil crops)

N63P62K39 N58P60K37 N73P76K45 N13P17K12 N20P22K17 N79P82K49 N44P40K28 N45P37K27

Potato, vegetables and melons N49P58K42 N47P50K34 N47P51K34 N52P61K47 N48P66K52 N50P56K39 N57P67K51 N51P55K38

Forage crops N17P32K14 N14P24K10 N16P30K10 N18P36K14 N20P42K19 N19P31K15 N7P15K7 N18P31K16

Fruits and berries N21P20K10 N10P10K5 N26P26K13 N27P26K13 N0P0K0 N39P38K19 N39P39K20 N7P7K4

Grapes N16P16K9 N18P18K10 N12P11K6 N0P0K0 N0P0K0 N52P51K27 N0P0K0 N6P6K3

All for the region N47P45K26 N35P32K19 N55P53K52 N57P54K32 N44P49K27 N51P48K30 N39P40K25 N41P39K23

Source: DCPP

57

AppendixB.LivestockManureProductionRatesandNutrientContent

Table B.1. Nutrient Availability on Manure

Nitrogen

(N) Phosphorus

(P2O5) Potassium

(K2O) Calcium

(Ca) Magnesium

(Mg) Organic Matter

Fresh manure % % % % % % Cattle 0.5 0.3 0.5 0.3 0.1 16.7 Sheep 0.9 0.5 0.8 0.2 0.3 30.7 Poultry 0.9 0.5 0.8 0.4 2 30.7 Horse 0.5 0.3 0.6 0.3 0.12 7 Swine 0.6 0.5 0.4 0.2 0.03 15.5

Treated dried manure % % % % % % Cattle 2 1.5 2.2 2.9 0.7 69.9 Sheep 1.9 1.4 2.9 3.3 0.8 53.9 Poultry 4.5 2.7 1.4 2.9 0.6 58.6

Source: EcoChem (http://www.ecochem.com/t_manure_fert.html)

Table B.2. Approximate Annual Dried Manure Production and Fertilizer Content with Loss Adjustments

Animal mt/Year* Nitrogen

(N) Phosphorus

(P2O5) Potassium

(K2O) Calcium

(Ca) Magnesium

(Mg) Organic Matter

Cattle 4.5 2.0% 1.5% 2.2% 2.9% 0.7% 69.9%

Sheep 0.45 1.9% 1.4% 2.9% 3.3% 0.8% 53.9%

Poultry 0.025 4.5% 2.7% 1.4% 2.9% 0.6% 58.6%

Source: *Efimov and others (2002) “Fertilizer Systems”

Table B.3. Approximate Quantity, Composition and Value of Dried Cattle Manure

Total

Annual Production

(mt) Nitrogen

(N) Phosphorus

(P2O5) Potassium

(K2O) Calcium

(Ca) Magnesium

(Mg) OrganicMatter

Kyrgyz Republic 1,367,466 6,153,597 123,072 92,304 135,379 178,454 43,075 4,301,364

Chuy Oblast 251,824 1,133,208 22,664 16,998 24,931 32,863 7,932 792,112

Bishkek city 1,065 4,793 96 72 105 139 34 3,350

Issyk-Kul Oblast 191,974 863,883 17,278 12,958 19,005 25,053 6,047 603,854

Naryn Oblast 136,552 614,484 12,290 9,217 13,519 17,820 4,301 429,524

Talas Oblast 66,291 298,310 5,966 4,475 6,563 8,651 2,088 208,518Subtotal Northen Oblasts

647,706 2,914,677 58,294 43,720 64,123 84,526 20,403 2,037,359

Osh Oblast 314,647 1,415,912 28,318 21,239 31,150 41,061 9,911 989,722

Osh city 9,123 41,054 821 616 903 1,191 287 28,696

Jalal-Abad Oblast 273,136 1,229,112 24,582 18,437 27,040 35,644 8,604 859,149

Batken Oblast 122,164 549,738 10,995 8,246 12,094 15,942 3,848 384,267

Subtotal Southern 719,070 3,235,815 64,716 48,537 71,188 93,839 22,651 2,261,835

58

Oblasts

Table B.4. Approximate Quantity, Composition and Value of Dried Sheep and Goat Manure

Total

Annual Production

(mt) Nitrogen

(N) Phosphorus

(P2O5) Potassium

(K2O) Calcium

(Ca) Magnesium

(Mg) OrganicMatter

Kyrgyz Republic 5,423,881 2,440,746 46,374 34,170 70,782 80,545 19,526 1,315,562

Chuy Oblast 574,882 258,697 4,915 3,622 7,502 8,537 2,070 139,438

Bishkek city 3,773 1,698 32 24 49 56 14 915

Issyk-Kul Oblast 796,451 358,403 6,810 5,018 10,394 11,827 2,867 193,179

Naryn Oblast 940,291 423,131 8,039 5,924 12,271 13,963 3,385 228,068

Talas Oblast 498,606 224,373 4,263 3,141 6,507 7,404 1,795 120,937


2,814,003 1,266,301 24,060 17,728 36,723 41,788 10,130 682,536

Osh Oblast 1,002,482 451,117 8,571 6,316 13,082 14,887 3,609 243,152

Osh city 16,413 7,386 140 103 214 244 59 3,981

Jalal-Abad Oblast 1,121,282 504,577 9,587 7,064 14,633 16,651 4,037 271,967

Batken Oblast 468,714 210,921 4,008 2,953 6,117 6,960 1,687 113,687

Subtotal Southern Oblasts

2,608,891 1,174,001 22,306 16,436 34,046 38,742 9,392 632,787

Table B.5. Approximate Quantity, Composition and Value of Dried Poultry Manure

Total

Annual Production

(mt) Nitrogen

(N) Phosphorus

(P2O5) Potassium

(K2O) Calcium

(Ca) Magnesium

(Mg) OrganicMatter

Kyrgyz Republic 5,076,559 126,914 5,711 3,427 1,777 3,681 761 74,372

Chuy Oblast 1,843,111 46,078 2,07 3 1,244 645 1,336 276 27,002

Bishkek city 23,400 585 26 16 8 17 4 343

Issyk-Kul Oblast 797,127 19,928 897 538 279 578 120 11,678

Naryn Oblast 177,917 4,448 200 120 62 129 27 2,606

Talas Oblast 245,402 6,135 276 166 86 178 37 3,595


3,086,957 3,086,957 138,913 83,348 43,217 89,522 18,522 1,808,957

Osh Oblast 799,115 19,978 899 539 280 579 120 11,707

Osh city 30,503 763 34 21 11 22 5 447

Jalal-Abad Oblast 897,396 22,435 1,010 606 314 651 135 13,147

Batken Oblast 262,509 6,563 295 177 92 190 39 3,846Subtotal Southern Oblasts

1,989,523 1,989,523 89,529 53,717 27,853 57,696 11,937 1,165,860

59

AppendixC.FarmMachineryDeficitsinKyrgyzRepublic

Table C. 1. Machinery Deficit in Kyrgyz Republic, 2012

Oblasts

Sown Area All Crops

('000 ha) Grains Area

Tractor Need for Average Sown Area

(based on tech. para.)

Operational Tractors

Average Tractor Deficit

Grain Combine Harvester Need

for Average Grains Sown

Area (estimated) Operational Combines

Average Combine Deficit

('000 ha) % ('000 ha) % Quantity % Quantity (%)

Chuy oblast 403.4 35% 251.7 40% 10,086 5,475 4,611 46% 1,259 614 645 51%

Issyk-kul oblast 179.4 15% 96.5 15% 4,485 2,792 1,693 38% 483 498

Talas oblast 102.7 9% 62.8 10% 2,568 1,268 1,300 51% 314 92 222 71%

Naryn oblast 102.3 9% 27.8 4% 2,559 1,402 1,157 45% 139 240

Northern oblasts 787.9 68% 438.9 70% 19,697 10,937 8,760 44% 2,194 1,444 750 34%

Osh oblast 173.1 15% 88.6 14% 4,327 2,995 1,332 31% 443 160 283 64%

Jalalabad oblast 143.6 12% 58.1 9% 3,590 2,361 1,229 34% 291 102 189 65%

Batken oblast 61.2 5% 39.6 6% 1,529 1,040 489 32% 198 38 160 81%

Southern oblasts 377.8 32% 186.3 30% 9,446 6,396 3,050 32% 932 300 632 68%

Kyrgyz Republic

1,165.7 100% 625.2 100% 29,143 17,333 11,810 41% 3,126 1,744 1,382 44%

Source: WB, Farm mechanization and agricultural productivity, 2009 and MAWR, 2012. Updated by the author.

60

Source: WB, Farm mechanization and agricultural productivity, 2009

Figure C.1. Aging Farm Machinery in Kyrgyz Republic, 2003

Source: WB, World Development Indicators 2012

Figure C.2. Agricultural Machinery (tractors per 100 km2 of arable land, 2009)

91%86%

9%14%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Wheel tractors Combines

Older than 1990

Newr than 1990

310.2

291.6

216.9

197.6

188.1

0 50 100 150 200 250 300 350

Tajikistan

Armenia

Georgia

Moldova

KyrgyzRepublic

61

Table C.2. International Comparison of Private Investments in Agriculture in 2012

Machine Deficit (No.) Average Price

(U.S. $) Total Financial

Requirement (U.S. $) Tractors 11,810 20,000 236,196,500 Combine harvesters 1,382 100,000 138,191,000 Seeders 1,255 12,000 15,058,920 Total 389,446,420 Source: WB, Farm mechanization and agricultural productivity, 2009 & updated by author.

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