Institute for War and Peace Reporting | Giving Voice, Driving Change

Kazak Flour Smuggling Targeted

Authorities move to stop dwindling grain supplies being sold on the Uzbek black market.
By Olga Dosybieva

High demand for grain exports has boosted a thriving smuggling racket and led to a serious shortage of flour in Kazakstan.

The authorities have now moved to clamp down on the lucrative trade in flour by bringing in new regulations to catch the cheats.

The shortages happened after local grain producers, over which the central authorities have very little control, took advantage of the high demand for Kazak flour by increasing their exports - leaving far fewer amounts for sale to the domestic market.

Those living in the populous south promptly started to stockpile when prices shot up by 15 per cent - a crippling rise for the majority of families in the poverty-stricken region.

"Bread and other products made from flour are the staple food of most families here, so this is serious," said Zhanna Zubareva, deputy director of the Shymkent flour milling plant.

Mother-of-two Said Sanjarova told IWPR, "The increase in flour price will hit ordinary families very hard. We bake our own bread, and our everyday food is based on dishes like home-made noodles and baursak [traditional doughnut-like] bread."

"I know many families where bread and tea are the only food they get for breakfast, lunch and dinner."

She added that the price rises mean that nearly a third of her 45 US dollars monthly salary will now have to be spent on flour.

Officials say that bad weather damaged the harvest in neighbouring Russia and Ukraine, causing an increase in demand for Kazak exports. Agriculture ministry official Mukhtar Kurenbaev told IWPR that a ten-fold fall in the domestic grain supply was first noticed back in September.

"Grain producers prefer to sell their produce to foreign buyers, who pay up to 100 dollars a tonne as opposed to the 75 dollars offered south Kazakstan merchants," said Kurenbaev.

The problem was exacerbated by the fact that several of the larger milling plants had to be closed down for repairs in September, further depleting the reserves.

In an attempt to stop the shortages from becoming even more serious, and prices from skyrocketing any further, the authorities have been forced to take action against criminals who traditionally smuggle Kazak grain across the border into Uzbekistan, where its higher quality attracts very good prices.

One Tashkent resident, who wished to remain anonymous, told IWPR that he makes a profit of three and a half dollars on every sack of Kazak flour he resells in Uzbekistan.

"Kazak flour is more popular with people in Uzbekistan, as our flour has a lower content of gluten and does not make a good lepyoshka [traditional flat bread]," he said, adding that many traders cut the domestic flour with the Kazak variety to improve its quality.

In response to the increase in smuggling, trucks carrying flour are allowed to cross into Uzbekistan at only a single checkpoint as of November 13.

The authorities have also set up a working group, including representatives of law enforcement bodies, to stem the illegal export.

Ulukbek Janabaev, head of customs in south Kazakstan, welcomed the news, admitting to IWPR that his service was not able to wipe out the trade on its own. "It is a great help that border guards, police, prosecutor office, security and other law enforcement agencies will be involved in this," he said.

But one border guard, who spoke to IWPR on condition or anonymity, alleged that the smuggling operation involved a number of very high-ranking Uzbek officials using their positions to get the goods through customs, casting doubt on the eventual success of any crackdown.

Residents in the town of Dostuk, on the Uzbek-Kazak border, believed to be a smuggling hotspot, also have their doubts.

"I don't believe that they can install order on the border. It seems there are too many players who benefit from the current situation," said one resident, who gave his name as Baturkhan, reflecting a widespread view.

Olga Dosybieva is correspondent for Interfax-Kazakstan agency in South Kazakstan.