Regular spring rainfall has improved harvest prospects

• Despite high prices for wheat and wheat flour and continued high demand for imported foods, income sources in Tajikistan were seasonally normal or increasing slightly. Remittances in March 2013 were at a record high for March at 221.8 million U.S. dollars, supported in part by a higher level of outmigration in 2013.
• With regular spring rains from late February into April expected to continue and with the slight increase in planted area, prospects for the 2013 wheat harvest in Tajikistan are good. The harvest is likely to be average to above average.
• Prices of wheat and wheat flour are likely to fall following the wheat harvest in Tajikistan and also following the replenishment of Kazakhstan’s wheat stocks when the harvest starts in northern Kazakhstan in August. This should significantly increase regional wheat supply.

Despite moderate rains and snow in early February, drier than usual conditions persist

• Record high January remittances of 178.8 million USD and higher than usual stocks of wheat and potatoes have households better prepared than usual for the ongoing January to March lean season.
• In late January and early February, moderate rains and snow fell, but, following the slow start of the wet season, most river basins have received below average precipitation since October. Early wet season rains support land preparation and sowing for winter crops such as winter wheat and barley to be harvested from May to July 2013. Area planted under winter crops may have been reduced.
• Continuing poor wet season performance and low skill, but longer range forecasts suggest rainfall may be suppressed during the March to June spring wet season. While most indications are for normal performance, below average spring rainfall totals or poor distribution could reduce agricultural productivity, especially of rainfed land, and associated income-earning activities. This might increase food insecurity, especially in southern Tajikistan.

A poor start of the rainy season may prevent winter crop planting

• Record high September remittances of 308.4 million USD in October, high meat prices indicating high livestock prices, and steady casual labor wages are supporting food consumption and winter food stocking in Tajikistan.
• High wheat and wheat flour prices and lower than usual terms of trade between unskilled labor and imported wheat flour may be limiting the ability of some households to prepare for winter and the lean season.
• The wet season has had a slow start with most river basins receiving below average rains from October 1 to November 20. Early wet season rains support land preparation and sowing for winter crops such as winter wheat and barley to be harvested from May to July 2013.

By September, most rural households in Tajikistan have completed the winter wheat harvest which usually starts in late May and ends in September in the higher elevations. The much smaller spring wheat harvest also starts in some locations. However, colder than usual temperatures may have delayed the winter wheat harvest in some areas, especially at higher elevations. While many areas may have been delayed, by the end of August, according to the Ministry of Economic Development and Trade, Tajikistan had already harvested over 863,000 metric tons (MT) of cereals, a higher amount than in the same period last year. However, while local wheat has come into the market, retail prices of both wheat and wheat flour increased significantly from July to August in all reference markets. The increases are primarily related to upward pressure from export prices in Kazakhstan. (September 2012)

Kazakhstan has large stocks of wheat from last year’s bumper harvest, and according to the U.S. Department of Agriculture (USDA) estimates, exports are only expected to fall eight percent below the five-year average. However, Kazakhstan’s ongoing harvest could be up to a third less than the five-year average. This has combined with dry weather-affected wheat crops among the other Black Sea exporters of Ukraine and Russia, both of which, according to USDA estimates, may have wheat production this year from 20 to 30 percent below the five-year average. In Ukraine and Russia, exports may decline to a greater extent than those from Kazakhstan, which has increased demand for Kazakhstan’s exports. While there is likely to be no shortage of exports to provide to Tajikistan, export prices in Kokshetau, Kazakhstan spiked from June to July and again from July to August by 17 and 28 percent, respectively, in Kazakhstani tenge (KZT) terms. This has quickly been transmitted to the markets in Tajikistan. In Dushanbe, retail prices for high quality and for first grade wheat flour increased 19 percent from July to August, in Tajikistani somoni (TJS) terms. Despite being in the post-harvest period, from July to August, the retail price of locally milled wheat flour in Dushanbe rose seven percent and even local wheat grain rose four percent. (September 2012)

Despite the rise of prices in northern Kazakhstan due to losses to dry weather, export wheat prices remain well below their peaks from early 2011. In all reference markets in Tajikistan, in August retail prices for wheat and wheat flour are often below prices from last year though some prices are near their prices from last year. In August 2010, Russia instituted a ban on grain exports after a failed harvest. This was a major factor in international wheat markets that lead to record high prices in Tajikistan by February 2011. A similar decision by Kazakhstan to ban wheat exports in 2008 was a major driver of the food price crisis of 2007 and 2008. However, Kazakhstan continued to export wheat flour during much of 2008 due to the political import of the milling industry. This year, with stronger stocks, and neither country’s Ministry of Agriculture has provided any indications of an impending export ban. Also, it is unclear if either Russia or Kazakhstan could restrict wheat trade with each other under the terms of their custom union, of which Belarus is also a member. With trade flowing in the broader region, Tajikistan has thus far in 2012 imported over 231,000 MT of wheat flour and over 469,000 MT of wheat grain. So while retail wheat and wheat flour prices may rise further, they are unlikely to experience the same spikes caused, at least in part, by the grain export bans during recent years of lower production in Russia or Kazakhstan. (September 2012)

Cumulative seasonal precipitation was substantially above the 2002-2011 average in all river basins within Tajikistan using satellite estimation of rainfall and snowfall. Data from rain gauges provided to the United Nations Development Program (UNDP) by the Tajik Hydrometeorology Center indicates the same trend in participation. Five examined rain gauges reported 2011/2012 season precipitation above the 30-year average and far above last year. However, other than the station in Dushanbe, total precipitation for the 2011/2012 season was below the precipitation level from the 2009/2010 season which was a bumper wheat harvest. Only taking into account the precipitation level would indicate that the prospects for the wheat harvest are above average, but the wheat harvest still may not be as large as the bumper 2010 harvest. (June 2012)

An estimated USD 436.8 million of remittances have come into Tajikistan in August, resulting in another monthly record level and a level above the past ten years, according to unofficial estimates. While remittances seasonally declined as they do every winter, they are now nearing their seasonal peak in September, after which, some labor migrants typically return from Russia. Remittances have remained at monthly record levels since November 2010, which roughly coincides with the period in which food and fuel prices first began their recent ascent. However, consumer inflation this year is far less than last year. (September 2012)

Markets in Khorog and the rest of Gorno-Badakhshan Autonomous Oblast (GBAO) have resumed full operations. Commercial flights between Khorog and Dushanbe have resumed, but it is unclear if the issuing of permits by the national government for non-residents and foreign citizens to enter GBAO has resumed or not. While tensions remain high in the region, trade appears to have resumed, and if roads allow both goods and people to move and communications channels remain open from now until the start of the winter in December, households should be able to carry out normal livelihood activities including buying food stocks for winter. (September 2012)

Rasht Valley Irrigated Potato Livelihood Zone

The Rasht Valley Irrigated Potato livelihood zone has had an especially cold winter and spring. Winter temperatures were below normal across many high elevation areas of eastern Central Asia. This was followed by the persistence of below average temperatures in some areas including large portions of Badakhshan Province in Afghanistan, most of Gorno-Badakhshan Autonomous Oblast (GBAO) in Tajikistan, and the northern portions of the Rasht Valley in the Direct-Rule Districts (DRD) of Tajikistan. The cold winter and cold spring mean that many livestock were not able to return to pasture as early as in a typical year, placing stress on households needing to find or purchase additional fodder, allow their livestock’s body conditions to deteriorate, or make unplanned sales of livestock in poor condition. (June 2012)

Mercy Corps’s April 2012 rapid assessment reports that many people in the Rasht Valley lost, sold, or consumed an unusually high number of seed potatoes this year. As potato-growing is a key source of food and sales of potatoes are a key source of income, along with the later than usual ability to plant due to cold temperatures, livelihoods in this zone have been disrupted. The temperatures have increased in June, and usual agricultural activities are assumed to have commenced. The potato harvest this year will likely be late due to late planting. Some poor households which have lost seed potatoes may not be able to find new seed potatoes from their social networks or markets, but little information is available on seed potato markets or ways households barter for or borrow seed potatoes or if they are commonly received as gifts from better off households. For many years, botanical potato seeds have been difficult to acquire in Tajikistan. Households may substitute other crops for potatoes or reduce area planted in reaction. The performance of other crops, including perennial tree crops such as pears and vegetables that can be stored for winter such as cabbage, will be of increased importance both as sources of food and as sources of income through sales this year. As both livestock production and potato production face unusually late starts of season and potentially reduced periods for growth, households’ ability to find alternative sources of income either from other agricultural production activities or through local or international labor migration, along with a continued access to existing remittance flows, will be key to ensuring poor households have market access to staple foods to replace any anticipated shortfall from their own production. (June 2012)

In Gharm market in the Rasht Valley, potato prices unusually continued to increase between June and July. Seasonally, they would be expected to start their decline at this time. This year, the decline did not start until between July and August. Potato prices in Gharm remain very high, possibly reflecting a smaller potato harvest or higher demand from other regions of the country. (September 2012)

All areas of Tajikistan

From July to August 2012, the price of wheat flour and wheat in regional reference markets across Tajikistan sharply increased. The increase occurred in August, in the post-harvest period, and most indications are for the domestic wheat harvest to be near average this year. However, droughts in Russian and Kazakhstan have led to below-average production, and international wheat prices across many major exporters have increased. These price increases were transmitted to Tajikistan’s wheat and wheat flour prices in August, largely a result of Tajikistan’s dependence on wheat and wheat flour imports from Kazakhstan. (September 2012)

Kazakhstan has large stocks of wheat from last year’s bumper harvest, and according to the U.S. Department of Agriculture (USDA) estimates, exports are only expected to fall eight percent below the five-year average. However, Kazakhstan’s ongoing harvest could be up to a third less than the five-year average. This has combined with dry weather-affected wheat crops among the other Black Sea exporters of Ukraine and Russia, both of which, according to USDA estimates, may have wheat production this year from 20 to 30 percent below the five-year average. In Ukraine and Russia, exports may decline to a greater extent than those from Kazakhstan, which has increased demand for Kazakhstan’s exports. While there is likely to be no shortage of exports to provide to Tajikistan, export prices in Kokshetau, Kazakhstan spiked from June to July and again from July to August by 17 and 28 percent, respectively, in Kazakhstani tenge (KZT) terms. This has quickly been transmitted to the markets in Tajikistan. In Dushanbe, retail prices for high quality and for first grade wheat flour increased 19 percent from July to August, in Tajikistani somoni (TJS) terms. Despite being in the post-harvest period, from July to August, the retail price of locally milled wheat flour in Dushanbe rose seven percent and even local wheat grain rose four percent. (September 2012)

Despite the rise of prices in northern Kazakhstan due to losses to dry weather, export wheat prices remain well below their peaks from early 2011. In all reference markets in Tajikistan, in August retail prices for wheat and wheat flour are often below prices from last year though some prices are near their prices from last year. In August 2010, Russia instituted a ban on grain exports after a failed harvest. This was a major factor in international wheat markets that lead to record high prices in Tajikistan by February 2011. A similar decision by Kazakhstan to ban wheat exports in 2008 was a major driver of the food price crisis of 2007 and 2008. However, Kazakhstan continued to export wheat flour during much of 2008 due to the political import of the milling industry. This year, with stronger stocks, and neither country’s Ministry of Agriculture has provided any indications of an impending export ban. Also, it is unclear if either Russia or Kazakhstan could restrict wheat trade with each other under the terms of their custom union, of which Belarus is also a member. With trade flowing in the broader region, Tajikistan has thus far in 2012 imported over 231,000 MT of wheat flour and over 469,000 MT of wheat grain. So while retail wheat and wheat flour prices may rise further, they are unlikely to experience the same spikes caused, at least in part, by the grain export bans during recent years of lower production in Russia or Kazakhstan. (September 2012)

Like in Afghanistan, wheat products in Tajikistan provides over half of total caloric intake and are also the primary source of protein in the local diet. Poor households spend a large amount of their income on wheat flour, wheat, and bread. (September 2012)

By July, many rural households in Tajikistan have completed the winter wheat harvest which usually starts in late May. However, colder than usual temperatures may have delayed the winter wheat harvest in some locations, especially at higher elevations. As wheat has come into the market, prices of both wheat and wheat flour declined slightly from May to June. Once wheat fields are cleared, second crops are planted on those same fields in irrigated areas though precipitation levels may have been high enough this year where some rainfed fields may support a second crop. Second crops tend to be fodder crops such as maize, barley, or alfalfa. In addition to these, in some areas rice, oilseeds, vegetables, melons, or pulses and legumes are planted for the second cropping. (July 2012)

Cumulative seasonal precipitation was substantially above the 2002-2011 average in all river basins within Tajikistan using satellite estimation of rainfall and snowfall. Data from rain gauges provided to the United Nations Development Program (UNDP) by the Tajik Hydrometerology Center indicates the same trend in participation. Five examined rain gauges reported 2011/2012 season precipitation above the 30-year average and far above last year. However, other than the station in Dushanbe, total precipitation for the 2011/2012 season was below the precipitation level from the 2009/2010 season which was a bumper wheat harvest. Only taking into account the precipitation level would indicate that the prospects for the wheat harvest are above average, but the wheat harvest still may not be as large as the bumper 2010 harvest. (June 2012)

Wheat flour prices in most markets in Tajikistan are generally below last year’s prices due to good regional supply of wheat, continuing relatively low export wheat prices in Kazakhstan, and a relatively high level of imports. Prices for wheat and wheat flour declined from May to June across much of Tajikistan. The Government of Dushanbe launched price controls to try to prevent the usual rise in price due to higher demand for some food products during Ramadan. Some traders moved from the city markets to other locations to avoid the price controls. (July 2012)

Vegetable oil prices remained relatively flat in June, and rice remained stable, but at prices much higher than last year. Potato prices in June continued to follow their usual season trend of slight increases as stocks decline before the next harvest in surplus-producing areas like the Rasht Valley. In areas where the potato harvest has already begun such as lower elevations in Gorno-Badakhshan Autonomous Oblast (GBAO), northern Tajiksitan, and southern Tajikistan, prices of potatoes have begun to fall. Low temperatures in key potato-surplus producing areas including the Rasht Valley though may delay the harvest which supplies much of the market. A report by Mercy Corps indicates that households in the Rasht Valley have lost an unusually high number of seed potatoes over the winter, so in addition to the unusually late start of the planting window, they may have difficulty sourcing seed potatoes for planting. Like the wheat harvest, the potato harvest may be significantly delayed in some areas, especially at higher elevations. Temperatures in June were largely near average though, so potato growing and other agricultural activities at higher elevations should be resuming. (July 2012)

An estimated USD 320.4 million of remittances have come into Tajikistan in June, resulting in another monthly record level, according to unofficial estimates. While remittances seasonally declined as they do every winter, they are now seasonally increasing. Remittances have remained at monthly record levels since November 2010, which roughly coincides with the period in which food and fuel prices first began their recent ascent. In June, the total number of economic migrants was similar to 2009 and 2011, but less than in 2010. Some reports indicate that increased migration may be a sign of household economic stress, but higher rates of migration have led to higher levels of remittances. Labor migration has, even during the Soviet Union, been an important economic activity for Tajikistan. (July 2012)