Logistics Issues Halt Price Growth for Kazakh Wheat

Last week, the grain market situation in Kazakhstan was characterized by moderate trading activity. A major factor influencing the market was difficult logistics: a critical accumulation of railcars formed toward Uzbekistan, which significantly slowed export volumes and completely halted price growth for wheat. Meanwhile, previously announced forward prices from the Food Corporation did not have a noticeable impact on the market environment. This was reported by Yevgeniy Karabanov, head of the analytics committee of the Grain Union of Kazakhstan.

According to the Grain Union of Kazakhstan, domestic prices for grain crops on an EXW-elevator basis (in tenge per ton, including 16% VAT) stood as follows: 3rd class wheat with 23-24% gluten is priced at 89-93 thousand tenge, with 25-26% gluten at 91-95 thousand tenge, and with 27% gluten at 96-100 thousand tenge. 3rd class wheat with 28-29% gluten trades at 100-105 thousand tenge, while wheat with 30%+ gluten reaches 106-110 thousand tenge. 4th class wheat is priced at 86-89 thousand tenge, 5th class wheat at 82-86 thousand tenge, and feed barley rose by 1 thousand tenge to 67-71 thousand tenge per ton.

Export quotes on a DAP Saryagash basis were fixed at the following levels: 3rd class wheat (23-24% gluten) — $265-270 per ton, (25-26% gluten) — $267-272, (27% gluten) — $269-274, (28-29% gluten) — $282-287, (30%+ gluten) — $295-300 per ton. 4th class wheat costs $255-260, and 5th class wheat costs $245-250 per ton. Feed barley on a DAP Saryagash basis increased by $5 to $205-210 per ton, with the same price recorded on a FOB Aktau basis, while barley at the Dostyk/Altynkol crossing rose by $2 to trade at $207-212 per ton.

Yevgeniy Karabanov noted that export shipments of wheat and barley are being hindered by excessive load on the infrastructure of Kazakhstan Temir Zholy (KTZ). More than 10,000 railcars have accumulated in the area of the Saryagash interstate junction, which is 46% above normal. For comparison, a year ago the backlog was about 7,000 railcars, while the Uzbek side continues to receive trains at a steady rate—averaging 31 trains per day compared to 32 trains last year.

Due to this crisis, KTZ is forced to introduce strict restrictions from October 12 to 31, limiting the intake of grain railcars to no more than 300 per day toward Saryagash. In addition, grain-car operator Astyk Trans previously restricted the supply of railcars to the Kakir station due to slow unloading, and a difficult situation persists at the Bolashak junction. Amid these logistical hurdles, barley exports are actively shifting toward China and Central Asia, while shipments to Iran are stagnating due to a vessel shortage and rising freight rates.