In the Fergana Valley, in particular, in the south of Kyrgyzstan, cotton harvesting has begun. Previously, cotton was the main source of income for the local budget, now it is grown only by those who are sure that they can realize it at a favorable price.
Over the past decade, cotton production has fallen three times.
The cotton market in the south of Kyrgyzstan is mainly occupied by Russian and Uzbek firms.
Last year for local cotton growers was not very successful. The main reason was the decline in the cost of this raw material in the global market. The farmers themselves tend to blame large cotton corporations for this, which monopolized the local cotton market, dictating low prices to farmers. Returning to stock prices, it can be emphasized that if the year before last in the 2003–2004 season. per ton of cotton fiber on the exchanges were given $ 1506, then last year in the 2004-2005 season. price dropped to 1,148 dollars. Let me remind you that out of 3 tons of raw cotton, approximately 1 ton of cotton fiber is produced. As a result, the peasants suffered. They had to sell raw materials at a price that does not even cover its cost price. In Kyrgyzstan, the price of raw cotton dropped to 8-10 soms (20-25 cents) per kg. But the profit of intermediary structures amounted to at least 15 cents per kilogram. The cotton growers themselves explain this by the fact that in Kyrgyzstan the cotton purchase market is monopolized. “In recent years, the same people buy cotton, and they, having agreed among themselves, set the price, but they do not let buyers in from the outside,” says the cotton grower Asan Abduraimov. Indeed, the middleman continues to dictate prices in the agricultural raw materials market. Not being able to independently sell their produce, cotton growers are forced to turn only to him. No choice.
Meanwhile, experts of the International Cotton Consultative Committee (ICAC) explain the reason for the sharp decline in prices by the fact that in recent years the price of cotton was very high, and producing countries increased cotton crop areas in order to obtain super-profits. Naturally, due to the production boom, demand was far behind the supply. The huge supply of cotton fiber, the relatively low demand for it, as well as the sluggishness of buyers in purchasing (associated with the expectation of further price reductions) led to a significant drop in prices. In the season 2003-2004. in the world, 20.6 million tons of cotton fiber were produced, and in 2004–2005 production reached 23.5 million tons.
The important role of lower prices in Kyrgyzstan was also played by the fact that last year smuggled as much raw cotton from Uzbekistan to Kyrgyzstan, according to various sources, could not be harvested by Kyrgyz cotton growers even in two years.
In neighboring Uzbekistan, as one cotton grower says, peasants rent cotton, as in Soviet times, to the state. They get paid for it with wheat. To get 500 kg of wheat, the Uzbek farmer must take care of one hectare of cotton from April to August. But among them there are brave souls who manage to earn a lot of money by exporting some of the grown produce to Kyrgyzstan, where they are already paid for it in cash. According to the ICAC in the 2004-2005 season. 27 thousand tons of cotton fiber were produced in Kyrgyzstan. For comparison: in the same Uzbekistan - 1 million. 73 thousand tons, in Kazakhstan - 136 thousand tons, in Tajikistan - 177 thousand tons.
The rise in prices for fuel and lubricants, agricultural fertilizers and chemicals has led the peasants to bankruptcy. “Last year's price reduction is not the main reason for the bankruptcy of Kyrgyzstan’s peasants. The main reason, I believe, is that the weather has “let down”, says the agronomist Kudaiberdi Mamytov. According to the agronomist, in good weather, the cotton growers of Kyrgyzstan can harvest up to 50 centners per hectare, and last year they managed to collect only 15 centners each. In the climatic conditions of Kyrgyzstan, growing cotton is a risky business, but, despite this, the peasants sow cotton in the hope of a good profit. This year cotton growers plan to collect at least 35 centners per hectare, and also hope to raise prices.
Some indices show that the price of cotton is gradually rising due to the revival of demand, but international analysts do not give the most comforting forecasts. According to ICAC experts, the price this year is unlikely to reach the level of 2003-2004.
According to ICAC forecasts, in the near future world cotton production will decline, and will be 22 million tons, and for a ton of cotton fiber, for the time being, they are offering 1,168 dollars, which is 12 dollars more than last year’s price. Buyers are already turning to the peasants of Kyrgyzstan and offering 12 soms (30 cents) for raw materials that have not yet been collected. So far, this price of local peasants is not satisfied, and Uzbek cotton growers already agree to deliver goods to the buyer for this amount.
Looking from the Uzbek side
According to Prime-Tass, a representative of Uzbekistan’s cotton monopoly, Uzkhlopkoprom, predicts a 6.6 percent increase in cotton exports in 2005 compared with the previous year. This year it is planned to harvest 3.6 million tons of raw cotton, i.e. slightly more than in 2004. For the troubled Uzbek economy, cotton export is the most important export item, which gave the country nearly $ 900 million in 2003. Uzbekistan is in fifth place in the world in cotton production.
However, the dekhkans themselves receive money for their work that is incomparable with those that the state receives for the same. The farmer must hand over most of his harvest to the state at a fixed price. For example, the analyst of the Crisis Prevention Group (formerly called the International Crisis Prevention Group) Michael Hall claims that women are the most vulnerable in this regard because they do almost all the work but get much less than men. “The only reason women work in the cotton fields in general is that they are allowed to pick cotton stalks ... one of the main sources of heat in the winter months in rural areas,” the analyst says.
In addition, with the active harvesting, it has long been a kind of “tradition” that child labor is widely and widely used throughout the country.
Without getting any benefit from growing cotton, Uzbek farmers are forced to cross the border with Kazakhstan to hire cotton pickers to Kazakhstani owners or illegally bring the harvested cotton to Kazakhstan or Kyrgyzstan, since such a business brings real cash and much more than in Uzbekistan itself. According to IWPR, whole families leave for similar earnings and a lot to bypass border checkpoints, so it’s hard to calculate how many Uzbeks work in Kazakhstan’s cotton plantations.
As for the smuggling of Uzbek cotton into the neighboring republics, this work is also associated with a certain risk. For example, there is a case when three Uzbeks tried to ship 200 kg of cotton to Kyrgyzstan. They were shot by Uzbek border guards. For these 200 kg in Kyrgyzstan, they would have earned only $ 50.