Assessing the effects of potential introduction of an export duty on wheat in Kazakhstan

Relevance . Potential restrictions on wheat exports, risks of disruptions to its transportation, and increased market uncertainty highlight the need to assess regulatory measures for Kazakhstan’s wheat market. The purpose is to find out the impact of the potential introduction of an export duty on the wheat market in Kazakhstan. Objectives : to assess the consequences of wheat export regulation methods; to verify the feasibility of wheat export restrictions, considering availability indices and grain self-sufficiency indices in Kazakhstan. Methodology . The paper uses the method of analyzing stakeholders who benefited or suffered from the introduction of an export duty on wheat in Kazakhstan. The paper uses a model to estimate the effects of an export duty on wheat. Results . Under the effect of the export duty, the surplus of producers in Kazakhstan will be reduced by $163.4 million. Part of these losses, equal to the total revenue from the duty, will be transferred to the state budget. (USD 141.9 million). Domestic wheat consumers will benefit from increased purchases and lower prices, and their surplus will increase by $5.4 million. The net result of the Republic of Kazakhstan from the introduction of export duties is losses in the amount of 57.8 million US dollars. Conclusions . Wheat exports in Kazakhstan should not be restricted. The republic has sufficient wheat supplies, with a low risk of shortages, as evidenced by high stocks-to-use ratios. Export duties on wheat are a counterproductive measure that could reduce the investment attractiveness of the sub-sector. Export duties carry the risk of losing hard-won foreign markets if reduced supplies from Kazakhstan’s exporters are replaced by products from competing countries. It is important not to hinder the increase in wheat production so that there is enough for both growing domestic demand and exports.