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EMMA of the wheat flour market system, Kyrgyzstan

Osh city, Aravan district and Jalal-Abad oblast
July, 2010

On 7 April 2010, violent civil protests erupted in the capital city Bishkek and provoked the dismissal of Kyrgyzstan's president. An interim ‘caretaker’ government was instituted, but tensions continued, leading to a vacuum of national counterparts in many institutions at central and local levels, freezing of bank assets, closure of borders, and disruption of the spring planting season. In June, Kyrgyzstan experienced ethnic violence and rapid displacement in the southern districts bordering Uzbekistan. Nearly 3,000 homes and businesses were damaged or destroyed in a 3-day period.

The EMMA assessment began several weeks after the initial violence in June and focused on early recovery needs for four selected critical markets (wheat flour, potatoes, CGI and cement) and the impact of humanitarian aid to date on the local market. This report covers the findings and recommendations for wheat flour, which was selected as a critical market system because bread is a staple food item and an important source of income for producers. The EMMA team selected farmers and bakers as the target population. Families with damaged or destroyed houses and small urban businessmen whose shops were damaged or destroyed were not selected because those populations, although the most directly affected by the violence, were being thoroughly covered by a large-scale, separate livelihoods assessment that was occurring concurrently with the EMMA.

Although wheat is a critical food in Kyrgyzstan, its low price and low profit margin means it is not a popular crop for smallholder farmers. Kazakh wheat flour, which is of comparatively high quality, plays an important role in the Kyrgyz flour market system. It is generally imported as grain and then milled in Kyrgyz mills before being purchased by bakeries or retailers. However, even prior to the June crisis, the closing of the borders with Kazakhstan had impacted the availability of wheat imports.

Following the June crisis, the wheat flour market has suffered several broken linkages, price spikes, and shortages of stock that are concerning for the near future. Producers, who face production limitations due to limited access to adequate machinery, are beset with steep yield losses due to this year’s dry and windy weather. Border closures and the flight of Uzbek casual farm labor has pushed up the cost of the important agriculture inputs of pesticide and labor, among others. Value-adding market actors like mills and bakers have been negatively impacted by the violence. Many bakeries, especially large-volume commercial bakeries, are closed or operating at significantly reduced capacity, their client base fractured and their transportation links dysfunctional.

This report recommends the following humanitarian responses: (1) cash distributions to the most affected farmers; (2) development of a public information system for crops and markets; (3) vouchers for bakers, retailers and/or vulnerable households; (4) cash for work for farmers to clear irrigation and other farm systems, and crews to clean up markets and businesses; and (5) advocacy for the Kyrgyz government to purchase a certain volume of wheat from farmers.

Report authors: 
Benjamin Barrows, Eugenia Gusev
Download Report (846.46 KB pdf)