Small producers and vulnerable populations could benefit from food hubs in Kyrgyzstan

Agricultural development in Kyrgyzstan is being hampered by farmers’ lack of access to quality seeds, finance and market information, according to a new FAO assessment of value chains and the agribusiness environment.

Additional factors slowing the development include scattered production and the prevalence of production cooperatives over service ones, said the report, which also offered a number of recommendations for improvement.

“Kyrgyzstan has great potential to improve its agricultural value chains, and FAO's report highlights many areas for future action in the development sector to address the gaps,” said FAO agrifood economist John O’Connell, a co-author of the report.

Value chain analyses look at the full range of activities involved in bringing products from farms to consumers. FAO promotes the development of sustainable value chains in which value-adding activities are profitable, have broad-based benefits for farmers and society and use natural resources responsibly.

Key findings and recommendations
The report highlights that farmers experience constraints in accessing credit, such as high interest rates and short maturity of subsidized credit. Other challenges elaborated on by the report include an outdated and inconsistent legal framework, limited resources for assuring veterinary and phytosanitary safety, outdated technologies, and limited access to science-based knowledge and techniques.

The Kyrgyz Government is constructing logistics centres of various types, including some related to agriculture and food. The report recommends expanding these centres into high-grade “food hubs” that facilitate the collection, storage, processing, distribution and marketing of locally or regionally produced food products.

These hubs could be platforms for social interaction, capacity building and knowledge sharing, with small producers and low-income consumers as the main beneficiaries. Such centres might house seed-distribution and storage functions, with regional hubs even containing certification agencies and customs offices. Meeting rooms would allow the delivery to farmers of trainings that build agricultural and business skills.

A lack of cooperation among farmers is prevalent in the country. Of the 400-plus officially registered agricultural cooperatives, the majority exist only on paper. Functioning cooperatives are mainly focused on production; only a small number are oriented towards service. Service cooperatives enable farmers to collaborate on such activities as sorting, packaging and branding.

The report recommends raising awareness among farmers of service forms of cooperation and showcasing successful stories. Joint seed procurement and marketing, for example, could minimise the scattered production problem that arises from differences in farmers’ crop varieties and soil quality.

By promoting the service form of cooperation and forming service cooperatives around food hubs, farmers could deliver even more fresh food to low-income consumers, retailers, schools, hospitals and restaurants.

“Food hubs should increase small- and medium-sized producers’ access to wholesale market channels,” said co-author Pavel Kiparisov, an FAO strategic programme and technical support officer. “Food hubs also serve their neighbourhood, improving access to quality food for vulnerable populations.”

On-site access to laboratory testing facilities is recommended, to assure the application of controls for food safety and plant health. Piotr Wlodarczyk, an FAO agricultural officer, notes that it is important that for the purposes of certification for export such facilities may need to be operated by the relevant official agencies of Kyrgyzstan.

The report also recommends the development of organic farming and certification. The country’s Issyk-Kul region has underutilized potential in developing ecotourism and organic production. Farmers producing fresh apple juice from their own produce, for example, could benefit from converting to organic agriculture and certification, which would offer wider market opportunities and contribute to sustainable agriculture and ecotourism development in the area.

Recommendations provided in the report aim to guide the FAO country office in Kyrgyzstan and other development organizations operating in the country concerning value chain development programmes.

The report is part of a series of studies from the Regional Initiative on Improving Agrifood Trade and Market Integration analysing value chain gaps in selected countries of Europe and Central Asia, such as Azerbaijan, Republic of Moldova and Ukraine.

1 October 2018, Bishkek, Kyrgyzstan