Cost structure in Kazakhstan’s grain farming and methods of its optimisation
Abstract
The optimisation of costs in Kazakhstan's grain farming is a pressing issue driven by the need to enhance the economic efficiency of agricultural production amid rising resource costs and increasing competition in the international market. The objective of this study was to substantiate approaches to reducing costs in grain farming by analysing cost structures and assessing the effectiveness of technological and economic measures. The study employed variation statistics, regression analysis, econometric modelling, cost-benefit analysis, and investment profitability calculations to evaluate the efficiency of various production strategies. The research findings demonstrated that the key directions for cost optimisation included the introduction of minimum tillage technologies, particularly no-till and strip-till systems, automation of agrotechnical processes, rational use of fertilisers and plant protection products, as well as the utilisation of digital platforms for product sales. An analysis of statistical data for 2020-2024 indicated that the adoption of minimum tillage technologies contributed to a 50-60% reduction in fuel costs, a 20-25% decrease in machinery depreciation costs, and a 15-20% reduction in labour costs. Automated agricultural management systems enabled an 18-22% reduction in fertiliser and plant protection product costs due to precise resource distribution. Optimisation of logistical processes and constructing grain storage facilities contributed to a 12-18% reduction in product losses during transportation and a 10-15% decrease in logistics costs. The use of digital platforms for product sales ensured a 40-50% reduction in transaction costs and a 60% decrease in buyer search costs. The overall effect of implementing the proposed measures allowed for a 12-17% reduction in grain production costs, depending on farm scale and applied technologies. The proposed recommendations were aimed at reducing production costs, ensuring the financial stability of the agricultural sector, and enhancing the competitiveness of Kazakhstan's grain farming
Keywords
economic efficiency; technological innovations; minimum tillage; agricultural automation; resource management
[1] Akpan, S.B., & Umoren, A.A. (2021). Agricultural production indicators and the dynamic macroeconomic variables in Nigeria: ARDL model approach. Scientific Papers Series Management, Economic Engineering in Agriculture and Rural Development, 21(3), 111-124.
[2] Angon, P.B., Anjum, N., Akter, M.M., Shreejana, K.C., Suma, R.P., & Jannat, S. (2023). An overview of the impact of tillage and cropping systems on soil health in agricultural practices. Advances in Agriculture, 2023, article number 8861216. doi: 10.1155/2023/8861216.
[3] Ayim, C., Kassahun, A., Addison, C., & Tekinerdogan, B. (2022). Adoption of ICT innovations in the agriculture sector in Africa: A review of the literature. Agriculture & Food Security, 11, article number 22. doi: 10.1186/ s40066-022-00364-7.
[4] Baig, I.A., Mohammad, S., Akram, V., Chandio, A.A., & Gupta, Y. (2024). Examining the impacts of climatological factors and technological advancement on wheat production: A road framework for sustainable grain production in India. Environment, Development and Sustainability, 26(5), 12193-12217. doi: 10.1007/s10668023-03746-4.
[5] Belletti, Â., & Schneider, S. (2023). The relationship between agri-food production and macro-economic dynamics: A study on soybeans in Brazilian south and Chinese mainland. Agricultural & Rural Studies, 1(2), article number 0009. doi: 10.59978/ar01020009.
[6] Bulgakov, V., Nikolaenko, S., Holovach, I., Adamchuk, V., Kiurchev, S., Ivanovs, S., & Olt, J. (2020). Theory of grain mixture particle motion during aspiration separation. Agronomy Research, 18(1), 18-37. doi: 10.15159/ AR.20.057.
[7] Bureau of National Statistics of the Agency for Strategic Planning and Reforms of the Republic of Kazakhstan. (n.d.). Statistics of agriculture, forestry, hunting and fishery sector. Retrieved from https://stat.gov.kz/en/industries/ business-statistics/stat-forrest-village-hunt-fish/.
[8] Codex Alimentarius. (1963). Retrieved from https://www.fao.org/fao-who-codexalimentarius/home/en/.
[9] Conway, S.F., McDonagh, J., Farrell, M., & Kinsella, A. (2021). Going against the grain: Unravelling the habitus of older farmers to help facilitate generational renewal in agriculture. Sociologia Ruralis, 61(3), 602-622. doi: 10.1111/soru.12355.
[10] Dolia, S., & Shevchenko, M. (2024). Influence of primary tillage on some soil fertility indicators and corn yield. Ukrainian Black Sea Region Agrarian Science, 28(2), 33-41. doi: 10.56407/bs.agrarian/2.2024.33.
[11] Food and Agriculture Organization. (2024). The state of food and agriculture. Retrieved from https://www.fao. org/publications/fao-flagship-publications/the-state-of-food-and-agriculture/en.
[12] Gohin, A. (2023). On the sustainability of the French food system: A macroeconomic assessment. Applied Economic Perspectives and Policy, 45(2), 860-880. doi: 10.1002/aepp.13277.
[13] Gumarova, Z.M., Bulekova, A.A., Kushenbekova, A.K., Mukhomedyarova, A.S., Gubasheva, B.E., Jigildiyeva, Z.G., Sarsengaliyev, R.S., & Utegalieva, N.K. (2025). Optimizing tillage systems and cultivation practices for enhancing productivity of dark chestnut soils in Northwestern Kazakhstan. International Journal of Agriculture and Biosciences, 14(1), 164-171. doi: 10.47278/journal.ijab/2024.206.
[14] Guo, X., Wang, L., Meng, X., Dong, X., & Gu, L. (2023). The impact of digital inclusive finance on farmers’ income level: Evidence from China’s major grain production regions. Finance Research Letters, 58, article number 104531. doi: 10.1016/j.frl.2023.104531.
[15] Han, G., Arbuckle, J.G., & Grudens-Schuck, N. (2021). Motivations, goals, and benefits associated with organic grain farming by producers in Iowa, US. Agricultural Systems, 191, article number 103175. doi: 10.1016/j.agsy.2021.103175.
[16] International Grains Council. (n.d.). Grain market report. Retrieved from https://www.igc.int/en/gmr_summary.aspx.
[17] Jiang, S., Wang, Q., Zhong, G., Tong, Z., Wang, X., & Xu, J. (2021). Brief review of minimum or no-till seeders in China. AgriEngineering, 3(3), 605-621. doi: 10.3390/agriengineering3030039.
[18] Kenenbaev, S.B., Yesenbayeva, G.L., & Yelnazarkyzy, R. (2021). Resource-saving farming systems in the southeast of Kazakhstan. Natural Volatiles & Essential Oils, 8(4), 7938-7949.
[19] Khan, N., Ray, R.L., Kassem, H.S., Hussain, S., Zhang, S., Khayyam, M., Ihtisham, M., & Asongu, S.A. (2021). Potential role of technology innovation in transformation of sustainable food systems: A review. Agriculture, 11(10), article number 984. doi: 10.3390/agriculture11100984.
[20] Kim, S.-C., Chung, J.-K., Trusova, N., Akhmetova, Z., & Musayeva, N. (2025). Simulating global supply chain reverberations from Ukrainian grain shipment interruptions. Revista Iberoamericana de Viticultura Agroindustria y Ruralidad, 12(34), 192-207. doi: 10.35588/3c9rjg57.
[21] Kim, Y.J., & Lee, B.K. (2022). Containerized grain logistics processes for implementing sustainable identity preservation. Sustainability, 14(20), article number 13352. doi: 10.3390/su142013352.
[22] Kokеnova, A.E., Beisenova, M.U., Shalbayeva, A.P., Maulenberdieva, G.A., & Moldalieva, R.N. (2022). Improving the efficiency of grain production by improving management processes. Scientific Journal “Bulletin of NAS RK”, 2, 343-355. doi: 10.32014/2022.2518-1467.291.
[23] Krychkovska, L., Bobro, M., Birta, G., Karpushyna, S., & Grytzaenko, Yu. (2025). Application of biologically active substances in agriculture preparations. Plant and Soil Science, 16(1), 9-22. doi: 10.31548/plant1.2025.09.
[24] Kulazhanov, T., Uazhanova, R., Baybolova, L., Yerzhigitov, Y., Kemerbekova, A., Tyutebayeva, K., Izembayeva, A., & Zhengiskyzy, S. (2024). Ensuring quality and safety in the production and storage of grain crops. Caspian Journal of Environmental Sciences, 22(5), 1279-1284. doi: 10.22124/cjes.2024.8343.
[25] Mardaneh, E., Loxton, R., Meka, S., & Gamble, L. (2021). A decision support system for grain harvesting, storage, and distribution logistics. Knowledge-Based Systems, 223, article number 107037. doi: 10.1016/j. knosys.2021.107037.
[26] Mendes, I.C., Sousa, D.M., Dantas, O.D., Lopes, A.A., Junior, F.B., Oliveira, M.I., & Chaer, G.M. (2021). Soil quality and grain yield: A win-win combination in clayey tropical Oxisols. Geoderma, 388, article number 114880. doi: 10.1016/j.geoderma.2020.114880.
[27] Olorunfemi, B.J., & Kayode, S.E. (2021). Post-harvest loss and grain storage technology – a review. Turkish Journal of Agriculture-Food Science and Technology, 9(1), 75-83. doi: 10.24925/turjaf.v9i1.75-83.3714.
[28] Organisation for Economic Co-operation and Development. (2023). Agricultural policy monitoring and evaluation 2023: Adapting agriculture to climate change. Retrieved from https://surl.li/kfccbx.
[29] Pan, Y., Zhang, S., & Zhang, M. (2024). The impact of entrepreneurship of farmers on agriculture and rural economic growth: Innovation-driven perspective. Innovation and Green Development, 3(1), article number 100093. doi: 10.1016/j.igd.2023.100093.
[30] Prajapati, D., Chan, F.T., Daultani, Y., & Pratap, S. (2022). Sustainable vehicle routing of agro-food grains in the e-commerce industry. International Journal of Production Research, 60(24), 7319-7344. doi:10.1080/00207543. 2022.2034192.
[31] Rosentrater, K.A. (2022). Economics of grain storage. In Storage of cereal grains and their products (pp. 687-696). London: Woodhead Publishing. doi: 10.1016/B978-0-12-812758-2.00005-2.
[32] Różewicz, M. (2022). Review of current knowledge on strip-till cultivation and possibilities of its popularization in Poland. Polish Journal of Agronomy, 49, 20-30. doi: 10.26114/pja.iung.488.2022.49.03.
[33] Sembayeva, A.S., Ospanbayev, Z.H., Zhapayev, R.K., Kenenbaуev, S.B., Pejic, B., Kunypiyaeva, G.T., Doszhanova, A.S., & Bekbauov, M. (2025). Corn hybrids assessment for grain yield under the soil tillage regimes and drip irrigation in Southeast Kazakhstan. Journal of Breeding and Genetics, 57(1), 46-55. doi: 10.54910/sabrao2025.57.1.5.
[34] Sivojiene, D., Kacergius, A., Baksiene, E., Maseviciene, A., & Zickiene, L. (2021). The influence of organic fertilizers on the abundance of soil microorganism communities, agrochemical indicators, and yield in East Lithuanian light soils. Plants, 10(12), article number 2648. doi: 10.3390/plants10122648.
[35] Suleimenova, N., Orynbasarova, G., Suleimenova, M., Bozhbanov, A., & Yerekeyeva, S. (2021). Environmental monitoring of the sustainability and productivity of the agroecosystem of oilseeds in South-East Kazakhstan. Journal of Ecological Engineering, 22(7), 89-99. doi: 10.12911/22998993/139114.
[36] Tadjiev, A., Djanibekov, N., & Herzfeld, T. (2023). Does zero tillage save or increase production costs? Evidence from smallholders in Kyrgyzstan. International Journal of Agricultural Sustainability, 21(1), article number 2270191. doi: 10.1080/14735903.2023.2270191.
[37] Taishykov, Z., Tolysbayev, B., Kuantkan, B., Koichubayev, A., & Baigabulova, K. (2023). Innovation management in agricultural production in Kazakhstan. CABI Reviews. doi: 10.1079/cabireviews.2023.0022.
[38] Tolepbergen, A. (2022). The role of labor market structure and shocks for monetary policy in Kazakhstan. International Journal of Economic Policy Studies, 16(1), 179-210. doi: 10.1007/s42495-021-00073-2.
[39] Turebayeva, S., Zhapparova, A., Yerkin, A., Aisakulova, K., Yesseyeva, G., Bissembayev, A., & Saljnikov, E. (2022). Productivity of rainfed winter wheat with direct sowing and economic efficiency of diversified fertilization in arid region of South Kazakhstan. Agronomy, 12(1), article number 111. doi: 10.3390/agronomy12010111.
[40] World Bank. (n.d.). Kazakhstan overview: Development news, research, data. Retrieved from https://www. worldbank.org/en/country/kazakhstan/overview.
[41] Yaheliuk, S., Fomych, М., & Rechun, O. (2024). Global market trends of grain and industrial crops. Commodity Bulletin, 17(1), 134-145. doi: 10.62763/ef/1.2024.134.
[42] Zhapayev, R.K., Kunypiyaeva, G.T., Mustafaev, M.G., Doszhanova, A.S., Isabay, B.T., Maybasova, A.S., Isabay, B.T., Myrzabayeva, G.A., & Omarova, A.Sh. (2023). Different tillage regimes’ effect on soil-water physical and agrochemical properties under the environmental conditions of Southeast Kazakhstan. Journal of Breeding and Genetics, 55(5), 1831-1842. doi: 10.54910/sabrao2023.55.5.34.