President of Uzbekistan Shavkat Mirziyoyev signed a decree on the introduction of market principles that ensure free competition in the production and sale of grain.
The document was adopted in order to raise to a new stage of reforms aimed at increasing the competitiveness of the agricultural and food industries, ensuring price stability in the domestic market, increasing investment attractiveness due to the complete rejection of government purchases in excess of the required volume of grain, as well as creating opportunities for the sale of grain on the exchange bidding without restrictions.
The decree provides for measures for the independent placement by economic entities of wheat varieties recommended for sowing on the territory of the republic from 2022 based on land and water conditions, in 2022-2024, free sale through exchange trading on average in the republic for 2.5 tons of grain from each hectare of the irrigated area sown with grain, the harvest of which was grown by grain clusters and farms, the rest – on the basis of direct contracts, as well as the allocation of concessional loans to grain farms, elite seed farms and grain clusters as part of the Seed Development Center.
The relevant departments were instructed, by January 1, 2022, to develop and submit to the Cabinet of Ministers for approval the procedure for the Fund’s purchase of grain at exchange auctions and its sale at the exchange in order to ensure price stability in the domestic market. At the same time, the followings have been envisaged:
• specific and transparent criteria for the determination and selection of a commercial agent for the purchase of grain at exchange auctions on behalf of the Fund;
• creation, along with the enterprises of the JSC “Uzdonmakhsulot” system, for other business entities engaged in grain processing in the regions, equal conditions in the selection of a commercial agent;
• responsibility of the commercial agent with all its property for grain purchased on behalf of the Fund;
• purchase by a commercial agent on behalf of the Grain Fund through the exchange from grain clusters and farmers, the right to land plots of which has passed state registration in the National Geographic Information System of the Cadaster Agency under the State Tax Committee;
• reimbursement of expenses of a commercial agent for the purchase, storage, natural loss, growth, transportation and renewal of the state grain reserve;
• placing purchased grain by the Fund for exchange trading in order to ensure the stability of grain prices in the domestic market;
• moreover, government bodies, including local khokimiyats of all levels and law enforcement agencies, are strictly prohibited from interfering with the conduct of agrotechnical measures in the production of grain crops and the provision of material-technical resources; in the direction of the use of allocated concessional loans; in the process of selling grain, including the conclusion of contracts, the attachment of farms to separate enterprises engaged in the procurement and processing of grain, in internal transportation between the regions of the republic.
It is also prohibited to send instructions in written or orally on the inclusion of such areas as livestock, poultry, fish farming and others in the activities of grain clusters.