Greek food & drink manufacturers: here are your options in Kazakhstan

Right now, trade between Greece and Kazakhstan is not focussed on food and drink items. Even so, there are plenty of big market entry points for Greek manufacturers into Kazakhstan’s food import market.

Overall trade is also scheduled to pick up. In 2018, bilateral trade grew 10.6% between the two states, hitting a total of $980 million.

To boost this past that magic $1 billion figure, Alternate Minister of Foreign Affairs of the Hellenic Republic Georgios Katrougkalos, and Kazakhstan’s Deputy Minister of Foreign Affairs Roman Vassilenko, are spearheading increased trade activity amongst their respective nations.

Agricultural products, and food and drink, have been identified as one area both nations are keen to grow. So, what are the best hopes for Greek exporters on the Kazakhstan import market? Read on to find out.

Greek food in Kazakhstan: small volumes but room to grow

In 2016, according to data from the MIT’s Atlas of Economic Complexity Trade Database, Greece exported foodstuffs worth $1.5m to Kazakhstan. This includes animal products, oils and fats, and fruits and vegetables.

Relatively Small levels, given that Kazakhstan food imports tend to be worth around 10% of its total GDP – in excess of $1 billion a year – but this is a solid foundation to build on.

Fruits are the largest individual group, accounting for $651,000 in exports. Going into a bit more detail, Kazakh’s favoured strawberries, mandarins, clementines and citrus fruits from Greek suppliers.

Of course, olives and olive oil are well represented on Kazakh import manifests. Olive exports came in at $152,000 – or 10% of total Greek shipments – in 2016, whereas olive oil, including pure and virgin verities, added an extra $104,000 to the total.

Again, these are relatively small shipments – but there are some key sectors where Greek companies can really find their feet in this vibrant market.

Tea & coffee, fruits & vegetables biggest export hopes for Greek suppliers to Kazakhstan

Two key sectors Kazakhs import vast quantities of are fruits and vegetables and tea and coffee. For Greek producers, these represent enormous export potential.

Tea, for instance, is essentially inseparable from Kazakhstan culture and everyday life. 99% of Kazakhstan’s population of 17 million people drinks tea daily. Over half drink four or more cups a day. As such, the nation is the world’s tenth largest consumer of tea, with its citizens consuming 1.54 kg per person per year.

You may think such a strong tea sector would be dominated by domestic manufacturers. This isn’t the case. Production of tea, as well as coffee products, collectively amounts to 21,000 tons a year on average. Consumption is nearly triple this output, at close to 60,000 tons – meaning there’s a supply gap of some 40,000 tons to be filled.

Coffee is nowhere near as well established as tea in Kazakhstan, but over the past decade, coffee sales have started to expand. The culture of coffee drinking is being enhanced by a greater number of coffee shops popping up in major cities like Almaty and Astana. Imports stood at $4.82m in 2016.

Moving away from hot drinks, Kazakhs are increasing the levels of fresh fruit and vegetables they eat.

By 2020, its estimated total average consumption of fruits and vegetables will have reached over 1.1 million tons – 200,000 tons more than the current volumes eaten or processed across Kazakhstan.

Data from Kazakhstan’s State Statistics Commission shows the volume of agricultural goods Kazakhstan imports, including:

Grapes – 142,000 tons
Apples – 127,000 tons
Onions and garlic – 165,000 tons
Dried fruit and nut mixes – 86,000 tons
Carrots, turnips, and beets – 82,000 tons
Tomatoes – 65,000 tons

Of course, olives are a Greek speciality – and already one of the top products Greek suppliers sell to Kazakh buyers. The volumes of fresh produce in demand nationwide play into agricultural exporters’ hands – and this is an exceptionally lucrative sector in Kazakhstan right now.

Indeed, domestically-produced olive oil is considered a lower quality compared with imported varieties, so real, authentic Greek oil stands a good chance of wowing Kazakh buyers.

Processed fruits and vegetable goods are also very much in demand. Domestic production rarely tops out at above 20,000 tons. Demonstrating demand for these items are the import volumes – some 229,000 tons annually. This is also another growing sector. By 2020, it’s estimated that Kazakhs will be consuming over 252,000 tons of processed fruit and veg.

Greek producers can supply Kazakhstan’s growing food manufacturing sector

Kazakhstan’s food production and processing industry is an important one. Its activities, similar to food imports, cover 10% of GDP – although the nationwide Modernisation 3.0 programme is set to enhance the sector with modern equipment and machinery to increase its efficiency, manufacturing capabilities, and GDP share.

Greek companies stand to benefit from this nationwide investment and upgrade regime in some significant ways.

Firstly, there are raw ingredients, from fruits, vegetables, oils, sugars, and all raw foodstuffs. Kazakhstan produces food and drink items from ready meals to confectionery and everything in between. The country’s output grew 8% in 2017, so its 250+ manufacturers are set to consume more ingredients to keep this momentum going.

On the other hand, much of the processing and manufacturing equipment across Kazakhstan is nearing obsolescence or already out of date. As a result, producers are handicapped in the levels of output growth they can achieve, and the types of added-value goods they can produce.

Greek manufacturers of food production machinery and equipment can find plenty of selling opportunities in Kazakhstan – especially as the nation looks to diversify its economy away from energy over the coming decades.

Greek brands: meet new partners at WorldFood Kazakhstan

World Food Kazakhstan is a wide-ranging exhibition, showcasing the very best products to Kazakhstan’s food and purchasing decision makers. The event has become a major meeting place for the industry, welcoming thousands of visitors from Kazakhstan and the wider Central Asia region, and hundreds of international exhibitors.

For Greek producers, it is the place to meet over 5,000 professional buyers, including retailers, wholesalers, HoReCa sector players and many more Kazakh food and drink industry figures.

Interested in taking part? Book your stand here.
For more information, contact a member of our team today.

Created on 29 March 2018.