Pastoral Farming in the Ili Delta, Kazakhstan, under Decreasing Water Inflow: An Economic Assessment

Elisabeth Baranowski, Niels Thevs, Altyn Khalil, Azim Baibagyssov, Margulan Iklassov, Ruslan Salmurzauli, Sabir Nurtazin and Volker Beckmann
Additional contact information
Elisabeth Baranowski: Faculty of Law and Economics & Institute of Botany and Landscape Ecology, University of Greifswald, 17487 Greifswald, Germany
Niels Thevs: World Agroforestry Centre, Central Asia Office, Bishkek 720001, Kyrgyzstan
Altyn Khalil: Faculty of Law and Economics & Institute of Botany and Landscape Ecology, University of Greifswald, 17487 Greifswald, Germany
Azim Baibagyssov: Department of Biodiversity and Bio-resources, Faculty of Biology and Biotechnology, Kazakh National Al-Farabi University, Almaty 050040, Kazakhstan
Margulan Iklassov: Department of Biodiversity and Bio-resources, Faculty of Biology and Biotechnology, Kazakh National Al-Farabi University, Almaty 050040, Kazakhstan
Ruslan Salmurzauli: Department of Biodiversity and Bio-resources, Faculty of Biology and Biotechnology, Kazakh National Al-Farabi University, Leading expert of Remote Sensing Center of the Earth at Al-Farabi Kazakh National University, Almaty 050040, Kazakhstan
Sabir Nurtazin: Department of Biodiversity and Bio-resources, Faculty of Biology and Biotechnology, Kazakh National Al-Farabi University, Almaty 050040, Kazakhstan
Volker Beckmann: Faculty of Law and Economics & Institute of Botany and Landscape Ecology, University of Greifswald, 17487 Greifswald, Germany

Agriculture, 2020, vol. 10, issue 7, 1-29

Abstract: River deltas provide the most productive pastures in Central Asia. Simultaneously they are highly vulnerable to water inflow changes. The aim of this study was to conduct an economic assessment of the short- and medium-term effect of reduced water inflow on farmers’ performance within the Ili Delta. Primary data were collected through 35 interviews with farmers and additional experts in 2015. Production parameters for three types of individual farms were estimated and entered into a full cost accounting. Contribution margins were calculated for three scenarios: (I) sufficient water inflow (normal situation), (II) decreasing water inflow, and (III) significantly reduced water inflow (worst case). Farmers purchase hay to adapt to pasture production loss due to decreasing water inflow. This more than doubled the variable costs of worst case in comparison to normal situation for small-, medium-, and large-scale type of individual farm. Monte Carlo simulation indicates a risk of 74% (small-scale farm) and 3% (medium-scale farm) that already variable costs will exceed revenues. Despite their high fixed costs, only large-scale individual farms generate positive net farm income from operations in the worst case due to government payments from participation in elite bull program that account for one-third of total revenue.

Keywords: pastoral farming; contribution margin analysis; net farm income from operations; Monte Carlo simulation; individual farm; Ili Delta; Central Asia (search for similar items in EconPapers)
JEL-codes: Q1 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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