Closure of the market in Afghanistan: how the situation will affect Kazakhstan

Not long ago, the international community was alarmed by the news of the Taliban coming to power in Afghanistan. This led to the freezing of accounts in the country’s central bank, the suspension of all state processes, including the formation of the budget. The revolution affected the agricultural industry as well — the closure of the Afghan market made the supply of flour and grain from Kazakhstan uncertain. And given the fact that Kazakhstan is virtually the only exporter of such products in the country, this fact brings serious problems for both sides.
Experts note that the unstable political situation in Kabul has a negative impact on Kazakhstan, as 50% of all deliveries here are made in Afghanistan. In the past years, Kabul imported about 3.5 million tons of flour and grain, and most of these products were bought directly. In addition to this supplier, last year Afghanistan bought 721 thousand tons of flour from Uzbekistan, which was produced from Kazakh grain. This volume is equivalent to 1 million tons of wheat.
Experts note that in previous years, imports were financed by the U.S. government, and now it’s hard to say where the Taliban will take the money to maintain the country’s food market. All transactions in dollars and euros are blocked for Afghan banks, and given the illegitimacy of the current government in Kabul, exporters will not work with it without full payment for goods. Afghanistan's market closure Analysts do not rule out the possibility of a return to the situation observed in the early 2000s. Back then, the main way to get food for Afghanistan was through humanitarian aid provided by international organizations. The UN has for some time been receiving alarming signals that there is a high risk of famine in Afghanistan, and therefore it is necessary to develop an aid delivery plan. However, the supply of grain through humanitarian channels requires the implementation of a number of measures, which take a long time.
Closure of the Afghan market is fraught with negative consequences for Kazakhstan, which has lost a major customer. Export potential of the country is about 6.5 million tons of grain, half of which used to be purchased by Kabul. However, now all of this production may remain in the domestic market, as the search for new importers will take quite a long period.
Now Kazakh sellers are making efforts to increase exports to Iran in addition to traditional markets. An important advantage compared to competitors from Russia is the absence of import duties on wheat. And due to this, Kazakh traders want to increase the volume of shipments. However, there are no new major contracts so far, so it remains to wait for the improvement of the situation in Afghanistan.