Overview
Agriculture is an important sector of Uzbekistan’s economy, accounting for approximately 25% of GDP and employing about 26% of the labor force. Cotton and grain are the country’s principal crops, but elimination of quotas and price controls in 2020-2021 is facilitating a shift to higher-value fruit and vegetable cultivation. To continue the sector’s liberalization and reflect a steep rise in global wheat prices in 2022, the state switched to market prices starting from June 1, 2022, when purchasing and selling grain. Exports of agricultural products contributed approximately 8.4% to Uzbekistan’s external earnings in 2022. In June 2021 Uzbekistan and Russia signed an agreement and in November 2021 launched Agroexpress logistical corridor project, which allowed the delivery of agro-food products in refrigerator container trains within 4-7 days. In February 2022, the prime ministers of EAEU countries approved the implementation of the Eurasian AgroExpress project to facilitate trade with and expedited delivery of agro-food products to Uzbekistan and China.
The government hopes to double farmers’ income and ensure a minimum 5% annual growth of agriculture in 2022-2026 through intensive development programs, application of advanced scientific achievements, digitalization, and adoption of new technologies. The further development of processing and packaging capabilities to add value to domestic and export products also remains a priority. The following targets in processing capacities were set to reach by the end of 2023: fruit and vegetable - to 3.2 million tons, milk production - to 3 million tons, and meat processing - to 450 thousand tons. In total, $1 billion will be allocated for projects to create a high value chain in the agricultural sector in 2023. Support for creation of vertically integrated clusters, 633 of which had been registered as of 2022, and a cooperative system providing a complete production chain “from the field to consumer” to improve productivity, are a primary focus of ongoing agriculture reforms. Loans and grants in the amount of $600 million will be attracted to digitalize agriculture, increase land fertility, and introduce modern agricultural technologies. Agricultural Knowledge and Innovation Centers will be created in 2022-2026 in all regions, providing more than 100 types of agricultural services on a one-stop shop basis, including such important services as improving soil conditions, combating plant diseases, and selecting seeds. Uzbekistan also needs to invest in modernization of the existing infrastructure: it is estimated that $826 million will be spent on the modernization of 299 pumping stations in 2021-2026. The government plans to double textile production by 2026, improving Uzbekistan’s positioning in the value chain, and henceforth process more of its own raw cotton into intermediary or consumer goods for export. Agriculture consumes 90% of Uzbekistan’s water resources. The state is subsidizing the adoption of water-saving technologies and plans to save at least 7 billion cubic meters of water by 2026 through efficiency improvements. Uzbekistan currently ranks among the bottom 20 countries in the world in terms of water productivity, according to the World Bank, and produces only $0.6 per cubic meter of water compared with a global average of $15 per cubic meter.
To improve the country’s food security, the Government of Uzbekistan has emphasized wheat production and supported poultry and animal farming over the past few years. The 2022-2026 Program for the Development of the Livestock Sector and its Industries was adopted in February 2022. On April 20, 2023, the World Bank approved a $240 million loan for the Second Livestock Sector Development Project. The profitability of fresh fruit and vegetables has increased in recent years, and local farmers have aggressive plans for developing export markets for these products. In 2022-2025 the government will offer small family farms ten-year horticulture leases on 200,000 hectares of cotton and grain land transferred from large farms and clusters and allocate $100 million for supporting loans. 100,000 hectares of irrigated sown areas were leased to 400,000 small farmers in 2022, and another 100,000 hectares will be leased to 350,000 small farmers in 2023.
| 2020 | 2021 | 2022 | 2023 estimated |
Total Local Production | 15,041 | 17,297 | 18,863 | 20,500 |
Total Exports | 1,336 | 1,372 | 1,632 | 2,000 |
Total Imports | 1,851 | 2,510 | 3,393 | 4,000 |
Imports from the US | 10.4 | 1.9 | 2.3 | N/A |
Total Market Size* | 15,556 | 18,435 | 20,624 | 22,500 |
Exchange Rates** | 10,056 | 10,610 | 11,051 | 11,600 |
*Total market size = (total local production + imports) – exports
** Exchange Rates = Uzbek soums per $1.
Units: $ millions
Source: The State Statistics committee of Uzbekistan. Data for 2023 was estimated by Post using company project implementation progress reports. Data on imports from the U.S. is from the U.S. census bureau.
Leading Sub-Sectors
Cattle breeding and poultry farmingSeeds and seedlings (berries, fruits, nuts, vegetables, melons)Seeds and seedlings of ornamental plants (flowers)Technical solutions for microclimate control in greenhousesMills producing feed and feed additives for poultryStorage, packaging and processing of fresh vegetables and fruitsWater-saving irrigation technologiesPumping stations for water supply systems.
Opportunities
For specific opportunities, businesses should contact companies involved in Uzbekistan’s agricultural industry.
Resources
U.S. companies and individuals interested in learning more about upcoming procurements and export opportunities are encouraged to visit the following websites: