Agriculture
investment priorities
U.S.
investors will find fertile opportunities
The
Ministry of Agriculture has set out the following
investment priorities by agricultural sector
or product:
*
Grain: In the year 2000, 1.5 million tons of
grains were produced. The production rate of
about 2400 kg/hc. can be increased perhaps to
5-6000 kg/hc. Domestic shortfall is still about
700,000 tons per year.
*
Fruits and Vegetables: Azerbaijan produces superb
quality vegetables and fruits. Processing facilities
are lacking, however. Forty-seven canning factories
operate, but only 20 percent of fruits and vegetables
were processed in canning plants in 2000. For
development of this sector, Azerbaijan needs
the establishment of service structures and
processing plants for packaging, preservation
and transportation of fruits and vegetables.
Largest potential now: tomato paste, apple juice
and other natural fruit juices. Azerbaijan seeks
about $20 million in investment in this sector.
*
Tobacco: Azerbaijan currently grows about 15,000
tons of tobacco per year. The potential is twice
that. There are seven tobacco fermentation factories
and one tobacco plant.
*
Tea: Tea fields total about 7000 hectares; there
are 16 tea processing and packing factories.
Export possibilities to the Middle East and
Turkey are good.
*
Viticulture and winemaking: There are 117 primary
processing factories for grapes in the republic,
and one very modern bottling plant for wine
and vodka in Baku. Good soils, specialists and
labor exist in every region. Total production
potential of the factories is 1.25 million tons.
Investment is sought in grape and grain cultivation
for wine and vodka, processing and consumption
matters. There is a large and urgent need for
a glass tare factory; at present, the country
imports all its bottles. Azerbaijan has the
raw material for production of green glass tare.
The ministry estimates about $85 million in
investment is needed here.
*
Cotton and silk: If world prices can rebound
from historic lows, the potential for cotton
as a foreign exchange earner in Azerbaijan is
enormous. Today, however, 70 percent of cotton
is sold as raw cotton. Azerbaijan is interested
in the construction of several cotton spinning
factories of different capacities, and plants
for the production of textiles. The ministry
estimates about $165 million in investments
is needed in this sector.
*
Meat, poultry and animal husbandry: Since privatization,
Azerbaijan is approaching self-sufficiency in
some meat production. However, 24 percent of
meat products and 35 percent of eggs are imported.
There are 97 large poultry factories in the
republic processing 60,000 tons of poultry.
The country imports about 40,000 tons of poultry
annually. The ministry seeks to diminish importation
of foodstuffs in this sector by:
a. Intensively
developing livestock husbandry and poultry,
improving cattle breeding, and increasing forage
production.
b. Implement changes
in meat and poultry processing. Milk processing
and meat plants need to be re-established and
brought up to modern standards and requirements.
The
ministry estimates that $120 million in investments
are needed in the animal husbandry and poultry
sector.
*
Sugar: Sugar beets are grown in 20 regions of
the republic, but there is no processing plant.
It is expected that domestic demand for sugar
will reach 360,000 tons annually by 2005. The
ministry is looking for investment to build
three sugar beet processing plants.
·Material
resources and service: Tractors, combines and
other agricultural machinery have reached the
end of their useful lives. There is a great
demand for a technical service enterprise for
agriculture. The ministry believes some 3,200
service centers need to be established at a
cost of $200,000 each. There are also old agricultural
machine factories that the ministry believes
can be upgraded through joint ventures to produce
farm machinery.
*
Fertilizers: A large super-phosphate factory
has been cut off from traditional sources of
the raw material, and so does not operate. Moreover,
increased natural gas will provide a ready source
of raw material for petroleum-based fertilizers.
*
Wholesale markets (trading houses): Creation
of large wholesale trading houses and improved
transportation will ensure greater quality control
in agriculture.