Azerbaijan International

Autumn 2000 (8.3)
Pages 28-31

Seeds of Change
Transition in Azerbaijan's Agriculture

by Arzu Aghayeva

Above: Summer fruits at the Taza Bazaar in Baku. Photo: Blair

Agriculture has long been a strong point for Azerbaijan. The country's mix of rich farmland and a wide range of climatic zones help support a wide variety of crops. But like other industries, agriculture is still struggling to cope with the country's new market economy. Under the Soviet system, Azerbaijan had a built-in market for its vegetables, fruits, cotton, wool and raw silk, since they were all sent to the All-Union Fund. In turn, the Republic received products that it needed, like meat, dairy products and grain.

Since independence, Azerbaijan has had to find new markets for its agricultural products as well as new suppliers for the items it has yet to produce itself. We talked to two experts from Azerbaijan's Ministry of Agriculture about Soviet planning and today's complex rebuilding process. Both agree that, despite major obstacles, there is hope for the future of agriculture, Azerbaijan's second - most important natural resource.

Private ownership of land ended when the Soviets took over Azerbaijan in 1920. Farmland was then organized into state-owned agricultural cooperatives, known as kolkhoz and sovkhoz. Soviet leaders mandated which crops would be grown and where those crops would be sent once they were harvested.
It soon became clear what tremendous potential Azerbaijan had for agriculture, specifically for growing fruits and vegetables.

Lankaran in particular was perfect for planting cabbages, tomatoes, eggplant and peppers. This region is located close to the southern border near Iran. "Lankaran was so productive that they called it 'The All-Union Garden,'" says Samad Garaisayev, chief expert for Cattle Breeding Management at Azerbaijan's Ministry of Agriculture.

Vegetables also became a specialty for kolkhozs and sovkhozs in Guba, Khachmaz and Masalli. In all, Azerbaijan sent 500,000 to 600,000 tons of vegetables each year to the All-Union Fund.
"None of the other republics sent as many vegetables to the Fund," says Sabir Valiyev, head of Cultivation Management at the Ministry of Agriculture. "Early in April, our cabbages were already being sold in Moscow and Leningrad, at a cheap price."

Left: Tea harvesting in the Lankaran region, which is fairly close to the Iranian border.

Some of the vegetables grown in Azerbaijan were canned before being sent on to other Soviet republics. These included pickled cucumber, tomato, cabbage and eggplant as well as various kinds of jams.
The cotton industry was also very important to Azerbaijan. In the 1970s and 1980s, the Republic produced about 1 million tons of cotton a year. However, since prices for cotton have gone down in the world market, today's production has decreased significantly.

Less Grain, More Wine
Grain production in Azerbaijan rose substantially during the Soviet period, reaching more than 1 million tons a year in the 1970s and 80s. Part of this increase had to do with productivity-the amount of grain harvested per acre more than tripled between 1913 and 1970.

Instead of developing the grain industry further, however, the Soviets decided to concentrate on Azerbaijan's wine industry. Grain growing was restricted. At the time, Azerbaijanis still had enough grain for themselves, since deficits were supplemented by the All-Union Fund.

One of the grains that was cut back was rice. Traditionally, rice had been grown for a long time in Azerbaijan, mostly in the southern regions of Masalli and Lankaran and also in Shaki, in the northern region of Azerbaijan in the foothills of the Caucasus mountains. The Soviet leaders reasoned that since plenty of rice was being grown in other republics of the USSR, there was no need to grow it in Azerbaijan.

In the 1970s, the Communist Party and the Cabinet of Ministers issued special decrees for developing Azerbaijan's agriculture, especially in terms of growing grapes for wine. Funds were allotted for new railroads and water pipelines, and 70,000 to 80,000 hectares of land were set aside for vineyards. The plan was for Azerbaijan to produce 3 million tons of grapes per year by 1990. By 1982 Azerbaijan was already producing 2.1 million tons of grapes, not so much by expanding its acreage, but by increasing productivity.

Planned Economy

Left: Selling melons out of the trunk of a car - a typical scene. In Lankaran. Photo: Blair

"During the Soviet period, we developed the branches of agriculture that Moscow considered necessary: cotton-growing, vine-growing, vegetable-growing," says Garaisayev. "But too few of those crops were kept in Azerbaijan. For instance, we sent cotton to Russia, which they used to process and produce cloth. Of course, it enabled them to take all the profit."

"Moscow always wanted Azerbaijan to be dependent," he continues, "in cattle breeding as well as in other things. Each year, Azerbaijan received an average of 1,200,000 tons of milk and dairy products and about 35,000-40,000 tons of meat and meat products from the All-Union Fund. We couldn't breed our own cattle because we weren't allowed to grow the proper feed for them. With the so-called 'planned economy' excuse, Moscow hampered our cattle breeding."

As a result, Azerbaijanis consumed much less meat and dairy products than people in other Soviet republics. For example, if an average person in the USSR ate 65 kg of meat each year, for an Azerbaijani it was closer to 37 kg.

After Azerbaijan gained its independence, Parliament adopted a new law facilitating the privatization of property in 1996. Farmland was apportioned as personal property. Of all the CIS countries, Azerbaijan has been the only one to use such a method. In Kazakhstan, Uzbekistan and other former Republics, the land is rented or leased for temporary use.

Tractors and other equipment were given to groups of farmers based on a property - share arrangement; for example, one tractor was designated for every 10 farmers. If a farmer doesn't have access to a tractor, they can contract with those who do.As of 1996, nearly all farm animals were divided among the private sector as well - 99.8% of the cattle and 98% of the sheep. The remaining cattle and sheep are held by the government for breeding purposes.

Above: The Soviet collective farm, known as a kolkhoz, found in the Ivanovka village in the Ismayilli region in central Azerbaijan. This kolkhoz is operated by Malakan Russians and during the Soviet period was a model project because of its high production. Photo: Litvin

For each crop, it's up to the farmers to sell their own produce, whether it's tomatoes, cucumbers, watermelon, berries or grapes. The prices are set by the market demand, not by the government. Farmers can sell their produce to other countries as well. Most of it goes to the Russian cities of Volgograd and Astrakhan, especially dates, tomatoes, cucumbers and watermelon. Hundreds of tons of persimmons are grown each year in Shaki, Zagatala, Ganja, Gazakh, Tovuz, Goychay and Aghdash.

Finding New Markets
Fruit ranks near the top of the list of Azerbaijani exports. Azerbaijan produces 400,000 to 450,000 tons of fruit a year. The region of Guba, for instance, is famous for its apples, especially a sweet red variety called "Jir Haji". When other kinds of apples were brought from abroad and grown in Azerbaijan, they weren't as attractive or as resistant to disease. Another local apple variety is called "Gizil Ahmad". This apple grows mostly in Gabala, Oghuz and Ismayilli, in the mountainous places.

Processed fruit also has potential. "Last year we participated in the Royal Agricultural Exhibition held each year in London," says Valiyev. "We took our jams and juice, such as fig jam, berry jam and walnut jam. Representatives from 70 countries participated in that exhibition. They were delighted with the taste of our jams."

Because the Soviets had placed so much emphasis on Azerbaijan's wine industry, it is still fairly viable. During the 1970s and 80s, Azerbaijani wines were sold in Moscow, Belarus, Estonia and the Baltic. Table wines such as "Giz Galasi", "Yeddi Gozal", "Gara Gila" and "Naznazi" are made from the "Madrasa" pink grape, exclusive to Azerbaijan and indigenous to Madrasa, a village in Shamakhi, a few hours north of Baku.

"We participate in many international tasting committees and international exhibitions," says Valiyev. "Lately our wines have been receiving numerous gold medals. This year our brandies won a gold medal at an International Tasting Convention held in the U.S. We also participated in an international exhibition held in Belgium. Five of our products won gold medals in an anonymous taste competition among 156 countries: our champagnes and 'Golden' vodka."

Left: The produce section of Ramstore, the first major supermarket to come to Baku in 1997. Photo: Blair


Crops that had been decreased during the Soviet period are gaining ground once again. "We currently import rice from Iran, Brazil and China," Valiyev says, "but now we are starting to plant rice in Azerbaijan again. If in 1999 we planted rice on 3,629 hectares, in 2000 we planted it on 4,437 hectares. We hope that in the future Azerbaijan will be self-sufficient in terms of its rice supply."

"After the collapse of the Soviet Union, we started growing more grain, but it's still not enough," says Garaisayev. "Azerbaijan currently produces 1.5 million tons of grain per year-all for its own use - but it needs 2.5 million tons. These days there is a tendency to replace vineyards with wheat fields."
Another crop that is making a comeback is sugar beets. "Azerbaijan used to grow sugar beets prior to the Soviet period," Valiyev says.

"But when the Ukraine started cultivating the crop, there was no longer any need to grow it, as they provided all of the USSR's sugar. After we gained our independence, we started planting sugar beets again in Nakhchivan, Beylagan, Sabirabad, Imishli and Salyan. Today Azerbaijan plants about 50,000 to 60,000 tons of sugar beets per year. But there are no sugar processing factories. The beets have to be sent to Iran (Ardabil), across the border from Bilasuvar (Azerbaijan). Iran processes the sugar beets and returns the product to us. That makes the sugar too expensive for our own consumers. We need to build our own factory in Azerbaijan."

One of the more profitable trends has been toward cattle farming. "You can see that now we have a lot of meat and dairy products," says Garaisayev. "This comes from the private production of our farmers. After privatization in 1996, cattle breeding increased. Now people make money from this industry."
Valiyev notes that the quality of dairy products has also improved. "Now our Azerbaijani companies are producing about 15 kinds of dairy products: yogurt, cheese, cottage cheese and milk. You can even see in the stores that our local dairy produce is outselling foreign products."

New Challenges
Privatization of factories is still a major hurdle in the development of agriculture in Azerbaijan. Production and processing are interdependent, Valiyev says. "Producers need someone who will buy all of their produce. They sell their produce in the market while it's still fresh. But what can they do with the rest of it before it spoils?"

Above: The persimmon is a major crop in Azerbaijan. Photo: Huseinzade

Presently, only a few factories have been privatized and are operating. Factories in Guba and Saatli produce small packages of juice and various kinds of jam. Another factory in Lankaran produces tomato paste. These three new factories export their produce to various countries, such as Japan, Russia, Belgium and Switzerland.

Tea processing factories also need to be privatized. Azerbaijan used to produce 34,000 tons of tea a year in the 1970s; last year, the harvest was only 1,900 tons. Part of the problem is that there aren't any tea processing factories operating. Now that the tea factories in Baku have been bought by a Turkish company, farmers are starting to grow tea again. The Azerbaijani tea is then mixed with other blends of tea from Turkey and India before being sold.

Azerbaijan has suffered immensely because of the Nagorno-Karabakh war. Today nearly 20 percent of our land is occupied by Armenians. A great deal of it was valuable farmland. For instance, in the Fuzuli region, we used to produce about 100,000 tons of grapes per year; Zangilan had three grape processing factories with 3,000 hectares cultivated in vineyards. Aghdam was known for its cotton, and Gubadli for its cattle. When Azerbaijanis fled from their homes in these occupied territories, they had to leave an estimated 145,000 cattle behind.

For many growers and producers, the problem is also a lack of cash-flow. "What troubles us most these days is that we don't have a credit-union system that allows farmers to borrow money," says Valiyev. "Our Ministry wants to establish these credit unions in every village. That way, when a landowner or a producer needs funds, he can borrow from the credit union and purchase what he needs. As soon as these credit unions are established, many of our problems will be solved."

Left: Rice production in Azerbaijan fell dramatically during the Soviet period, as rice was replaced by other crops.

If Azerbaijan can overcome these obstacles, prospects look good for the future of agriculture in the country. "Our climate and soil enable us to grow premium quality produce," says Valiyev. "Now that privatization has begun, we'll soon witness a rise in production."

"Now we are living in a transition period," says Garaisayev, "but we have great plans for the future. Agriculture has great potential in our country."

The Ministry of Agriculture provided the information for this article. Sabir Valiyev (left) , Director of Cultivation Management, and Samad Garaisayev (right), Chief Expert for Cattle Breeding Management, were both interviewed by AI Staff writer Arzu Aghayeva. Photo: Arzu Aghayeva.

Azerbaijan International (8.3) Autumn 2000.
© Azerbaijan International 2000. All rights reserved.

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