Duties Blamed for Slide in Kazakh Exports


The competitiveness of Kazakhstan lubricant makers against Russian counterparts suffered because of the high duties paid by the former to export products to neighboring countries, an official from one company told an industry meeting this month.

Hill Corp. is the largest domestic lubricant supplier and operates a 73,000 metric tons per year lubricant blending plant in Shymkent.

The company’s exports slumped in 2023. While in the first half of 2022 it exported 953 tons of finished products, the amount fell to only 71 tons for the same period of this year, Ulpan Kubelekova, the company’s deputy general director, told a meeting of the National Chamber of the Kazakh Entrepreneurs, according to local news reports, including an Aug. 8 article published by Vera.

Kubelekova appealed to the chamber to push harder with the state representatives for a review of current lubricant export duties. She compared current levels in Kazakhstan to more favorable conditions for Russian lube exporters.

“The occasional review and lowering of the customs fees in the neighboring country [Russia] makes a big difference for the competitiveness of our production,” she said, according to the Vera article.

Kubelekova said duties paid by Kazakhstan lubricant exporters are more than ten time larger than those paid by the Russian producers to ship lubes to Kazakhstan.

In January of this year, Russia reduced the duty on lubricant exports from U.S.13.30 per ton to $5/t. Kazakh suppliers pay an export duty of $60/t. Kubelekova said that in this situation the Kazakh producers are in an unfavorable position and cannot compete with the Russian plants.

The chamber sent a letter to the Ministry of trade of Kazakhstan demanding a review of the export rates at the level of $5/t of lubricants. Kazakh exporters are still waiting for feedback from the ministry, news outlet Vera reported.

Two large lubricant producers in Kazakhstan are Hill Corp. and Lukoil. In 2019 Lukoil opened a 100,000 t/y plant is in Almaty in the eastern part of the country. Both companies import base oils from Lukoil’s refineries in Perm and Volgograd, Russia. Both companies export lubricants to the region of Central Asia.

Kazakhstan consumes around 150,000 tons of finished lubricants annually, according to Hill.

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