Development of Agribusiness Enterprises - Asian Productivity ...

6. MONGOLIA
INTRODUCTION
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Enkhtuya Jigmiddorj
Marketing Manager
Devshil-Trade Co.
Ulaanbaatar
Agriculture is the main sector of the national economy of Mongolia. The agriculture
sector has two main subsectors; livestock, based on an essentially nomadic trans-human
system, and cereal crops, potatoes and other vegetables. The livestock sector produces an
estimated 88 percent of agricultural output and is characterized by movement over great
distances and poor communications, making both the provision of services and marketing
difficult. The cereal sector, which contributes the remaining 12 percent of gross agricultural
output, is far more organized. It is based exclusively on rainfed production of spring wheat
during the frost-free months of May to September from a potential arable area of 1.3 million
ha. The traditional occupation in Mongolia is animal husbandry.
Mongolia has a population of 2.3 million, of which 43 percent are working directly or
indirectly in agricultural production. The current land use is shown in Table 1. Natural
grassland comprises 78 percent of the total land area.
Table 1. Land Use in Mongolia, 1998.
Land Category Area (000 ha) Ratio (percent)
Agricultural land 129,132 79.6
Arable land 1,347 0.8
Natural pasture 127,785 78.8
Forest 14,400 8.9
Others 18,650 11.5
Total 162,182 100.00
AGRICULTURAL PRODUCTION
The land area in Mongolia suitable for agricultural production is large. According to
the statistical information on Mongolia about 16 percent of total production comes from the
agriculture sector. Before the 1960s Mongolia was a major cattle-breeding country. Since
the 1960s, land distribution was initiated by the government and farm crops and vegetables
are now extensively grown. The value-added of the agriculture sector is 35.7 percent of
Mongolian GDP.
Livestock Sector
Livestock production is the mainstay of the national economy of Mongolia. It
comprises two principal branches: extensive (pastoral) and intensive. About 95 percent of