LS Mtron Ltd., a South Korean company supplying tractors in over 40 countries, has signed an agreement with the Government of Uzbekistan to supply 24,570 specialized mini tractors for harvesting cotton over the next five years.
According to the agreement signed by LS Mtron and the Uzbek national enterprise Agromash Sanoat Invest LLC, the Korean firm will provide tractors worth US$ 500 million during 2014-18.
In addition to supplying tractors of six different models, the Korean company will also share manufacturing technologies in order to allow the Uzbek state-run agricultural machinery company to localize parts production for the tractors, the company said.
The agreement is in accordance with the previously announced plan of the Uzbek Government to mechanize cotton harvesting in the country. Uzbek authorities plan to mechanically harvest around 80-90 percent of cotton by 2016.
Since it embarked on the tractor business in 1977, LS Mtron has grown continually to become No. 1 in Korea in terms of tractor sales by 2012. The company opened a factory in China as well as a major sales office in the US last year, and a factory in Brazil this year.
Over the last few years, the Uzbek Government has been constantly criticized by the international community and various human rights organizations for forcing millions of ordinary citizens to work in cotton fields, including school-age children and students of colleges and universities. As a result, several Western companies have boycotted using Uzbek cotton.
This year, Uzbekistan has produced over 3.35 million tons of raw cotton, and processed cotton production is expected to be around 1.1 million tons, nearly the same quantity it produced last year, according to the Uzbek Cotton Industry Association (Uzkhlopkoprom).