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AGRICULTURE BULLETIN Dairy Producers Request State Support National Wine Agency Signs Cooperation Agreement with UK’s Swirl Wine Group EU, FAO Grants Spurring Investments in Georgian Agriculture More Than 1 Million Head of Cattle Registered in National Electronic System
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Georgian Agriculture Finance Bulletin Edition #114, February 2022
Contents State Initiatives ........................................................................................................... 2 1) 2) 3)
Dairy Producers Request State Support .......................................................................................... 2 National Wine Agency Signs Cooperation Agreement with UK’s Swirl Wine Group ...................... 2 Government Measures to Ensure Food Security as War Rages in Ukraine .................................... 2
Foreign Aid ................................................................................................................. 2 4) 5)
EU, FAO Grants Spurring Investments in Georgian Agriculture ...................................................... 2 Georgian Specialists Receive Training on Grapevine Monitoring and Control ............................... 3
Private Sector.............................................................................................................. 3 6) 7) 8) 9) 10) 11) 12) 13) 14) 15) 16) 17) 18) 19)
More Than 1 Million Head of Cattle Registered in National Electronic System .............................. 3 Georgian Agricultural Exports Reach USD 1.1 Billion ...................................................................... 3 Georgia Ranks 6th in Global Hazelnut Production ........................................................................... 3 Armenia the Largest Supplier of Table Grapes to Georgia .............................................................. 3 Chicken Meat Prices Rising Due to Increased Production Costs ..................................................... 4 Hazelnut Processor Agritrade Exported 700 Tons of Hazelnuts in 2021 ......................................... 4 Georgian Pecans to Reach Baltic Markets ....................................................................................... 4 Increased Productions Costs Are Leading to Bread Product Price Increases .................................. 4 Apple Exports on the Decline .......................................................................................................... 4 Wine Exports Up 51% ...................................................................................................................... 4 2021 Exports of Georgian Livestock Earn USD 59 Million in Revenue ............................................ 5 Nut Exports Exceed 19,000 Tons ..................................................................................................... 5 Georgia a Top-5 Blueberry Supplier to Russia in 2021 .................................................................... 5 Georgia Exported USD 11 Million in Spices in 2021 ........................................................................ 5
Note: The Georgian Agriculture Finance Bulletin presents a monthly roundup of headlines and news stories related to investments and financing flows to Georgia’s agricultural sector. This bulletin is prepared by Business & Finance Consulting—a Swiss-based development finance consulting company with a long history of working in Georgia. Currently, BFC is implementing the Agricultural Lending Programme for KfW. Read more »
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BFC. Georgian Agriculture Finance Bulletin. Edition #114, February 2022
State Initiatives 1)
Dairy Producers Request State Support
February 16th, 2022, https://bizzone.info/agriculture/2022/1645052199.php
Dairy companies are closing their doors one after another due to a shortage of raw materials and cited unfair competition. In response, those remaining are asking the state to introduce a mechanism to control and suppress black market activities. They are also asking the state to consider subsidizing the creation of breeding farms and launch educational campaigns in order to bolster productivity.
2)
National Wine Agency Signs Cooperation Agreement with UK’s Swirl Wine Group
February 22nd, 2022, https://commersant.ge/en/post/swirl-wine-group
A cooperation agreement between the National Wine Agency and British marketing company Swirl Wine Group has been signed by both parties. Under the terms of the agreement, Georgian wine tastingseminars will be held for wine professionals and representatives of the wine trade throughout the United Kingdom in 2022. Moreover, targeted advertising and media campaigns will also be conducted, and Georgian wine will be presented at international exhibitions. This is an important agreement for Georgia’s wine sector as the United Kingdom is one of the largest importers and consumers of wine in the world.
3)
Government Measures to Ensure Food Security as War Rages in Ukraine
February 28th, 2022, https://www.newsgeorgia.ge/%d0%
Against the backdrop of the war in Ukraine, Georgia has announced that it has 50,000 tons of wheat stocks in reserve as well as sufficient flour stocks to ensure food security in the country. Most wheat imports into Georgia come from either Russia or Ukraine. With both possibly limiting or banning exports as worldwide sanctions and the war take their effect, Georgian officials are also prepared to negotiate wheat imports from other sources. The government is also working with industry representatives to ensure that prices remain reasonable and accessible for consumers.
Foreign Aid 4)
EU, FAO Grants Spurring Investments in Georgian Agriculture
February 8th, 2022, https://www.fao.org/georgia/news/detail-events/en/c/1469369/
Over the past 2 years, the European Union (EU) and the Food and Agriculture Organization of the United Nations (FAO) have awarded approximately USD 5.1 million in matching grants to Georgian agricultural producers, which has helped increased the competitiveness of Georgia’s agricultural sector, create jobs and bolster food security. In addition to direct financing, grant funding is complemented with knowledgesharing initiatives (both practical and theoretical) designed to increase the quality and quantity of harvests while also reducing expense and negative impacts on the environment. The next round of grant mathcing is expected to be announced later in 2022, which available amounts expected to be between USD 1,000 and USD 150,000.
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BFC. Georgian Agriculture Finance Bulletin. Edition #114, February 2022
5)
Georgian Specialists Receive Training on Grapevine Monitoring and Control
February 22nd, 2022, https://www.fao.org/georgia/news/detail-events/en/c/1473208/
Georgian specialists from the State Laboratory of Agriculture and the Scientific Research Center of Agriculture have received training at several French agricultural science institutions on grapevine disease control and inspection, including the inspection and control of the quality of saplings. The goal of the trainings is to increase the capacity of Georgian authorities to support, monitor and control grapevines in Georgia, with the ultimate goal of boosting Georgian production and exports of grapevine products. The training, which was conducted by leading French researchers and experts, was organized by the European Union (EU) and Food and Agriculture Organization of the United Nations (FAO) under the EU Innovative Action for Private Sector Competitiveness in Georgia project.
Private Sector 6)
More Than 1 Million Head of Cattle Registered in National Electronic System
February 2nd, 2022, https://sputnik-georgia.ru/20220202/gruzinskaya
The National Food Agency is reporting that more than 1 million heads of cattle are now being monitored electronically within the country’s Electronic Identification and Registration System (NAITS) to help boost meat quality. The electronic system has data on both the origin of cattle, their movement, vaccinations, slaughter dates and the contact details owners. The National Food Agency is also planning to introduce special QR codes that will allow consumers to be able to learn the sex, age and slaughter date of the animal as well as the storage conditions and expiration date of any piece of meat.
7)
Georgian Agricultural Exports Reach USD 1.1 Billion
February 2nd, 2022, https://sputnik-georgia.ru/20220202/eksport
The export of agricultural products from Georgia reached USD 1.1 billion. This is largely due to increases in the export of alcoholic beverages, fresh fruits, fresh vegetables, mineral water, soft drinks and livestock. Compared to 10 years ago, agricultural exports have increased in value by 124%.
8)
Georgia Ranks 6th in Global Hazelnut Production
February 2nd, 2022, http://bizzone.info/agriculture/2022/1643840119.php
According to data of the Food and Agriculture Organization of the United Nations (FAO), Georgia accounted for 3% of global hazelnut production in 2020, which places it sixth in terms of largest hazelnut producers in the world. Just a few years ago, Georgia was a top-3 producer of hazelnuts globally; however, the spread of the Asian stink bug in 2016 has caused Georgia to drop in the global ranking. Although Georgia’s hazelnut industry has begun to rebound, it is still far from the level it used to be prior to the stink bug invasion.
9)
Armenia the Largest Supplier of Table Grapes to Georgia
February 4th, 2022, https://bm.ge/en/article/armenia-is-main-supplier-of-table-grapes-in-georgia/101094/
Table grapes are becoming increasing popular in Georgia, with Georgia importing 300 tons of them in January 2022 alone and over 2,000 tons in the last 12 months. This represents an 80% increase over the amounts imported just 9 years ago. By far, the largest supplier of table grapes to the Georgian market is Armenia, which provides 95% of all table grape imports into the country. With domestic demand growing, Page 3
BFC. Georgian Agriculture Finance Bulletin. Edition #114, February 2022
it is expected that some Georgian vineyards might start turning their attention to table grape production in the near future.
10) Chicken Meat Prices Rising Due to Increased Production Costs February 4th, 2022, https://commersant.ge/en/post/all-producers-rose-chicken-meat-prices
Prices for chicken meat are rising fast in Georgia, growing 11.9% year-on-year in 2021. Local producers have announced that this is due to price hikes in international processes as well as increases in the costs of raw materials used in the poultry industry. For example, the price of chicken feed has nearly doubled in one year’s time. As a result, all chicken producers in the country have been forced to increase chicken meat prices. It should be noted that prices for eggs has also risen for the same reasons.
11) Hazelnut Processor Agritrade Exported 700 Tons of Hazelnuts in 2021 February 5th, 2022, https://bm.ge/en/article/agritrade-exported-700-tons-of-nuts-in-2021/101146/
Agritrade, a hazelnut processing enterprise located in Kakheti, exported 700 tons of hazelnuts in 2021, mostly to China. The company, which bought more than 2,000 tons of hazelnuts and is still processing them, only exports its products to other markets.
12) Georgian Pecans to Reach Baltic Markets February 5th, 2022, https://bm.ge/en/article/georgian-pecan-hazelnuts-to-be-sold-on-the-baltic-market/101143/
Georgian Product Renaissance is planning to begin exports of pecans to Estonia, Latvia, Lithuania and Poland. Pecans, which are less popular in Georgia, have great export potential as they are commonly used in many confections elsewhere. For the moment, the company is planning to export 10 tons to the aforementioned countries.
13) Increased Productions Costs Are Leading to Bread Product Price Increases February 7th, 2022, https://commersant.ge/en/post/laris-strengthening-will-not-affect-bread-prices
Georgian grain and flour importers have announced that the recent strengthening of the Georgia lari has not had a significant impact on the cost of bread products. Rather, an increase in Russia’s export tax on wheat and increases in the prices of other raw materials and energy sources needed to produce bread (e.g. gas and electricity) have driven up bread product costs. It should be noted that Russia is Georgia’s largest supplier of grain and flour imports.
14) Apple Exports on the Decline February 7th, 2022, https://commersant.ge/en/post/georgia-exported-4-928-tons-of-apples
Between August 1, 2021 and February 6, 2022, Georgia exported 4,928 tons of apples worth USD 3.2 million. This represents a year-on-year decrease of 55% in terms of volume and 33% in terms of value. The decrease in apple exports is the result of a 49% increase in apple export prices.
15) Wine Exports Up 51% February 9th, 2022, https://georgiatoday.ge/georgian-wine-export-up-51-in-january-2022/
In January 2022, Georgia exported 5.3 million bottles of wine to 35 countries, generating USD 11.6 million in revenue. This represents a 51% year-on-year increase in terms of volume and a 43% year-on-year increase in terms of generated revenue. Page 4
BFC. Georgian Agriculture Finance Bulletin. Edition #114, February 2022
16) 2021 Exports of Georgian Livestock Earn USD 59 Million in Revenue February 10th, 2022, https://bm.ge/en/article/where-is-georgian-cattle-exported--top-exporting-companies/101512/
In 2021, Georgia exported 81,270 heads of cattle, earning USD 33 million in revenue. The top importing countries of Georgian cattle were Azerbaijan, Iraq and Egypt. Georgia also exported 254,675 head of smaller livestock (primarily pigs, sheep and goats), earning a total of USD 26 million in revenue. The top importing countries of smaller Georgian livestock were Saudi Arabia, Azerbaijan and Kuwait.
17) Nut Exports Exceed 19,000 Tons February 14th, 2022, http://bizzone.info/agriculture/2022/1644897063.php
Between August 1, 2021 and February 13, 2022, Georgia exported 19,700 tons of nuts, reaching a value of USD 90.4 million. This represents a 36% increase in terms of volume and a USD 7.4 million increase in terms of value. The top importers of Georgian nuts were Italy (8,175 tons), Germany (3,719 tons), Armenia (1,357 tons), Spain (638 tons) and the Czech Republic (504 tons).
18) Georgia a Top-5 Blueberry Supplier to Russia in 2021 February 15th, 2022, https://bm.ge/en/article/georgia-entered-the-top-5-largest-blueberry-suppliers-to-russia/101772/
Russia increased its blueberry imports by 21% in terms of volume in 2021, reaching 10,700 tons. In response, Georgian blueberry exports to Russia also increased by 37% in terms of volume, reaching 850 tons. This has resulted in Georgia now having an 8% share of Russia’s blueberry market.
19) Georgia Exported USD 11 Million in Spices in 2021 February 16th, 2022, https://bm.ge/en/article/georgia-earned-usd
In 2021, Georgia exported 4,997 tons of spices valued at USD 11.07 million. This represents a 0.8% decrease in terms of volume but a 0.3% increase in terms of value. The top markets to import Georgian spices were: Russia (1,730 tons, valued at USD 4.2 million), China (1,627 tons, valued at USD 3.1 million), Ukraine (574 tons, valued at USD 1.2 million), the United States of America (235 tons, valued at USD 1.1 million) and the Philippines (99 tons, valued at USD 206,500).
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