AGRICULTURE BULLETIN All materials are published “as is” and are the property of their respective owners. 6,651 Preferential Loans Disbursed Under State BioproductionProgram Promotion Program Approved US to Support Wheat Production in Georgia Georgian Wine Exports Expected to Remain Stable #119 GEORGIA 07/2022
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 » BFC Max Högger Strasse 6 Phone: +41 44 784 22 22 info@bfconsulting.com CH 8048 Zurich, Switzerland Fax: +41 44 784 23 23 www.bfconsulting.com Georgian Agriculture Finance Bulletin Edition #119, July 2022 Contents State Initiatives ........................................................................................................... 2 1) 6,651 Preferential Loans Disbursed Under State Program 2 2) 188,000 Beneficiaries of State Program to Support Agricultural Landowners ............................... 2 3) Bioproduction Promotion Program Approved 2 4) Combines Sent to Help with Kakheti Wheat Harvest ...................................................................... 2 Foreign Aid ................................................................................................................. 2 5) Second Phase of NAITS Project Launched 2 6) US to Support Wheat Production in Georgia .................................................................................. 3 Private Sector.............................................................................................................. 3 7) Grape Imports Up in 2022 3 8) Georgian Wine Exports Expected to Remain Stable........................................................................ 3 9) Nut Production Forecast Ranks Georgia 7th Globally 3 10) Georgia’s Agricultural Potential High .............................................................................................. 3 11) Honey Exports Up 85.5% 4 12) Georgian Berries Struggle to Find Export Markets .......................................................................... 4
July 15th, 2022, https://agenda.ge/en/news/2022/2714
A total of 6,651 preferential loans for GEL 104.3 million have been issued for the production of annual crops under the state’s Preferential Agro Credit Program. Under the program, eligible beneficiaries can receive a 12 month loan of between GEL 5,000 and GEL 100,000 at an annual interest of up to 18%. The program covers 9% of the interest rate.
July 21st, 2022, https://agenda.ge/en/news/2022/2785
1) 6,651 Preferential Loans Disbursed Under State Program
BFC. Georgian Agriculture Finance Bulletin Edition #119, July 2022 Page 2
Foreign Aid
4) Combines Sent to Help with Kakheti Wheat Harvest
A total of 188,000 individuals and legal entities have benefited from the state program for the promotion of agricultural landowners. The program, which offers agricultural landowners subsidies of GEL 300 per hectare of land, is aimed at assisting agricultural producers purchase the goods needed for farm-related work. The program has a total budget of GEL 35 million.
The government has approved the Bioproduction Promotion Program, which aims to support beekeeping and winemaking in the country. Under the program, beekeepers and winemakers are eligible to receive up to 70% co financing support to help them increase the production of organic products. Co financing can be used for organic certification processes, consulting services, the purchase of biofertilizers and production materials and the cost of laboratory tests (for beekeepers).
5) Second Phase of NAITS Project Launched July 13th, 2022, https://www.fao.org/georgia/news/detail-events/en/c/1599336/
July 15th, 2022, https://agenda.ge/en/news/2022/2709
2) 188,000 Beneficiaries of State Program to Support Agricultural Landowners
3) Bioproduction Promotion Program Approved July 19th, 2022, https://agenda.ge/en/news/2022/2759
Approximately 80 combines owned by a state company have been tapped to help finish harvesting wheat in the Eastern Georgian region of Kakheti. They have joined forces with another approximately 30 privately-owned combines that were purchased through a state run co financing program to finish the harvesting work in the region. In general, the state is working to increase the numbers of agricultural machines in the country as part of an effort to bolster Georgia’s food security.
After the successful implementation of Georgia’s National Animal Identification and Traceability System (NAITS), the Food and Agriculture Organization of the United Nations (FAO) and the National Food Agency (NFA) have launched the second phase of the NAITS project. Whereas the first phase of the project focused on designing, building and implementing the electronic system, the second phase will concentrate on its sustainability and bringing it to more stakeholders. The long term goal of NAITS is to have a positive impact on public health, animal health, food safety and access to international markets.
State Initiatives
6) US to Support Wheat Production in Georgia
In the first five months of 2022, Georgia imported 1,576 tons of grapes worth USD 1.7 million. This is 267 tons and USD 0.3 million more than during the same period of 2021. The top five countries Georgia imported grapes from during this period were: Armenia (832.5 tons worth USD 674,500), Uzbekistan (487.6 tons worth USD 727,900), Iran (118.1 tons worth USD 181,900), the Netherlands (37.4 tons worth USD 112,400) and Turkey (92.3 tons worth USD 97,900).
8) Georgian Wine Exports Expected to Remain Stable July 4th, 2022, https://commersant.ge/en/post/georgian wine-export-will remain stable this year says national wine agency Levan Mekhuzla, chair of the National Wine Agency, is predicting that Georgian wine exports will remain stable this year. In particular, he stated that wine export volumes are expected to reach 2021 levels or, in the worst case scenario, be only slightly reduced. At the same time, he also noted that grape spirit exports are expected to fall dramatically as they have been historically targeted at Ukrainian and Russian markets. In the first five months of 2022, Georgia exported 27,141 tons of wine worth USD 79.8 million. This represents a 3.7% year on year decline.
The International Council for Nuts and Dried Fruits is forecasting that Georgia will produce 55,000 tons of nuts in the 2022 2023 season, ranking it seventh in the world in terms of the production of unshelled nuts. This places Georgia on par with Azerbaijan and Chile.
Georgian Agriculture Minister Otar Shamugia met with representatives of the US Department of Agriculture and the United States Agency for International Development (USAID) to discuss the continued development of Georgia’s agricultural sector. During these meetings, the US committed to helping Georgia increase its production of grain, particularly wheat, as part of an effort to increase the country’s self-sufficiency and food security. The first measure in this regard will be in depth research on the wheat production value chain in Georgia.
July 18th, 2022, https://agenda.ge/en/news/2022/2739
Private Sector 7) Grape Imports Up in 2022 July 4th, 2022, https://commersant.ge/en/post/from whom georgia buys grapes
9) Nut Production Forecast Ranks Georgia 7th Globally July 6th, 2022, https://bizzone.info/agriculture/2022/1657149422.php
10) Georgia’s Agricultural Potential High July 6th, 2022, https://commersant.ge/en/post/georgian farmer Irakli Chikava, vice president of the Georgian Agro Business Association (GABA), firmly believes that Georgia’s environment, especially its water resources, climate and market accesses, gives Georgia the potential to become a top agricultural producer in the world in terms of quality. To achieve this however, Georgia must work to increase the knowledge of modern agricultural techniques among producers as well as boost the usage of modern technologies in agricultural production cycles. Only then will Georgia be able to carve out niches as the global food market resets itself amid current supply challenges.
BFC. Georgian Agriculture Finance Bulletin Edition #119, July 2022 Page 3
berries are not-exported-abroad berry growers association
July 7th, 2022, https://commersant.ge/en/post/georgian honey In the first five months of 2022, Georgian honey exports increased 85.5%, amounting to 90.24 tons worth USD 340,400. The top three countries to import Georgian honey during this period were: Bulgaria (67.42 tons worth USD 195,100), France (14.40 tons worth USD 80,940) and Israel (3.57 tons worth USD 19,660). Smaller amounts were also exported to Germany, Japan, Saudi Arabia and the United Arab Emirates.
July 11th, 2022, https://commersant.ge/en/post/georgian
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11) Honey Exports Up 85.5%
12) Georgian Berries Struggle to Find Export Markets
Despite a good harvest year and strong prices in local markets, Georgian berries are struggling to find their way to export markets. In previous years, Russia was the main export market for Georgian berries; however, there are now problems with money transfers from Russia as well as a decreased demand from Russian markets. Georgian berry exporters are looking for other export markets but have, so far, found little success in this regard.
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