Edition #123, November 2022
Contents
State Initiatives ........................................................................................................... 2 1) Government to Subsidize Hazelnut Production 2 2) Next Year’s Budget to Support the Implementation of Agricultural Drones .................................. 2 Foreign Aid ................................................................................................................. 2 3) Sweden to Fund Food Safety Project under ENPARD IV Program 2 4) FAO Recaps ENPARD III Program, Announces Priorities for ENPARD IV Program
2 Private Sector.............................................................................................................. 3 5) Georgian Wheat and Flour Supplies Not Threatened by Russian Blockade 3 6) Honey Exports Hit New High ........................................................................................................... 3 7) Annual Inflation Rate in Georgia Hits 10.5% 3 8) Number of Cattle in Georgia Down 3.2% ........................................................................................ 3 9) Potato Prices on the Rise 3 10) Wheat and Flour Prices to Remain Unchanged ............................................................................... 3 11) 156,300 Tons of Grain Products Stored in Elevators in Q3 2022 4 12) Russian Flour Imports into Georgia Up Nearly 9 Times ................................................................... 4 13) Lack of Raw Milk in Georgia Threatens Dairy Sector 4 14) Lack of Eduction, Access to Technology Hindering Georgian Agriculture ....................................... 4 15) Share of Wine Exports to Russia Exceeds 60% 4
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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November 2nd, 2022, https://commersant.ge/en/post/georgian
Beka Salukvadze, the founder of Georgian Products Renaissance, is applauding the governments initiative to subsidize Georgian hazelnut production with GEL 20 million in total. Government subsidies are expected to increase the quality of nut produced through ensuring seedlings are properly cared for and the appropriate application of pesticides and fertilizers. The subsidies are also considered as important for the sector as, globally, nut prices are down.
November 18th, 2022, https://bm.ge/en/article/what-are-the-advantages-of-agro-drones deputy-minister/120916/ Deputy Agriculture Minister Giorgi Khanishvili recently appears on the television program “Business Morning” to discuss how GEL 200 million was included in next year’s budget for agricultural credits that support the further development of agriculture in Georgia. He specifically noted that this includes the procurement and implementation of agricultural drones, which are seen as an important modern technology that will help farmers increase both the quality and quantity of yields with minimal intrusion.
November 15th, 2022, https://www.fao.org/georgia/news/detail-events/en/c/1619062/
A new food safety project is being launched within the forthcoming ENPARD IV program of the Food and Agriculture Organization of the United Nations (FAO). The project, which will be financed by the Swedish Development Agency (SIDA), will focus on food safety, sanitary and phytosanitary measures and has a total budget of EUR 12.7 million. It is expected to significantly contribute to improving food safety and consumer protection as well as increasing the export of Georgian agricultural products to regional and global markets, with an emphasis on European Union (EU) markets.
November 21st, 2022, https://www.fao.org/georgia/news/detail-events/en/c/1619418/
The Food and Agriculture Organization of the United Nations (FAO) held a multi-stakeholder event showcasing the results of a EUR 12 million ENPARD III program, which was financed by the European Union (EU) and focused on connecting beneficiaries through business-to-business (B2B0 meetings. As a result of program activities, more than 250 B2B meeting were arranged, facilitating discussions for further cooperation and development. The program also supported the direct investment of USD 15 million in matching grants for the enhancement of the agricultural sector in Georgia. During the meeting, key priorities for the development of a sustainable agrifood system under the forthcoming UNPARD IV program were also discussed.
November 1st, 2022, https://ru.netgazeti.ge/44738/
Deputy Agriculture Minister Giorgi Khanishvili does not anticipate any issues with wheat and flour supplies in Georgia, even if Russia blocks Ukrainian grain from leaving ports in the Black Sea. On the contrary, Russia’s record-level harvest likely means that Georgia will be “flooded with an even greater flow and [at] many times cheaper”.
November 2nd, 2022, https://commersant.ge/en/post/in-10-months-honey-export-exceeded-the-2021-levels-by-20
Over the first ten months of 2022, Georgian honey exports exceeded 200 tons, 20% more than for all of 2021. 91% of this was exported to European Union (EU) countries. The top-five importing countries of Georgian honey were: Bulgaria (90,075 kilograms worth USD 255,950), France (76,200 kilograms worth USD 436,526), Norway (21,000 kilograms worth USD 103,111), Israel (10,234 kilograms worth USD 61,595) and Saudi Arabia (3,979 kilograms worth USD 14,995).
November 3rd, 2022, https://www.newsgeorgia.ge/infljacija
The annual rate of inflation in Georgia for October 2022 amounted to 10.5%. This includes an average month-on-month increase for food of 1.4%, including for vegetables (13.2%), dairy products and eggs (2.6%), sugar and sweets (2.1%) and coffee, tea and cocoa (1.4%).
November 16th, 2022, https://bizzone.info/agriculture/2022/1668644490.php
According to preliminary data, the number of cattle in Georgia in the third quarter of 2022 amounted to 933,00 heads, down 3.2% year-on-year. The number of pigs amounted to 202,400 heads, down 15.9% year-on-year. The number of chickens also saw a slight (0.3%) decrease, amounting to 10.6 million heads. Milk production was also down 6.3%, while meat production (5.8%) and egg production (3%) were both up.
November 16th, 2022, https://commersant.ge/en/post/potato-prices-are-increasing-in-georgia
Potato prices have increased in Georgia compared to 2021, with a kilogram of potatoes in stores costing approximately GEL 2.35. The reasons for this are a poor harvest as well as an increased production costs. Potato prices are not expected to drop anytime soon.
November 16th, 2022, https://bm.ge/en/article/wheat
Due to a record wheat harvest in Russia, wheat and flour prices are expected to remain unchanged through the end of this year. According to the most recent estimates, Russia is expected to export 50 million tons of wheat and flour.
November 17th, 2022, https://bm.ge/en/article/1563-thousand
In total, 156,300 tons of grain products (71.3% of which was wheat) were stored in elevators during the third quarter of 2022. This equates to an average daily storage capacity of approximately 43% for elevators in the country. During this same period, elevators sold 73,800 tons of products, 40.1% of which was their own production.
November 17th, 2022, https://bizzone.info/agriculture/2022/1668738813.php
In the first ten months of 2022, Georgia has increased its purchases of Russian flour by 8.9 times, helping Russia increase its overall flour and cereal exports during this same period by nearly three times compared to the same period last year. This is an indication that Georgia’s economic dependence on Russia has increased in 2022.
November 21st, 2022, https://commersant.ge/en/post/very-soon
Dairy product prices have been increasing in Georgia for several months due to a shortage of raw milk in the market. In fact, some are worried that the raw milk supply in Georgia may well evaporate completely in the near future. Supply issues with raw milk in the country began during the COVID-19 pandemic and seem to be worsening as feed prices for dairy cattle continue to rise. The end result of this is likely to be a further surge in prices for dairy products. In response to the situation, many experts are calling for the launch of a livestock program that will help dairy cattle farmers increase the quality and quantity of their production, resulting in a trickledown effect for dairy processors.
November 21st, 2022, https://bizzone.info/agriculture/2022/1669061879.php
The main issues facing Georgian farmers remain their relatively low level of education and their limited access to modern technologies. Both are important issues to address as the agricultural sector, globally, is becoming increasingly digital and adapted for modern technologies, meaning that Georgian agriculture risks becoming uncompetitive. Experts estimate that, if Georgia can make big investments in modern agricultural technology, prices for agricultural products could drop by 30–40%, making Georgian products much more competitive in key international markets. It will also result in production volume increases, meaning greater profits for Georgian producers. Of course, this also requires the requisite knowledge of how, when and where to use modern technological solutions.
November 23rd, 2022, https://bm.ge/en/article/the-share-of-wine-exports-to-russia-exceeded-60/121227/
Georgian wine exports increased 6.2% in October 2022 and amount to USD 201 million in value for the January–October 2022 period. USD 129 million of this was exported to Russia, up 21.6% from USD 106 million during the same period of 2021. Poland (USD 12.3 million) and China (USD 10.5 million) are the second- and third-largest export destinations for Georgian wine.
Prepared by Business & Finance Consulting (BFC) www.bfconsulting.com
Articles are taken directly from local sources without any fact-checking; they are provided as a convenience and for informational purposes only. Business & Finance Consulting (BFC)’s editing is limited to providing a short summary in English of the texts, highlighting the main points of the original articles. All rights reserved by the authors.
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