2022 February-March Analysis

Fresh ideas, fruits and funding in Georgian agriculture

A number of hitherto unfamiliar but promising fruits are sprouting on Georgia’s agricultural scene, with upbeat predictions about export and revenue potential.

Grown in Imereti, Adjara, Samegrelo and Guria, blueberry exports have risen 48 percent to almost 1,000 tonnes last season.

Locally grown but unfamiliar fruits, nuts and vegetables are increasingly to be seen in Georgia’s shops and restaurants and winning a place on Georgia’s export list. More are on their way as farmers – encouraged by western advisers, government programmes and international market prices they find on the internet – see profits worth the risks.

Ironically, many of these crops have ancient local ancestry. Rejected by Soviet planners as fit only for wild foraging by the poor, Georgian blueberries, asparagus, almonds and pistachios were for long neglected. Weather and fashion have lately rehabilitated a number of Caucasian natives and new cultivated variants, hardier and producing fruit for mass production and long-distance travel, are attracting investors and overseas buyers.

Why is this happening now? A range of reasons are touched on in reports from local aid programmes and government initiatives (such as Plant the Future) in Georgian agriculture. The programmes are supported by the European Bank for Reconstruction & Development (EBRD), the UN Food & Agriculture Organisation (FAO) and EU4Business, and initiatives include EastFruit, the information and analytics platform.

Reasons include the opening up of new overseas market opportunities as global warming hits US, European and Asian harvests with its erratic weather, droughts and rising temperatures. Georgia’s improving supply chains mean produce can arrive in overseas markets in good condition and with days of shelf life left – there is growing availability of temperature-controlled storage and containers and technology for better packaging and processing. Georgian growers are adhering to EU and other international health and environmental regulations and can comply with western certification requirements.

The major banks are helping with their introduction of schemes to provide finance for expansion and start-up in agriculture. The best of them are those that accept as collateral the land plot of the project and give a grace period of years for profits from the plot to provide the repayment.

There is also the pay-off from the advice and support (financial and educational) from EU and US led government programmes that have targeted horticulture for years now. These, as listed on EastFruit’s website, are teaching modern growing methods, expanding greenhouse production and introducing new crops that can be sold into international as well as domestic markets.

Lastly but perhaps of most interest is the self-help coming from Georgian farmers in developing new distribution infrastructure, similar to that for grapes, with small producers who cannot afford sophisticated processing and export costs selling their produce to the large ones who can. Farmers, both large and small, are now cultivating new variants proven in overseas markets and known by international buyers.

Some producers are hedging their bets by exploring new opportunities for processed rather than fresh, with blackberry juice being one example and dried or frozen fruits another, or olive and other nut oils. Import substitution is another route and one taken at the Loladze farm in Lagodekhi, where for the last six years the farm has focused on production of exotic fruits – okra, pepino, physalis and black corn.

The big success, however – helped by health fashions (it is revered as an antioxidant), the government subsidies of seedlings, equipment and irrigation and access to the Russian market – has been blueberries.

Grown in Imereti, Adjara, Samegrelo and Guria, blueberry exports have risen 48 percent to almost 1,000 tonnes last season. This was despite a panic caused by new rules for access to Russia, which defying advisers and sales to the EU markets of Germany and Bulgaria dominates overwhelmingly. Forecasts are that exports will reach 5,000 tonnes within five years, says EastFruit.

Even at the start of 2020 there were 1,000 hectares of commercial blueberry plantations and EastFruit says that 200-300 hectares are added a year thanks to the subsidies and high levels of profitability. With the crop destined almost totally for export, the biggest inhibitors of future growth, says the FAO, could be capacity shortages for cooling, sorting and processing. Or, it adds, Russia market blockages as “Georgia will face a difficult problem of finding an alternative sales market.” Logistics to both the EU and the Middle East are “complex and costly”.

The FAO estimates that Georgia is on track to become one of the world’s largest producers as its blueberries are available at the end of May, fitting into an export niche after Spain’s harvests and before the Eastern European ones. Exports, according to EastFruit, rose $0.4 million to $5.6million last season.

“Blueberries are attracting more and more investments, both in production and technology improvements,” reports EastFruit. This trend is being encouraged by the Blueberry Council of Georgia, set up in 2020 by four of the major producers, Blue Valley LLC, Blueberry LLC, Agrolane LLC and FCO LLC, and , as well as Agritouch, the owner of a refrigeration facility for storing and freezing berries.

To support blueberry and other fruit and nut exports, state programs are helping producers meet the standards of Europe’s GlobalG.A.P on sustainability and the minimization of agro-chemical inputs. However, this is not easy for small farmers so as an entry stage, with the support of USAID, the Georgian Farmers’ Association (GFA) has developed a local standard – GeoGAP.

Much newer on the market is asparagus, both foraged and cultivated. It is found in the wild across most of the Eurasian continent, including Georgia, and has been wild-harvested for thousands of years for its medical rather than culinary uses. In Georgia it has now become an “economically important crop”, says EastFruit.

In the highlands of Samtskhe-Javakheti director and founder of Toki Agri Products, Tornike Mzhavanadze, has been growing both wild and cultivated asparagus varieties, supplying the Georgia market under the brand-name Green Republic. Wild asparagus is also being grown rather than just foraged from alpine areas, he told journalists.

Olives already have a recognised place in the world. While olives may not immediately be associated with Georgia, the International Olive Oil Council (IOC) says, they have been recorded in the country since the 1st and 2nd centuries AD, probably introduced by colonising Greeks. Of the 300 or so varieties known globally it says, around 10 per cent grow in Georgia

In current times Georgia has become so well established in the world of olives that an adviser to the Georgian Ministry of Agriculture and founder of the company Georgian Olive, George Svanidze, chaired the IOC in 2020 and 2021. There is a ten-year expansion plan for Georgia, helped by IOC grants for, among other things, the creation of an international laboratory to provide the level of certification necessary to boost exports.

Georgia has over 1,200 hectares in olive production, Svanidze told delegates at an IOC conference last December, and it “plans to expand its sector through ongoing investments and with the technical support of the IOC, the Georgian Government (under its Plant the Future plan) and the international community”. Work is also being done to revive the old varieties that grew so successfully in the past in Georgia – Tbilisuri, Akhasheni, Burko and others.

More and more attention is being paid to Georgian olive production, he told journalists early last year: “Big companies have begun to show more interest in breeding this crop. We have already signed cooperation agreements, for example with KTW (major wine company Kakheti Traditional Winemaking). It is about planting hundreds of hectares of oil plantations.”

Georgian Olive, which has grown with Turkish-Dutch investment, ranks top amidst Georgian olive companies. In its 12 years of existence it has planted well over a million seedlings from Turkey and Spain in the Signagi region and built a processing factory in Sakobo. Its production is organic and it has been selling both olives and at home, in Agrohub and Goodwill, and abroad.

Georgia has an ideal climate and ample water resources for growing almonds, walnuts, pistachios and hazelnuts. Although hazelnut production is well-established in Georgia, the country remains a net importer of walnuts, pistachios and almonds. Pistachios are one of the latest ancient revivals and the hope is that given their high world market price and wide popularity they will prove a good export. Trees still grow in the wild in the Vashlovani Nature Reserve and the area east of Signagi, but farmer numbers are rising, cultivated orchards now cover over 300 hectares, and there is already a Georgian Pistachio Association and a Georgian nursery providing local saplings.

In Georgia almonds are now becoming big business, with the Georgian Association of Almond & Walnut Producers forecasting that production will grow 16 times in the next seven years, although this may be held back by shortage of capacity for processing. According to EastFruit the first dedicated almond processing plant should open later this year.

In Georgia there is wide diversity in the species; historically much of the production was alpine and the harvest was heavily reliant on wild collection. The trees were also to be found in yards and study of almonds across the former USSR records that cultivation has been growing in recent decades, although according to FOA figures there were only 33,000 trees in Georgia in 2012. Now the Adjara Group alone (one of the country’s major new entrants into horticulture) has 2,000 hectares planted with 700,000 trees, according to its website.

Pecans are the latest nut to catch the attention of Georgian nut growers, and although there are as yet no major commercial plantations, EastFruit says they are already being exported to China and the EU. “According to growers’ forecasts, the current potential of Georgia is 150 tonnes of pecans per year,” said EastFruit.

It is the hazelnut importers who have decided to branch out into growing American pecan varieties. Initially these were planted for the durable quality of the wood but Georgian nut producers are seeking to diversify and the hope is that these nuts will bring profit margins superior to those on hazelnuts (a competitive market, especially from Turkey since the collapse of the lira).

Avocados are another new crop that is definitely in fashion – globally they are the fastest growing horticulture export, the FAO has been telling farmers in the region – and Georgia has not been left behind. EastFruit has reported the establishing last year of the first commercial plantation – planted on six hectares at Lanchkhuti in Guria by the Nutsge company, a long-established hazelnut grower.. It does not expect to enter full production for four or five years. All these new opportunities also bring new problems for the farmers, however. Overproduction is one spectre – raised by the Georgian Almond & Walnut Producers Association and by blueberry farmers – that is keeping on the pressure to build not just exports but more processing facilities to create finished products that will keep, be they juices, oils or preserves. Heavy dependence on the Russian market is another spectre raised constantly by government programmes encouraging diversification.

The depleted state of much of Georgia’s soil, the need for high quality fruits with long shelf lives, the demand for better packaging, marketing expertise and guaranteed financing. Wise advice from USAID agronomist Jorge Duarte to them is: “Gain knowledge before planting. Have the correct plan!”

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