October 13, 2014 Kh-Index | Economic geography of cheese production: the case of telavi
13 October 2014

In September 2014, the cost of cooking one Imeretian khachapuri gained 3.2% relative to August, reaching 3.35 GEL. Importantly, Khachapuri Index added much more than 13.7% in annual terms, suggesting that Georgia is beginning to experience inflation, at least as far as food prices are concerned.

There is considerable variation in the level of the Khachapuri Index across Georgia's major cities. At 3.55 GEL, Tbilisi and Kutaisi currently top the list. Batumi is third at 3.30 GEL. Traditionally for this time of the year, Telavi lags far behind with 3.01 GEL (10 % below the national average).

There is a particular reason for Telavis's position at the bottom of the Index. A large chunk of cheese sold in Kakheti originates in the highlands of Tusheti. And it is typical for the Tushi shepherds to bring their cows and sheep back to the Alazani valley at the close of the summer season. The shepherds carry with them very significant quantities of cheese produced and stocked in the highlands during the summer. As long as these stocks last, they apply downward pressure on prices. Thus, in September, Imeruli cheese cost as little as 5.60GEL in Telavi while fetching anywhere between 7.3-8.5GEL in other Georgian cities.