November 2021 | Annual inflation reaches 19% in the khachapuri index
03 December 2021

In November 2021, the Khachapuri Index continued its upward trend and reached 5.37 GEL. This figure is 7.2% higher than the previous month (October 2021) and 19% higher than November 2020 (YoY). Every ingredient contributed to the YoY Khachapuri Index inflation: eggs (38.6%), flour (30.2%), butter (22.6%), yeast (18.7%), cheese (14%), and milk (10.3%).  

The prices rose for internationally traded commodities (butter and yeast), and for those produced locally using imported intermediate inputs. Additionally, increased international food prices contributed notably to inflation. The FAO has also reported on the rising food prices in November 2021, which were 27.3% above the level in the same period last year.

The core contributor to inflation was dairy and dairy products. At this time of the year, there is a seasonal decline in the supply of fresh milk, resulting in higher demand for imported milk powder, which is used as a substitute for fresh products. According to the FAO Food Price Index, the Dairy Price Index shot up by 19.1% compared to the previous November. This factor, of course, also contributed to higher dairy product prices in Georgia.