October 2021 | Agri Review
04 October 2021

The National Statistics Office of Georgia (GeoStat) recently published its economic review for Quarter II 2021. The publication highlights that agricultural production decreased by -2.3% in the second quarter of the year compared to the same period of 2020. Furthermore, agriculture contributed to 7.8% of the country’s total GDP during this period.

Trends in Foreign Direct Investments (FDI) do not look promising either. In the second quarter of 2021, FDI in agriculture decreased significantly by 73% compared to the same indicator in 2020. Moreover, FDI in agriculture was relatively low compared to the other sectors of the Georgian economy and accounted for 0.6% of total FDI.

2021 has been tough for grape growers. On August 26, hail and strong winds damaged 4,600 hectares of grapes in the Telavi and Gurjaani municipalities of the Kakheti region. Under “Rtveli 2021”, damaged Rkatsiteli grapes were accepted for 0.8 GEL in the Vintage Coordination Headquarters and damaged Saperavi grapes - for 1 GEL. According to the Ministry of Environmental Protection and Agriculture of Georgia, there will be one-time compensation of 3000 GEL to those farmers whose harvest was completely destroyed to recover their vineyards. Similarly to previous years, the Government of Georgia (GoG) is subsidizing the 2021 grape harvest again this year to help farmers and wine producers sell their products. From a total of 0.9 GEL per kg of Rkatsiteli or Kakhuri Mtsvane grapes, 0.35 GEL will be subsidized.

By 1 October, around 203.7 ths. tons of grapes were sold with a corresponding income for farmers of 237.8 mln. GEL. However, since Rtveli is not yet over, the final statistics on grape sales and their total income is not yet available.

As to prices, between June-August 2021, prices for food and non-alcoholic beverages, measured by the Food Price Index (FPI), also exhibited an upward trend. In August 2021, food prices increased by 1.4%, compared to July 2021; while the corresponding month-over-month price changes in June and July were 0.2% and 3.2%, respectively.