georgian agro-food sector – for your investment · 2018-08-07 · the main hazelnut competitors...

1

Georgian Agro-foodSector – ForYour Investment

www.moa.gov.ge

CONTENTS

Hazelnut Production .............................................................................................................4

Apple Production ..................................................................................................................6

Blueberry Production ...........................................................................................................8

Cherry Production ............................................................................................................... 10

Mandarin Production .......................................................................................................... 12

Peach Production ................................................................................................................ 14

Persimmon Production ....................................................................................................... 16

Cucumber Production ......................................................................................................... 18

Tomato Production .............................................................................................................. 20

Onions Production .............................................................................................................. 22

Carrots Production ............................................................................................................. 24

Greens Production .............................................................................................................. 26

Potato Production ............................................................................................................... 28

Beef Production .................................................................................................................. 30

Pork Production .................................................................................................................. 32

Poultry Meat Production ..................................................................................................... 34

Freshwater Fish Production ............................................................................................... 36

Dairy Production ................................................................................................................. 38

Honey Production ................................................................................................................ 40

Tea Production .................................................................................................................... 42

Wheat Production ............................................................................................................... 44

4

Investment Opportunity of Hazelnut Production

Hazelnuts planted area has been increasing due to favorable climate and soil conditions. Georgia ranks among the top 5 hazelnut producing and exporting countries in the world. Approximately

39.7 tons of hazelnuts were harvested in 2013, reaching its record during the last five years. The increased hazelnut-planted area is mostly the result of the growing demand for high-quality raw materials on the European markets. Georgian hazelnut is ecologically pure and disease-persistent which makes it competitive on the European and International markets. The main hazelnut competitors of Georgia in the global market are Turkey, Italy and the USA.The main hazelnut producing regions are Samegrelo, Guria and Imereti.Hazelnut has a high economic value and it is one of the key agro export products in Georgia.

28 800 31 100 24 700

39 700

2010 2011 2012 2013

52%

23%

14%

11% Samegrelo

Guria

Imereti

Other Regions

YIELDS

Annual Production (tons) Production Regions

YIELD IN GEORGIA IN PERCENT OF YIELDS IN OTHER COUNTRIES

Azerbaijan Turkey USA EU

197% 191% 68% 169%

5

-

10,000

20,000

30,000

40,000

50,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2012 2013 2014

83 588

166 630 183 348

2012 2013 2014

20%

19%

8% 7%

46%

EExxppoorrtt MMaarrkkeettss -- 22001144

Italy

Germany

Kazakhstan

Spain

Other Countries

Production of saplings

Supply of farm inputs (agricultural chemicals,

fertilizers, etc.)

Supply of equipment and technologies

Supply of farm machinery, equipment and tools

OPPORTUNITIES

Supply of processing equipment and technologies

(de-husker, driers, etc.)

Production of hazelnut

Supply of storage services

Supply of de-husking and drying services

Supply of value adding services

MARKETS

Planting and Harvesting Periods

Months I II III VI V VI VII VIII IX X XI XII

Planting

Harvesting

Export Seasonality (1000 USD)

Major Export Countries

Annual Value of Exports (1000 USD)

FINANCIAL PERFORMANCE INDICATORS

Total Area (Orchard) 1 Ha

Initial Capital Investment 5 700 GEL

Payback Period 7th Year

IRR (8 Years) 19 %

6

Investment Opportunity of Apple Production

Georgia traditionally produced a wide variety of apple. Apple have historically been one of the main fruit crops that Georgia exported in the Soviet times.

The main apple growing area is Shida Katrli region. Shida Kartli has been the most renowned region for apple orchards and also apple processing takes place locally. Markets are supplied with local apples starting in September, however local summer varieties, in small quantities, are available earlier. Local apples are present on the market through February-March. Apple business starts from saplings production. Apple productivity per hectare is low because of production methods, irrigation and introduction of new sapling varieties. Georgian apple varieties, quality and packaging as well as existing storage and transportation infrastructure are the key chal-lenges for the agricultural sector.

21 100

64 300

45 000

68 600

2010 2011 2012 2013

64%

9%

6% 4%

17% Shida Kartli

Samegrelo

Imereti

Kvemo Kartli

Other Regions


YIELDS


Armenia Azerbaijan Turkey EU

33% 40% 21% 18%

7

Production of saplings Supply of farm inputs (agricultural chemicals, fertiliz-

ers, irrigation systems, etc.) Supply of equipment and technologies for environmen-

tally controlled storage infrastructure Supply of farm machinery, equipment and tools Supply of processing equipment and technologies

OPPORTUNITIES Supply of services of trucks with environmentally con-

trolled systems Production of apples Supply of storage services with environmentally con-

trolled systems Supply of value adding services (concentrate, juice, etc.) Manufacturing of packaging materials for primery and

value added products (boxes, jars, etc.)

MARKETS



Planting

Harvesting

Import Seasonality (1000 USD)

Major Export and Import Countries

Annual Value of Exports and Imports (1000 USD)

Retail Price Seasonality - 2014 (GEL/Kg)

29%

17% 45%

9%

Export Markets - 2014

Russia

Kazakhstan

Armenia

Azerbaijan

47%

26%

8%

8% 11%

Import Markets - 2014

Turkey

Netherlands

Iran

Greece

Other Countries

247 345 723

1 495

3 743

1 915

2012 2013 2014

Export Import





IRR (8 Years) 44 %

1.5

1.6

1.6

1.6

1.6

1.7

1.6 1.5

1.5

1.8

1.7

1.8


8

Investment Opportunity of Blueberry Production

Favorable climate and diverse soil is beneficial for blueberry production, especially in the western Georgia, where the soil is highly acidic, which is one of the key conditions for berry production.

Blueberry harvest period starts from June and lasts till August.

In Georgia blueberry suppliers mainly are wild blueberry suppliers, which is a factor that makes supply low and unstable. Wild berries have an organic quality since they are found in the forests of Georgia. Processing equipment is limited to blueberry producers.

YIELDS



28% 72% 17% 27%



fertilizers, irrigation systems, etc.)

Supply of equipment and technologies for envi-

ronmentally controlled storage infrastructure



OPPORTUNITIES

Supply of services of trucks with environmentally

controlled systems

Production of blueberry

Supply of storage services with environmentally

controlled systems


Manufacturing of packaging materials for pri-

mary and value added products (boxes, jars, etc.)

9

-

5.0

10.0

15.0

20.0

25.0

Jun Jul Aug Sep Oct

2014

2013

0 6

148

2012 2013 2014

92%

8%


Russia

Great Britain

MARKETS



Planting

Harvesting

Export Seasonality (tons)







IRR (7 Years) 32 %

10

Investment Opportunity of Cherry Production

3 000 2 700

5 100 5 600

2010 2011 2012 2013

57%

9%

7%

7%

20% Shida Kartli

Imereti

Kakheti

Kvemo Kartli

Other Regions

Annual production of cherries have been shown to be increasing over the period 2011-2013. Cher-ry production is mainly concentrated in Kakheti, Kvemo Kartli, Shida Kartli and Imereti regions.

Domestically produced cherries are available on the market from May till July.

Current productivity level is very low for this commodity as most production comes mainly from stan-dalone trees rather than established commercial orchards.


YIELDS



50% 84% 39% 84%

11

-

100.0

200.0

300.0

400.0

Jun Jul

2012 2013 2014

149

352 353

2012 2013 2014

70%

13%

15%

2%


Azerbaijan

Belarus

Russia

Armenia

2.43

3.19

JJuunn JJuull

Production of saplings Supply of farm inputs (agricultural chemicals,

fertilizers, etc.) Supply of equipment and technologies for envi-

ronmentally controlled storage infrastructure Supply of farm machinery, equipment and tools Supply of processing equipment and technologies

OPPORTUNITIES

Supply of services of trucks with environmentally controlled systems

Production of cherry Supply of storage services with environmentally

controlled systems Supply of value adding services Manufacturing of packaging materials for primery and

value added products (boxes, jars, etc.)

MARKETS



Planting

Harvesting


Major Export Countries Retail Price Seasonality - 2014 (GEL/Kg)


FINANCIAL PERFORMANCE INDICATORS Total Area (Orchard) 1 Ha



IRR (8 Years) 25 %

12

Investment Opportunity of Mandarin Production

Mandarin is one of the most important fruit for Georgian agrobusiness. The main mandarin pro-ducer regions are Adjara AR, Guria and Samegrelo.

Productivity of mandarins in Georgia is very low due to inappropriate agrotechnological activities.

The farming community in mandarin production districts is primarily made up of family farms.

Appropriate activities should be implemented to increase competitiveness and enhance the export potential.

77%

17%

5% 1% Adjara AR

Guria

Samegrelo

Imereti


Azerbaijan Turkey EU

15% 17% 22%

YIELDS


48 600 53 100 71 100

107 100

2010 2011 2012 2013

13

69%

23%

2% 2% 4% EExxppoorrtt MMaarrkkeettss -- 22001144

Russia

Ukraine

Uzbekistan

Belarus

Other Countries

96%

3% 1%

IImmppoorrtt MMaarrkkeettss -- 22001144

Turkey

Netherlands

Other Countries

1.2

1.5

1.7

2.0 1.4

1.2

JJaann FFeebb MMaarr OOcctt NNoovv DDeecc

24 118 507

7 322

18 320

12 986

2012 2013 2014

Import Export



fertilizers, etc.)





OPPORTUNITIES


controlled systems

Production of mandarin


controlled systems




MARKETS



Planting

Harvesting


Major Export and Import Countries Retail Price Seasonality - 2014 (GEL/Kg)


-

5,000

10,000

15,000

Jan Feb Oct Nov Dec

2012 2013 2014





IRR (8 Years) 11 %

14

Investment Opportunity of Peach Production

During last 15 years peach growing areas have been increased. Therefore, peach production has been raised significantly.

Most of peach orchards are located in Kahketi and Shida Kartli regions. The majority of produced peach is concentrated in small size orchards.

The market is supplied with local peaches from June till September. Peach varieties, quality and packaging, as well as existing storage and transportation infrastructure are the key challenges for development. Lack of appropriate infrastructure does not allow below grade peaches to be pro-cessed.

6 900

19 100

7 100

23 700

2010 2011 2012 201370%

21%

2% 2% 5%

Kakheti

Shida Kartli

Imereti

Samegrelo

Other Regions



41% 60% 23% 32%

YIELDS


15

8855%%

1122%%

33%% EExxppoorrtt MMaarrkkeettss -- 22001144

Russia

Kazakhstan

Other Countries

2.1

1.3

1.4 2.6

2.7

JJuunn JJuull AAuugg SSeepp OOcctt

-

500

1,000

1,500

Jun Jul Aug Sep

2012 2013 2014

662277 11 006666

22 552200

2012 2013 2014

Production of saplings Supply of farm inputs (agricultural chemicals,

fertilizers, irrigation systems, etc.) Supply of equipment and technologies for envi-

ronmentally controlled storage infrastructure Supply of farm machinery, equipment and tools Supply of processing equipment and technologies

OPPORTUNITIES Supply of services of trucks with environmentally

controlled systems Production of peach Supply of storage services with environmentally

controlled systems Supply of value adding services Manufacturing of packaging materials for pri-


MARKETS



Planting

Harvesting


Major Export Countries Retail Price Seasonality - 2014 (GEL/Kg)






IRR (8 Years) 24 %

16

Investment Opportunity of Persimmon Production

Georgia has its own sort of persimmon (Caucasian Diospyros lotus) which is adapted to Georgian conditions. Caucasian persimmon grows in the lower and higher mountain zones in Georgia.

Persimmon business starts from saplings production. The productivity per hectare is low in Georgia.

Persimmon harvest period starts from October and lasts till the end of November. Most production comes mainly from standalone trees rather than established orchards. Processing equipment is limited to persimmon producers.

5 190 5 266 6 781

3 159

2011 2012 2013 2014

Annual Production (tons)



fertilizers, etc.)





OPPORTUNITIES


controlled systems

Production of persimmon


controlled systems

Supply of value adding services (drying)


mary and value added products

17

-

500

1,000

1,500

2,000

2,500

3,000

Sep Oct Nov Dec

2012 2013 2014

22 779955

33 558855

11 991166

2012 2013 2014

47%

41%

4% 2% 6% EExxppoorrtt MMaarrkkeettss -- 22001144

Ukraine

Russia

Kazakhstan

Moldovia

Other Countries

MARKETS






Planting

Harvesting





IRR (8 Years) 12 %

18

Investment Opportunity of Cucumber Production

Georgia has an advantage in excellent nutritional characteristics and favorable climate for off-season production. The main production regions of cucumber are Kakheti, Kvemo Kartli and

Imereti.

Domestic cucumber supplies start in mid-May from Kakheti Region. Cucumbers from Kvemo Kartli are available from the end of May. Local cucumbers can be found on the market through the end of August. Small quantities of local cucumber supplies are also available in April and September.

During the off-season period, from January till May, there are high prices, because there is an insuf-ficient supply of locally produced cucumber.

28 600 25 500

38 700 31 500

2010 2011 2012 2013

10%

40% 40%

10% Imereti

Kakheti

Kvemo Kartli

Other Regions


YIELDS



19% 39% 21% 11%

19

-

500

1,000

1,500


2012 2013 2014

3 703 3 958 4 528

2012 2013 2014

98%

2% Import Markets - 2014

Turkey

Iran

3.2

3.4

3.4 2.9

1.4

1.2

1.1

1.2

1.2

1.8 2.4

2.8


Production of seedlings

Supply of production inputs (greenhouse struc-

tures, glazing materials, heating systems, agri-

culture chemicals, fertilizers, etc.)

Production of open-field and offseason cucumbers


OPPORTUNITIES






controlled system

MARKETS


Major Import Countries Retail Price Seasonality – 2014 (GEL/Kg)

Annual Value of Imports (1000 USD)

FINANCIAL PERFORMANCE INDICATORS Total Area (Greenhouse) 1 Ha

Initial Capital Investment 1 850 000 GEL


IRR (8 Years) 22 %

20

Investment Opportunity of Tomato Production

Georgia has an advantage in excellent nutritional characteristics and favorable climate for off-sea-son production. The main production regions of tomato are Kvemo Kartli, Shida Kartli, Kakheti

and Imereti.

Domestic tomatoes are available on markets from the end of June to the end of September or early October. Domestic supplies are also available during the off-season from greenhouse production but it is insignificant.

4% 4%

65%

25%

2%

Kakheti

Imereti

Kvemo Kartli

Shida Kartli

Other Regions

56 000 61 000 63 900 75 000

2010 2011 2012 2013


Yield in Georgia in Percent of Yields in Other Countries


32% 73% 37% 23%

YIELDS

21

3.4

3.0

3.1

3.2

2.6

1.6

1.3

1.3

1.3 2.3

2.9

3.0

Jan FFeebb MMaarr AApprr MMaayy Jun Jul AAuugg SSeepp OOcctt NNoovv DDeecc

80%

8%

6% 6%


Azerbaijan

Kazakhstan

Russia

Other Countries

99.7%

0.3%


Turkey

Other Countries

-

1,000

2,000

3,000

4,000

5,000


2012 2013 2014

6 835 9 588

11 744

332 833 585

2012 2013 2014

Import Export


Supply of production inputs (greenhouse structures, glazing materials, irrigation sys-tems, heating systems, agriculture chemi-cals, fertilizers, etc.)

Production of open-field and offseason to-matoes including industrial varieties

Supply of value adding services (tomato paste, etc.)

OPPORTUNITIES


Supply of processing equipment and tech-nologies

Manufacturing of packaging materials for primary and value added products (boxes, jars, etc.)

Supply of services of trucks with environ-mentally controlled systems

MARKETS




Financial Performance Indicators

Total Area (Greenhouse) 1 Ha


Payback Period 3rd Year

IRR (8 Years) 30 %

22

Investment Opportunity of Onions Production

Georgian farmers generally sell half of their production at harvest time and store the rest with the aim of obtaining higher selling price during the off-season.

Domestic production starts supplying the market at the end of June and supplies reach their peak during July-August. Small, insignificant volumes are stored for marketing later in the year and these are mostly red onions from Shida Kartli. During the off-season period, onion demand is met through imports which command 30% higher prices than during the period when the market is supplied with domestic production.

Quality of the stored onion is poor and losses are high due to poor local storage conditions. At pre-sent, there is a lack of modern, controlled enviroment storage facilities for onions which would en-sure high quality and provide for extended selling season.



39% 67% 32% 29%

YIELDS


23

Supply of production inputs (seeds, irrigation

systems, agriculture chemicals, fertilizers, etc.)

Production of onions


OPPORTUNITIES


controlled system

Supply of services of trucks

MARKETS

Seeding and Harvesting Periods


Seeding

Harvesting




-

500

1,000

1,500

2,000

2,500


2012 2013 2014


Total Area 1 Ha

Initial Capital Investment

(Land Price)5 000 GEL


IRR (8 Years) 27 %

24

Investment Opportunity of Carrots Production

5 500 8 500

2 900

9 900

2010 2011 2012 201370%

20%

10% Samtskhe-Javakheti

Kvemo Kartli

Other Regions

Carrots have been characterized with increasing production in 2013 compared with previous year. Key producing regions are Samtskhe-Javakheti and Kvemo Kartli.

Local carrots supply markets starting in mid-July from Kvemo Kartli. It is followed by produce from low-land Samstkhe-Javakheti in early September and from the high-land - Samtskhe-Javakheti - beginning in mid-September. Local carrots are available on the market through February.


YIELDS



16% 28% 18% 9%

25

-

100

200

300

400

500

600


2012 2013 2014

2 114

3 441

2 116

2012 2013 2014

84%

9%

4% 3% IImmppoorrtt MMaarrkkeettss -- 22001144

Turkey

Israel

Iran

Armenia

1.51

1.60

1.61

1.79

1.87

2.02

1.46

1.41

1.39

1.42

1.42

1.48

JJaann FFeebb MMaarr AApprr MMaayy JJuunn JJuull AAuugg SSeepp OOcctt NNoovv DDeecc


Supply of production inputs (irrigation systems,

agriculture chemicals, fertilizers, etc.)

Production in the open-field

OPPORTUNITIES



mary products

MARKETS



Seeding

Harvesting


Major Import Countries Retail Price Seasonality - 2014 (GEL/Kg)


FINANCIAL PERFORMANCE INDICATORS Total Area 1 Ha

Initial Capital Investment (Land Price) 5 000 GEL


IRR (8 Years) 26 %

26

Investment Opportunity of Greens Production

Fresh herbs industry has a long tradition in Georgia. Since the beginning of 20th century, fresh herbs have been intensively produced and exported from Georgia mainly to CIS countries. The

majority of the growers produce small amount of greens. It is possible to increase the production quantity.

The main greens’ manufacturer regions are Imereti (Tskaltubo, Samtredia) and Samegrelo (Zugdidi, Senaki). Imereti is an ideal place for production because of its climatic conditions. In Autumn-Win-ter-Spring period it is possible to produce greens in greenhouses without heating and thus reducing the production cost. Therefore, in the Imereti region there is favorable climate for off-season pro-duction.

The majority of the producers do not have the certificate – Global Gap and it hinders their export pos-sibilities in Europe.

9 100 11 400

10 100 12 700

2010 2011 2012 2013


27

-

500

1,000

1,500

2,000

2,500

Jan Feb Mar Apr May Oct Nov Dec

2012 2013 2014

5 127

6 883 6 565

283 192 229

2012 2013 2014

Export Import

51% 34%

7%

3% 5% EExxppoorrtt MMaarrkkeettss -- 22001144

Belarus

Ukraine

Kazakhstan

Lithuania

Other Countries

73%

9%

9% 8%

1% IImmppoorrtt MMaarrkkeettss -- 22001144

Armenia

Iran

Turkey

Netherlands

Luxemburg


Supply of production inputs (greenhouse struc-

ture, glazing materials, irrigation systems, agri-

culture chemicals, fertilizers, etc.)

Production of open-field and offseason


OPPORTUNITIES

Supply of services of storage with environmen-

tally controlled system


mary products


controlled system

MARKETS


Major Export and Import Countries Retail Price Seasonality – 2014 (GEL/0.1 Kg)



Total Area (Greenhouse) 1 Ha



IRR (8 Years) 18 %

28

Investment Opportunity of Potato Production

The main potato producer regions are: Samtskhe-Javakheti, Kvemo Kartli and Adjara AR.

Domestic markets are generally supplied with local early potatoes starting in mid-May from Kvemo Kartli region. Local normal potatoes are available on the market beginning in September. Domestically produced potatoes are generally presented on the market until the February-March period.

Potato productivity per hectare is very low and it is estimated as 11.3 tons/ha.

Good taste characteristics of Georgian potato play crucial role in growing demand in neighboring countries.

228 800 273 900 252 000

296 100

2010 2011 2012 2013

55% 31%

4% 10% Samtskhe-Javakheti

Kvemo Kartli

Adjara AR

Other Regions



53% 75% 36% 38%

YIELDS

Supply of seeds

Supply of production inputs (irrigation systems,

agriculture chemicals, fertilizers, etc.)

Production in the open-field

OPPORTUNITIES



controlled system


controlled system


29

6 571

1 867

7 032

97

3 455

894

2012 2013 2014

Import Export

58% 14%

14%

14%


Azerbaijan

Armenia

Kazakhstan

Other Countries

42%

14%

14%

14%

16%


Armenia

Ukraine

Egypt

Nehterlands

Other Countries

1.6

1.6

1.6

1.6

1.8

1.2 0.8

0.8

1.1 1.2

1.3

1.2


-

500

1,000

1,500

2,000

Jan Feb Mar Apr May Jun Jul Oct Nov Dec

2012 2013 2014

0

500

1000

1500

2000

2500


2012 2013 2014

MARKETS








Planting

Harvesting

FINANCIAL PERFORMANCE INDICATORS Total Area 1 Ha

Initial Capital Investment (Land Price) 5 000 GELPayback Period 3rd Year

IRR (8 Years) 40 %

Annual Consumption Per Capita (3 year average)

Annual potato consumption per capita is 52 kg

30

Investment Opportunity of Beef Production

The majority of farmers are small holders in Georgia. The main part of beef are fattened, slaugh-tered and sold by small farm holders on the open market in urban areas.

The predominant animals in Georgia are dual purpose breeds. Newly-born male calves are sold to local farmers for both breeding and fattening purposes.

The main beef producer regions are: Imereti, Kvemo Kartli, Samegrelo, Kakheti and Samtskhe-Ja-vakheti. Natural alpine pastures are available in some areas of Georgia.

The productivity of cattle is very low. Low productivity is caused by poor food base and breeding problem.

Beef self-sufficiency ratio is estimated as 71%. Despite the fact that the number of cattle has been increasing by years beef import still remains high.


YIELDS

Production Regions

18%

17%

15% 15%

35%

Imereti

Kvemo Kartli

Samegrelo

Kakheti

Other Regions

26 700 21 300

16 200 20 200

2010 2011 2012 2013

Source: GeoStat



69% 64% 28% 25%

31

Supply of artificial insemination services

Supply of embryo transplantation services

Supply of pharmaceutical services

Production of feed

Production of fodder crop

Beef cattle farming

Supply of slaughterhouse services

OPPORTUNITIES

MARKETS

Import Seasonality (1000 USD) Annual Value of Imports (1000 USD)

Major Import Countries

Annual Consumption Per Capita (3 year average)Annual beef consumption per capita is 6 kg

Retail Price Seasonality – 2014 (GEL/Kg)

12.3

12.2

12.3 12.9

12.9

12.7

12.8

12.7

12.8

12.8

12.9

12.9


-

500

1,000

1,500

2,000

2,500

3,000

3,500


2012 2013 2014

22 430

17 013 17 667

2012 2013 2014

47%

27%

13%

4% 9% Brazil

India

Germany

Ukraine

Other Countries

Import Markets - 2014


Supply of equipment and technologies for slaughterhouses

Supply of equipment and technologies for value adding

Manufacturing of packaging materials


Number of Cattles (Farm) 100 Heads



IRR (8 Years) 25 %

32

Investment Opportunity of Pork Production


Swine farming is a traditional sector of Georgian agriculture over the years. Pork has a high rate in food ratio of the country’s population. It means that the development of swine farming has

always been an important agricultural sector for Georgia.

The vast majority of swine in Georgia is held by small farm holders. So, there is a lack of big com-mercial pig farms in the country. There is a strong demand of pork for high quality domestic supply in Georgia.

The main swine manufacturer regions in Georgia are Imereti, Samegrelo, Kakheti and Kvemo Kartli. Georgian consumers choose pork dishes and seek a high quality domestic supply at a good price.

Pork self-sufficiency ratio is low by years and in 2013 it is estimated as 41%. Therefore, it means that country highly depends on pork import.


Armenia Azerbaijan EU

43% 67% 39%

12 800 11 600 11 800 14 900

2010 2011 2012 2013

23%

21%

20%

36% Samegrelo

Kakheti

Imereti

Other Regions

Production Regions

33






Supply of high productive breeds Supply of pharmaceutical services Production of feed Production of fodder crop Swine farming Supply of slaughterhouse services

Supply of value adding services Supply of equipment and technologies for

slaughterhouses Supply of equipment and technologies for

value adding Manufacturing of packaging materials

Annual pork consumption per capita is 7 kg

-

1,000

2,000

3,000

4,000

5,000

6,000


2012 2013 2014

28 813 33 994

38 210

2012 2013 2014

53%

9% 8%

6%

24%


Brazil

Canada

Germany

Spain

Other Countries

11.0

11.0

10.9

11.4

11.3

11.3 11.7

12.0 12.4

12.5

12.5

12.3


OPPORTUNITIES

MARKETS


Number of Pigs (Farm) 500 Heads



IRR (8 Years) 18 %

34

Investment Opportunity of Poultry Meat Production

Historically, poultry and egg industry was well developed and profitable in Georgia.

Key producer regions of poultry meat are Samegrelo, Imereti, Kvemo Kartli and Kakheti.

Local breeds of poultry have low-productivity, but distinctive taste characteristics. It is worth men-tioning that country’s population prefers local produced broiler to imported frozen meat.

Nowadays, poultry (broiler meat) production is mainly imported or supplied by the households. There is a lack of commercial farms specializing in poultry meat production in the country.

11 600 12 000 11 700

10 100

2010 2011 2012 2013

21%

19%

19%

13%

28% Samegrelo

Imereti

Kvemo Kartli

Kakheti

Other Regions




119% 105% 75% 79%

YIELDS

Production Regions

35

Annual poultry meat consumption per capita is 13 kg

6.3

6.3

6.3 6.4

6.6

6.4

6.3 6.5

6.7

6.7

6.4

6.2


20%

27%

20%

10%

23%


USA

Turkey

Ukraine

Brazil

Other Countries

-

2,000

4,000

6,000

8,000

10,000


2012 2013 2014

6699 884444

7711 442244 7711 992200

2012 2013 2014






Supply of pharmaceutical service

Production of feed


OPPORTUNITIES

Establishment of poultry farms

Supply of processing equipment (hatcheries, etc.)


MARKETS


Number of Poultry (Farm) 10 000 Heads



IRR (8 Years) 37 %

36

Investment Opportunity of Freshwater Fish Production

Georgia has abundant renewable water resources 63.3 cu km – 860 lakes, 45 reservoirs and ap-proximately 26 000 rivers.

There are 76-80 freshwater fish species in Georgia. The most valuable types of freshwater fish on the international and local markets are sturgeon and salmon. The most important freshwaters fishes are European catfish, zander, pike and pike perch in Georgia.

The main freshwater fish producer regions are Adjara, Imereti, Shida Kartli, Samtkhe - Javakheti and Kakheti.

- 1,000 2,000 3,000 4,000 5,000 6,000


2012 2013 2014

33 960 36 032 32 077

2 364 3 968

2012 2013 2014

Import Export

Fish feed production


Supply of fish hatcher services

Supply of processing equipment

OPPORTUNITIES

Fish farms



Frozen Fish Import Seasonality (1000 USD) Annual Value of Exports and Imports (1000 USD)

37

80%

18%

2%


Turkey

Armenia

Azerbaijan

24%

20%

18% 5%

7%

26%

IImmppoorrtt MMaarrkkeettss -- 22001144 Norway

USA

Spain

New Zealand

Canada

Other Countries

8.4

8.3

8.2

8.4 10.4

10.6 11.3

10.7

10.6 9.4

9.2

8.9




Total Area (Pool) 200 Tons



IRR (8 Years) 32 %

Retail Price Seasonality – 2014 (GEL/Kg)

38

Investment Opportunity of Dairy Production

Dairy products make a significant part of the Georgian daily menu. Fresh milk is mostly used for the small-scale production of “Sulguni” and “Imeruli” type white cheeses which are sold on local

markets.

Imereti region with 208 600 cattle population offers highest potential for milk collection and process-ing operations. Currently, there is 1 229 700 cattle population in Georgia.

Natural alpine pastures are available in some areas of Georgia.

Fresh dairy products are preferred by Georgian consumers, but they are currently in limited supply and poor quality.

The majority of farmers are small holders having 1 or 2 heads and the annual milk productivity of cattle (milkers) are very low.

Fresh milk supply is on a seasonal basis in Georgia. It is lacking on the market especially in the win-tertime while the majority of milk processing companies use imported milk powder.

588 582

590

605

2010 2011 2012 2013

21%

17%

15%

47%

Imereti

Kvemo Kartli

Samegrelo

Other Regions

YIELDS

Annual Production (million liters) Production Regions



51% 74% 34% 16%

39

Annual milk and milk products consumption per capita is 139 kg

2.4 2.5

2.4

2.4 2.2

2.2

2.2 2.4

2.5

2.5

2.4

2.5


-

500

1,000

1,500

2,000

2,500

3,000


2012 2013 2014

12 727

17 433 18 063

2012 2013 2014

37%

15% 11%

7%

30%


Ukraine

Lithuania

Iran

Belgium

Other Countries

Supply of artificial insemination services

Supply of embryo transplantation services


Production of feed


Dairy cattle farming

OPPORTUNITIES

Supply of milk collection services



Supply of equipment and technologies for value

adding


MARKETS


Major Import Countries of Milk Powder


Annual Value of Imports of Milk Powder (1000 USD)

Retail Price Seasonality of Milk – 2014 (GEL/Kg)

FINANCIAL PERFORMANCE INDICATORS Number of Cattle (Milkers) 100 Heads



IRR (8 Years) 24 %

40

Investment Opportunity of Honey Production

The distinctive taste characteristics and the high level of awareness on the local market are main strengths of Georgian honey industry.

Number of beehives has been increased in the country during last years and reached approximately 400 000 at the end of 2013.

The main producer regions are Samegrelo, Adjara AR and Kakheti.

In Georgia average honey productivity per beehive is low compared to other countries and it is esti-mated approximately 11-12 kg per beehive. Due to the fact that 100% of honey is entirely produced by households, the majority of the beekeepers work with the obsolete technologies and are not able to enhance productivity and reduce cost-price per kg honey.

Lack of modern technologies, together with small number of processing enterprises are the key challenges of Georgian honey industry. Georgian government plans to establish the internationally accredited laboratory for honey testing in 2015.

4 200

2 700

4 100 3 900

2010 2011 2012 2013

33%

15% 15%

37% Samegrelo

Adjara AR

Kakheti

Other Regions


41

87%

10%

1% 2% EExxppoorrtt MMaarrkkeettss -- 22001144

Saudi Arabia

China

Republic of Korea

Other Countries

62%

23%

4% 9%


Ukraine

Germany

France

Russia

Other Countries

15.1

15.2

15.4

15.3

15.2

15.2

15.1

15.2

15.4

15.4

15.3

15.4


-

20

40

60

80


2012 2013 2014

70 48

109

29

117

54

2012 2013 2014

Import Export

Manufacturing of beehives

Supply of beekeeping equipment, materials and tools



OPPORTUNITIES


Manufacturing of trailers

Supply of laboratory services

MARKETS



Retail Price Seasonality -2014 (GEL/Kg)



Number of Beehives 300



IRR (8 Years) 20 %

42

Investment Opportunity of Tea Production

The history of tea production in Georgia began in 1848 with the first plants being introduced into the Ozurgeti and Dadiani fields and the Botanical Gardens in Sokhumi. In 1900 Georgian tea won

quality recognition at the exhibition in Paris.

The main tea production regions are Guria, Samegrelo, Adjara AR and Imereti.

Georgia experiences the six-month season for the tea growing with good soil and climatic conditions. There is a large area of abandoned and forested land with tea plants that could be rehabilitated.

High quality and competitive price of raw materials are one of the major advantages of Georgian Tea. It is worth mentioning that the majority of exported tea are primary processing products and the majority of imported tea are packaged.

3 500 2 900 2 600

3 300

2010 2011 2012 2013

33%

55%

12% Adjara AR

Samegrelo

Guria



Azerbaijan Turkey EU India

79% 34% 29% 44%

YIELDS

43

28.0

29.2 31.1 28.5

29.7

29.7

30.3

30.8

30.4

30.0

30.3

30.1


5 815 7 039

8 573

2 458 2 251 2 329

2012 2013 2014

Import Export

12%

34%

18%

8%

28%


Mongolia

Turkey

Germany

Russia

Other Countries

4% 6%

20%

37%

33%


Turkey

Iran

Sri-Lanka

Azerbaijan

Other Countries

-

100

200

300

400

500


2012 2013 2014

-

500

1,000

1,500


2012 2013 2014


fertilizers, etc.)



OPPORTUNITIES


Production of tea

Supply of storage services


MARKETS




Retail Price Seasonality (tea leaves) - 2014 (GEL/Kg)




Planting

Harvesting


Total Area (Rehabilitation of Plantation) 1 Ha



IRR (8 Years) 26 %

44

Investment Opportunity of Wheat Production

Georgia is a net importer of wheat and it is the largest import commodity. Wheat self-sufficiency ratio is extremely low by years and in 2013 it was estimated as 12%. Therefore, it means that

Georgia highly depends on wheat import.

Wheat is mostly produced in the three following regions: Kakheti, Kvemo Kartli and Shida Kartli.

Domestic wheat is available on the market in July. By the end of July the wheat harvest is finished in Kakheti and Kvemo Kartli Regions, but in Shida Kartli and Samtskhe-Javakheti regions harvest ends in August. Locally produced wheat disappears quickly from the market due to a combination of factors including: low output, farmer cash flow needs and increased low priced imports shortly after domestic harvest. In Georgia wheat productivity per hectare is very low because of poor infrastruc-ture, lack of knowledge and low quality seed materials.


YIELDS

Production Regions

7744%%

1133%%

66%% 77%% Kakheti

Kvemo Kartli

Shida Kartli

Other Regions

48 400

96 800 80 700 81 000

2010 2011 2012 2013

Source: GeoStat



59% 69% 65% 33%

45

Supply of seeds

Production of wheat grain

Supply of production inputs (agriculture chemicals, fertilizers, etc.)

OPPORTUNITIES

MARKETS




Annual Consumption Per Capita (3 year average)Annual wheat consumption per capita is 110 kg


87%

12%


Russia

Kazakhstan

Other Countries

-

10,000

20,000

30,000

40,000


2012 2013 2014

897 587 654 420 566 827

174 396 150 017 39 801

2012 2013 2014

Import Export



Supply of services of grain elevators


Total Area 1 Ha

Initial Capital Investment (Land Price) 5 000 GEL


IRR (8 Years) 13 %


Seeding

Harvesting

georgian agro-food sector – for your investment · 2018-08-07 · the main hazelnut competitors...

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