At the end of January, ISET’s Retail Food Price Index increased by 5.2% y/y (compared to January 2017). On a monthly basis (compared to December 2017), food prices in Tbilisi’s major supermarkets decreased slightly by 0.3%. According to data from the last two weeks of January, prices dropped the most for buckwheat (-6%), rice (-6%), and bananas (-2%). Among the sharpest price increases was an 8% rise in the price of wheat flour and tangerines, while milk and frozen chicken climbed 3%.
WORLD FOOD PRICES ON THE RISE
ISET’s Retail FPI ended a year on a high note: retail food prices picked up in December 2017, showed a significant rise of 10% year-on-year, and had the highest reading in three years (since the Index was launched in November 2014). After facing expensive Christmas dinners, Georgian consumers might be relieved as food inflation cooled to 5.2% in January 2018 (compared to January 2017).
International prices also exhibited an upward trend in 2017. The Food Price Index, measured by the Food and Agriculture Organization (FAO), showed a significant 8.2% hike in 2017, compared to the previous year. According to FAO, this was the highest annual average record since 2014. The main drivers were meat and dairy prices. In 2017, the FAO Meat Price Index gained 9% from 2016, while the FAO Dairy Price Index showed the sharpest increase at 31.5%. Reflecting international prices, meat and dairy products have become more expensive in Tbilisi’s retail supermarkets. Prices increased the most for beef (20% ↑), butter (17% ↑), cheese (16% ↑), and milk (7% ↑).
According to the World Bank, food prices are expected to increase further in 2018. This might be welcome news for producers and the food industry, but not so much for budget-conscious consumers.
Food Price Index Recent Publications
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JUNE 2021 | AGRI REVIEW
On 15 June 2021, the National Statistics Office of Georgia published its annual publication for the agricultural sector - Agriculture of Georgia 2020. According to the publication, agriculture, forestry, and fishing comprised 8.4% of GDP in 2020, higher than the 7.2% share in 2019, but in line with the general trend over the last five years (agricultural GDP comprising on average 7-8% of GDP). Agricultural GDP in nominal terms increased by 13% on an annual basis.… Read More
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MARCH 2021 | AGRI REVIEW
On 29 December 2020, the parliament of Georgia approved the state budget for 2021, which includes allocations of around 18.3 billion GEL. From which the Ministry of Environmental Protection and Agriculture (MEPA) will receive 451.6 million (2.5% of the total budget allocation). MEPA will direct 10 mln. GEL towards the Environmental Protection and Agriculture Development Program (2.2% of MEPA’s total budget), with around 389.6 mln. (86.3% of MEPA’s total budget) to be allocated to agricultural… Read More
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DECEMBER 2020 | AGRI REVIEW
The COVID-19 pandemic raised concerns about the food security of many countries, in particular import-dependent developing countries like Georgia. Trade restrictions imposed by Georgia’s trade partners tightened the supply of some cereals and vegetables, signalling the risk of an increase in food prices. While there is no formal evidence of food insecurity due to the pandemic, given that Georgia is a net importer of wheat the state subsidized wheat imports, and, according to Georgia’s Wheat… Read More
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OCTOBER 2020 | AGRI REVIEW
The National Statistics Office of Georgia (GeoStat) recently published its economic review for Quarter II 2020. The publication highlights that agricultural production increased by 4.7% in the second quarter of the year compared to the same period in 2019. Furthermore, agriculture contributed to 10.2% of the country’s total GDP during the same period. In the second quarter of 2020, Foreign Direct Investments (FDI) in agriculture also increased and were almost six times higher than the… Read More
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JUNE 2020 | AGRI REVIEW
On 15 June 2020, the National Statistics Office of Georgia published its annual publication for the agricultural sector - Agriculture of Georgia 2019. The publication shows that agriculture, forestry, and fishing comprised 7.2% of the nominal GDP in 2019, slightly lower than the 7.8% share in 2018, but in line with the general trend over the last five years (on average 7-8% of GDP). In nominal terms, the output of agriculture increased by 4% in 2019… Read More
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DECEMBER 2019 | AGRI REVIEW
On December 10, the parliament of Georgia approved the state budget for 2020. The budget includes allocations of around 14.4 billion GEL. Out of which, the Ministry of Environmental Protection and Agriculture (MEPA) will receive 353 mln. GEL (2.4% of the total budget allocation). MEPA will direct approximately 293 mln. GEL (2.0% of the total budget allocation) towards agricultural development and 60 mln. GEL (0.4%) will be spent on environmental protection. Compared to 2019, the… Read More
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OCTOBER 2019 | AGRI REVIEW
On 30 August 2019, a public hearing to discuss Georgia’s Rural and Agricultural Development Strategy for 2021-2027 was conducted at the Ministry of Environmental Protection and Agriculture (MEPA). The new strategy document represents a roadmap for Georgia’s rural and agricultural development for the next decade. The strategy outlines three major goals to be achieved by 2027: 1. Increasing the competitiveness of agricultural and non-agricultural sectors; 2. Sustainable management of natural resources, preservation of ecosystems, and… Read More
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