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The average price of cooking one Imeretian Khachapuri currently stands at 3.46 GEL, which is 0.9% lower month-on-month, and 3.2% higher year-to-year. While the Index is primarily affected by the price of Imeretian cheese (the most expensive Khachapuri ingredient), during much of 2015 some moderating influence on the Index has been exerted by flour.
Last month, the price of this strategically important product fell by 3% m/m, and by 6.3% y/y. To some extent, this change reflects external developments that are beyond Georgia’s control. This is so because Georgia heavily relies on the imports of both milled flour and raw wheat (which is milled locally).
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This week we use the Khachapuri Index to look at Georgia’s broader economic geography. We do so on the basis of price data for more than 100 products from each and every Georgian municipality, which were collected by the Georgian government with assistance from ISET and EU’s European Neighborhood Program for Agriculture and Rural Development (ENPARD).
We used this data for September to “cook” one standard portion of Imeretian Khachapuri for Georgia’s main regions. The map we produced shows how the Khachapuri Index increases from east to west. In Georgia’s eastern provinces the Index ranges from 2.88 GEL (in Samtskhe-Javakheti) to 3.14 GEL (in Mtskheta-Mtianeti). In the west, the Index only starts at 3.24 GEL (Imereti); it achieves its highest value in Adjara (3.61 GEL), marking an extension of a successful tourism season.
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The cost of cooking one standard portion of khachapuri fell to 3.46 GEL in September 2015, thus departing from the seasonal upward sloping trend. Compared to the previous month (August 2015) the Index declined by 0.9%, however in yearly terms (compared to September 2014, the Index gained 3.2%.
The main reason for the month-on-month decline in Khachapuri Index is very simple: it rose more than expected in August due to exceptionally strong tourism-related demand for Georgia’s traditional delicacies. As the number of tourists sharply declined in September, so did the Khachapuri Index.
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In August 2015, the average cost of cooking one standard Imeretian Khachapuri was 3.49 GEL, which is 11.4 % higher month-on-month (m/m, that is compared to the previous month), and 7% higher year-on-year (y/y, that is compared to the same month of last year).
For foreign currency earners Khachapuri became more expensive in m/m terms but cheaper in y/y terms, due to the depreciation of the Georgian currency against USD and Euro that took place in the last 12 months but not between mid-June and the end of July. When expressed in USD, the Khachapuri Index gained 8.4% m/m and lost -19.9% y/y.
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