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Unusually High Exports of Potatoes From Georgia

10.10.21 23:00

EastFruit analysts point to record high potato exports from Georgia at the end of September 2021, as neighboring countries try to fill the potato supply gap.
6.2 thousand tons of potatoes were exported from Georgia in September 2021. 83% of them were sent to Russia and Azerbaijan. Ukraine, Moldova, Armenia and Slovenia account for the remaining 17% of Georgia’s potato exports. The share of Russia in the total export volume was 45%.
Notably, there are significant price differences. Exporters to Russia were paid $430 per ton, which is 1.5 times more than the second highest price paid by Armenia ($280). In all other cases, the export price remained below $135 per ton.

Russian demand for potatoes from the latest harvest in Georgia is driven by the recent unfavorable situation in the Russian market. Heavy rains in Russia make it difficult for growers to harvest potatoes, and local supplies are very limited. Moreover, the average harvest has dropped significantly this year. All this leads to an increase in potato prices, as well as to the need for import to the Russian market. It looks like Russians expect prices to remain at the current level. If it comes true, this will attract more exports from Georgia, since the average price in Georgia is currently about 38% lower than in Russia.
This can lead to high prices for potatoes for Georgian consumers. 
Supplies that were previously targeted at the local market will be exported to Russia. The Georgian potato industry has already faced such circumstances, when Russia bought huge volumes of Georgian potatoes in the second quarter of this year. As a result, average prices for Georgian potatoes in July and August increased by 90% in dollar terms compared to the same period in 2020 and by 30% compared to 2019.
Slight price growth is now observed. According to EastFruit price monitoring data, from September 24 to October 1, the average price of Georgian potatoes increased from $0.29 to $0.32 per kilogram.
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