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Georgia buys record-high volumes of walnuts despite the recent improvements in production

EastFruit analysts highlight unprecedentedly large volumes of walnut imports by Georgia in the last three months. Research points to increased local demand.

Fueled by state support, Georgia heavily invested in walnut production since 2015. According to the government’s “Plant the Future” program data, from 2015 to 2021, the total investment amounted to roughly $27 million. In the same timeframe, total annual production (including orchards established before the governmental program) averaged 5 600 tonnes in a year.

Notably, the outlook of production seems very hopeful. In the conference organized by the EastFruit project with FAO and EBRD, “Nuts of Ukraine 2022: exchange of experience with Georgia”, the Almond & Walnut Producer Association of Georgia presented their forecasts on the production volume of walnut orchards. The association, based on the statistics by the Ministry, expects the output of the walnut farms participating in the governmental program to reach an unprecedented level of 40 000 tonnes per year in 2025. The number is more than five times higher than the highest total country-wide production since 2014.

Read also: Exports of mandarins from Adjara (Georgia) have reduced by half – season summed up

Despite the high hopes for the future, current production still needs to cover local demand. From November 2022 to January 2023 Georgia imported 900 tonnes of walnuts, which is about 3 times more than the average imports in this period.

Imports in January 2023 are particularly abnormal. Through 2014-2022, the highest import volume recorded in January is 80 tonnes. This year, Georgia has imported 285 tonnes. Key walnut suppliers to Georgia are Ukraine, Kyrgyzstan, and Uzbekistan, with China slowly increasing its share in the Georgian market.

A survey of market participants in Georgia reveals that the local farmers have sold most of their products quickly this season. In most cases, they have very low or no stocks at all. The demand in Georgia is robust this season, which is inherently linked to the migration of Russian citizens. Particularly strong demand is coming from the supermarkets.

Unlike farmers, the processors and other participants that have bought walnuts locally still have some volumes left. Now there are some difficulties selling due to the competition with the imports. Prices for imported walnuts are much lower than those for local ones. Because of this, the increased demand has not translated into higher prices. Year-over-Year Georgian wholesale prices are practically unchanged.

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