Harvest Stumbles over Storage Problems
12 September, 2013
Harvest Stumbles over Storage Problems
Georgian agriculture expects almost doubled harvest this year in spite of natural disasters affecting most of the country. Still the government however cannot make even a tentative prognosis of how much the local production may reduce the overwhelming import that makes up to 80% of the Georgian market.
To alleviate the persevering import problem in the country by boosting local production, Georgian government has undertaken an agricultural project in support of farmers and entrepreneurs involved in the agricultural sector (including
storage and processing). The support consisted in the financing of spring works as well as ensuring the steady supply of preferential credits. As a result, the amount of cultivated land plots increased by over 70 thousand hectares (ha) this year. By preliminary data, the corn harvest, including the most demanded wheat and maize, as well as potato is expected to double, Ministry of Agriculture of Georgia informed Georgian Journal. Moreover, production capacity of all kinds of agricultural products per hectare such as potato, cucumber, tomato, unions, carrots, etc are expected to enhance significantly. Harvest of grapes, citrus and fruits is forecasted to enhance by 20% compared to past year. However, how successfully the harvested product will be sold and stored still persists as an endemic problem of Georgian agricultural entrepreneurs. Low quality of products, low marketing skills of Georgian farmers plus the lack of fridge storehouse network obstructs the locally produced harvest from the market and makes the country import-dependent.
“There are 34 fridge storehouses throughout Georgia with total a 95 thousand tons of storage capacity; however, 80% of it is unused due to miscommunication between producers and storage owners, the transportation and very low product quality problems due to low technological and farming skills of farmers,” MOA explains.
According to MOA, storage facilities are beyond the reach of farmers, as their use dictates high transportation costs. Besides, storage cost stands at GEL 35 per ton while the refrigerator facilities do not assume responsibilities if the stored product perishes. The entire risk goes to producers. As a matter of fact, the product can be stored only if it is of high quality and has gone through all required technological methods, whereas farmers have no idea how skillfully they handled the product and how perishable it can be in the refrigerator. An alternative could be if the storage facility owners purchased the product from producers in bulk. This option however is tied to the quality-and-volume problem. Storage is profitable business only if it works at high capacity. The storage capacity starts from at least 1 thousand ton. One producer cannot provide even 100 tons of decent quality produce fit for the storage. Therefore, to escape risks and cut down on transportation and storage costs, producers prefer to store their goods at home as possible. This leads to inevitable wastes while 40% of the storage capacity remains unused throughout the country.
As a result, gardeners in the hail-ridden Kakheti region who enjoyed a remarkably high peach harvest this year, simply threw away thousands of tons of the defective peach that could have been processed into jams and juices should there have been nearby processing plants. The same pitiful scenario looms for citrus fruits. The sector pundits say the way-out is the development of processing industry. There were 400 processing plants in Georgia during the Soviet time, of which only 14 are operational today. The MOA’s agricultural development project aims to enhance this number to at least 60 this year, so that each plant operates in each district. 30 start-up processing plants are already financed in the project. They however become operational next year, i.e. this year farmers still face old problems.
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