Vintage 2013 - Successful and State-free
17 October, 2013
Vintage 2013 - Successful and State-free
Vintage 2013 is reaching its end and all involved sides - vine-growers, wine companies and the state - have already acknowledged in one voice that, unlike previous years, the vintage was successful, well-organized and free of the state interference.
Grape harvesting is almost over in Georgia except small highland areas in the western part of the country. Levan Davitashvili, Head of National Wine Agency, an affiliate of Agriculture Ministry of Georgia, together with
the Agriculture Minister Shalva Pipia summed up the vintage results on 11 October, 2013. The Vintage 2013 turned out to be an unprecedented event, bringing both the state and private sectors to a common denominator and satisfaction unlike previous years that resulted in discontent and frustration. Since the Russian market was closed in 2006 to Georgian wine and agricultural products, demand on grapes and wine plummeted and vine growers faced problems of selling their harvest each year. As a result, a part of harvested grapes perished and some farmers cut down their vineyards in desperation. To dissolve the conundrum, the previous Government resorted to artificial remedies like excessive state interference in the market, artificially inflated prices, and discrimination of small market players as the harvest of big farmers were privileged at grape collection units of wine producing companies. This caused long queues, low quality and underpayment. In addition, the state was cracking down on even non-profile businesses to purchase grapes during vintage periods. In a word, instead of joy the vintage meant headache and unreasonable expenses to the companies.
This year, the new authorities promised to change things dramatically: treat the big and petty farmers equally, fix transparent market price and curb the state interference. And to a big surprise of everyone, administration did keep the promise. The vintage was exceptionally well-organized, free of queues and pressure on companies.
“This year vintage was just impeccable. I am positively overwhelmed how transparently and organized it has passed. And what is most important and has always been neglected, condition of grape ripeness was strongly observed, and appellations precisely defined. Now I can say for sure that the content in the wine bottle will be responding to the label description that was somehow ignored previously, unfortunately,” Shalva Khetsuriani, President of Georgian Sommeliers Association and owner of Khetsuriani Cellar, said to Georgian Journal.
Although the harvest was brimming this year the price was kept exceptionally high, fluctuating between GEL 1-2 per kilo [depending on the sort of grape]. Khetsuriani believes one of the major factors was reopening the Russian market this summer that boosted the demand. On the other hand, the key role was assigned to the shrewdly elaborated subsidizing system of co-financing the wholesale price for wine producing plants instead of previous practice of pinning subsidies to vouchers delivered to vine-growers directly. Moreover, the state offered preferential 15-month agro-credits to wine producing companies at 12% of interest while the state co-finances 9% of this rate. To prevent long queues, local authorities implemented registration of bulk sales. As a result, vine-growers in Kakheti alone witnessed GEL 100 million income and 38 loans accruing to GEL 43.6 million totally were disbursed through preferential credits to enterprises. An average bulk sale figures per family stood at five tons of grapes and GEL seven thousand was the average payment. Around 17 thousand families realized bulk sales and enjoyed profit, Pipia said, adding that this year the state granted full discretion to companies and farmers. In consequence, 84 companies processed a record amount 88,742 tons of grapes compared to 52 thousand of past year whereas the share of the grapes processed by the state companies made just 17% against the 65% of 2012. The remainder 83% went to private sector.
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