Goffer May Boost Georgian Agricultural Export
07 June, 2012
Goffer May Boost Georgian Agricultural Export

Local paper packaging industry is estimated as a potential to supplant import at local market and boost agricultural export. Georgian paper and packaging industry has full potential to develop and take the local market by supplanting the 80% of import infesting the market at the moment.  The import figure bespeaks of the market demand that promises to be increasing along with industrial development for the industrial development level is very low in Georgia. Agriculture, acknowledged as the top consumer of

goffer packaging in both developed and developing countries globe over makes just 3% of Georgian goffer consumption and rears up the list of about 17 sectors consuming goffer in the country at the moment. The reason is Georgian agriculture producers and exporters are not aware of goffer amenities.

Georgian agriculture producers and exporters still largely use wooden crates on transportation/logistics purpose thus bringing impact on the environment, product quality and their own profit all alike. A very simple recipe to solve all these problems plus boost all the industrial sectors of Georgian economy including the flabby agriculture export is developing local paper production and packaging, the USAID supported Economic Prosperity Initiative (EPI) believes.
The goffered packaging is cheaper and more profitable from both direct and indirect points of view. According to Giorgi Gorgishvili, Financial Director of Legi - Georgian paper packaging company covering about 90% in Georgian fruit and vegetable packing market made of eight local market players, price of goffer  package is by 20-30% cheaper than of crates but that is not even half of goffer priority. The most attractive side of the paper packaging is its weight that eases logistic and increases profits.
“Direct packaging has an insignificant share in the self –price in fact, the better privilege is weight,” he said. “Paper boxes are much lighter from logistics point of view, for exporters as you know limits are fixed for crossing borders and products are transported through 22-ton trucks, and thanks to lighter weight of paper boxes exporters can export 1.5 tons more product than by crates.”
The rap sheet of crates is as long as goffer privileges. According to Davit Charkviani, Packaging Sector Manager at EPI, the perishing coefficient of fruit and vegetable packed in crates is much higher than in goffer for wood includes bacteria causing perishing that affect profit at both export and local markets. Perish coefficient of mandarins in crates average to even 50% for example while bacteria-free goffer packages insure bigger volumes of product to get the place of destination unaffected.
Moreover, products easily loose shape in crates that makes them less attractive to consumers and they are sold at lower price in spite of excellent taste and organic consistence, while goffer packages in line with international standards provide a wide range of boxes tailored on different sorts of product to save their shape and image thus pushing the price and profit up ultimately.
According to EPI experts, paper and packaging development in the country in line with the EU standards may give a wide range of priorities to Georgian agriculture producers and exporters: it lays ground to branding that increases exported product quality and value as well as entire competitive image of Georgia, jacks the product up in the premium price segment and brings bigger profits. 
Products exported in crates do not provide any information of the product they contain except that they are Georgian that also undermines competitive power of Georgian export for Georgian product is not familiar beyond the Commonwealth of Independent States (CIS) been traditional market to Georgia due to common soviet past. Moreover, almost in all countries including CIS space the law forbids product transportation in crates that automatically pushes crated Georgian product down to low price segment of agriculture markets for high price segment made of supermarkets chain [that are more developed than markets in many countries] cannot handle with non-standard crates.
“Let’s take Ukraine where Georgian mandarin is sold at markets and no other information that salesman’s stamen that it is Georgian is available. Consumers are quite satisfied by taste but because the product is not offered in due package the price is lower than Turkish mandarins for example packaged in standards. Turkish mandarin cost last year was USD 1.20 per kilo while Georgian was sold for 80 cents. On the other hand our export cannot be sold at supermarkets even if they want to for they cannot handle with logistics of even non-standard size paper boxes let alone crates. So due packages gives an opportunity to increase profit margin,” Charkviani elaborated.
Packaging may boost competition among Georgian exporters. A logo explaining that the product is Georgian and of certain company is put on the paper box that gives an impetus to exporting companies increase quality to be competitive against their Georgian competitors for consumer has a chance to differentiate the product that will bring to a positive image of Georgian product at export markets all in all, Charkviani believes. 
To give an impetus to export, EPI helped local goffer producers to adopt a special technology that process packages by solution that makes boxes resistant to humidity and allows transporting of products vulnerable to damp been hard to export  as of yet. Legi plans to start producing such packages starting this summer and enhance productive capacity by fall.
And the last but not the least discomfort of the wooden crates is they cannot be reprocessed for secondary use; they remain at export market useless, while goffer packages can be reprocessed 8 times and only small quantities [around 20%] of cellulose [material made of fresh timber that is the constituent part of paper] is added during reprocessing that makes goffer in line with green industry. The bigger profit agriculture producers and exporters will enjoy from goffer packaging will be reflected in enhanced producing capacity and better quality, Charkviani presumes.
Once the big export companies adopt goffer packaging petty farmers providing local market and reluctant to changes are also supposed to be convinced in privileges of paper packaging and give up crating practice thus sparing forests and own expenses.
“The reason they still stick to crates is timber was cheaper thanks to free cut out practice, government officially prohibited free cut out past year, it cannot be that wooden box could be cheaper than the paper one,” Gorgishvili said. By today price of crates is higher than the paper ones fixing GEL 3 and GEL 2 per box respectively.

 

Print
Other Stories
Georgian business associations establish Georgian Tourism Industry Alliance
Business associations representing various sector of the hospitality industry in Georgia agreed to establish Georgian Tourism Industry Alliance (GTIA).
IMF approves $200 million for Georgia
The Executive Board of the International Monetary Fund has approved US$200 million financing to Georgia to address the effects of the COVID19 pandemic.
Georgia will be one of the first to open tourist corridors, Economy minister vows
Georgia’s Minister of Economy and Sustainable Development Natia Turnava pledged that Georgia would be one of the first countries to open safe tourist corridors with other countries.
Georgia’s GDP may contract 4%, the worst in the region amid pandemic
International Monetary Fund forecasts a 4% contraction of Georgia’s economy, which very much depends on tourism and money transfers.
Georgian retailers fight for survival as coronavirus pandemic continues
Pandemic has affected everyone worldwide, but one of the most vulnerable are retailers, those who depend on consumers and their spending.
Georgia remains the fifth in terms of budget transparency
According to the 2019 Open Budget Survey (OBS), conducted by the International Budget Partnership (IBP), Georgia got 81 points out of 100 in state budget transparency, the Transparency International Georgia said on Wednesday.
Georgia to receive €1.16 million for agriculture development
Within the GRETA project, the EU, Sweden and Austria launched the Local Development Initiative (LDI), to create great economic opportunities in the organic agriculture sector for farmers, farmer groups, cooperatives, processing units as well as other actors along various organic value chains.
Products rotten amid nationwide lockdown in Georgia
Food chain security is becoming more and more important as lockdown stays in place and farmers cannot transport their products from one place to another.
Georgian government to spend GEL 3.5 billion within crisis management plan
Georgian government has introduced a crisis management plan that consists of different stages. GEL 3.5 billion will be spent to cushion economy but this amount does not cover the post-crisis recovery period.
Georgia to receive €183 million from EU to fight Coronavirus
Due to the economic crisis caused by the pandemic of the coronavirus disease COVID-19, the EU has proposed a new package of macro-financial assistance.
Air traffic to be halted until May 22, GCAA says
Air traffic in Georgia will stay halted until May 22, 2020, Georgian Civil Aviation Agency says in a statement.
Georgian PM discusses support packages from ADB, EBRD
Prime Minister of Georgia Giorgi Gakharia held a video conference with the presidents of the EBRD and ADB regarding the possible assistance and financial resources to be allocated to Georgia due to the challenges associated with the global pandemic.
EBRD to provide €1 billion to Georgia, other countries
The EBRD and Georgia are stepping up cooperation as the country's economy faces the challenge of the coronavirus outbreak – says an official statement published on ebrd.com.
Government closes ski resorts in Georgia over COVID-19
The season at the ski resorts of Georgia closes ahead of schedule, the Prime Minister’s spokesman, Irakli Chikovani, said at a briefing.
Georgia will export armored vehicle Didgori Warrior
A new Georgian armored vehicle Didgori, equipped with a 120mm mobile mortar module, will be exported under the agreement signed between the Military Scientific-Technical Center Delta and one of the countries of the Middle East, the Ministry of Defence said.
Korter: Reliable housing property data in Georgia
It's not a simple job to find fresh homes. But when you use the estate choice service Korter, everything becomes distinct.
Rent a car in Tbilisi – Parent.ge
Are you thinking of booking the best vehicles for your next trip at a very reasonable price? If yes, then this is one of the best decisions you can ever make for yourself.
Pleasant Sunday for the whole family – Renewed Sunday’s brunch at The Biltmore Tbilisi Hotel
Summer, the season of endless fun and vacations, has ended and Tbilisi has become a usually crowded city.
GEL devalues, officials show optimism though
Devaluation of the national currency has sent shockwaves among citizens in Georgia. Officials think that the trend will return to its normal frame, though.
ProCredit Bank’s 20 years of challenges and successes in Georgia and what it means to be a responsible bank
“The bank’s 20-year long presence in Georgia was marked by many challenges and success stories.
Comments on alarming GEL devaluation
The National Bank of Georgia set a new exchange rate, according to which, dollar price became GEL 2.9507 on Tuesday.
Euronews and Silknet sign an MOU to launch “Euronews Georgia”
Euronews and Silknet, Georgia’s leading telecommunications company, are announcing the signing of an MOU in view of launching Euronews Georgia, a news channel and digital platform aimed at a Georgian-speaking audience.
Green Diamond starts to hand over flats to owners as second stage of construction finishes
Second stage of construction of Green Diamond living apartments by MAQRO Construction has finished and process of hand over of flats to owners has started.
Georgian wine tasting in the US came off excellently
Georgian wine tasting in the main cities of the US, New York, Chicago, and Boston went off excellently.
The most wanted fruits from Georgia
The fruit exportation has decreased in Georgia. According to Geostat (National Statistics Office of Georgia), this year, up until May Georgia exported 25 939 300 USD worth of fruit – 6 771 300 USD less than in 2018.
PHOTO OF THE DAY
GEL Exchange Rate
Convertor
26.05.2020
27.05.2020
USD
1
USD
3.1916
3.1916
EUR
1
EUR
3.4801
3.4801
GBP
1
GBP
3.8890
3.8890
RUB
100
RUB
4.4615
4.4615
Other Stories
Recently Toyota rolled out Global Campaign under this slogan that reflects the Olympic and Paralympic Spirit of Encouragement,
A couple from Switzerland combines Swiss tradition and technology with Georgian products. Their cheese is made in the Georgian mountains and sold in local stores and hotels.
It has been more than five years since the residents of Lilo village, near Tbilisi, cannot open their windows.
63 000 GEL was received by the Georgian Agro Export Group which is just a small part of the European Neighbourhood Programme for Agricultural and Rural development.
Georgian entrepreneur Guka Tavberidze, who runs his own business in the UK and does it quite well, has been invited by BBC
The grand opening of 7-star The Biltmore Hotel Tbilisi took place in Georgia’s capital on July 31.
DUSHETI, Georgia – The Georgian government and the World Bank will allocate USD 5.6 million (12 million GEL) to fund
A new Georgian clothing brand named Person has emerged in Georgian market.
Georgia is in the midst of an economic maelstrom, Euronews reports.
Situation at Georgia’s mineral water market is interesting: over the last year, the volume of export has grown by 56 percent. According to “GeoStat”, over $114 million worth of mineral water was sold
GEL Exchange
USD
1
USD
3.1916
EUR
1
EUR
3.4801
GBP
1
GBP
3.8890
RUB
100
RUB
4.4615
May 2020
Mon Tue Wed Thu Fri Sat Sun
1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31