FAO Regional Office for Europe and Central Asia

Dairy Congress kicks off next phase of EU-FAO-EBRD support for Georgian milk producers

The benefits of cooperation and opportunities for small- and medium-sized dairy enterprises topped the agenda of the Second Caucasus Dairy Congress held in Georgia’s capital, Tbilisi, today.

The event, supported by the European Union and Georgia’s Ministry of Agriculture, was the latest effort by the European Bank for Reconstruction and Development (EBRD) and the Food and Agriculture Organization of the United Nations (FAO) to strengthen Georgia’s dairy industry.

Over 200 participants from the Caucasus and Eastern Europe attended the Dairy Congress, including commercial dairy farmers, processors, equipment suppliers, industry experts, and representatives of the Georgian government.

For Georgia, part of the Deep and Comprehensive Free Trade Area (DCFTA) with the European Union, increasing sector efficiency and improving the quality and safety of its dairy products are key to staying competitive.

“Thanks to the Association Agreement, Georgian farmers can export their products to the EU single market, and consumers in Georgia will profit from better quality and healthier dairy products,” said Janos Herman, the European Union’s ambassador to Georgia. “To achieve this, Georgian dairy producers need to meet EU standards. The EU supports them in this through several ongoing projects. Many of us look forward to enjoying Sulguni and Matsoni in the European Union.”

Sulguni is a Georgian cheese, while Matsoni is a product similar to yogurt.

Industry on the upswing

Thanks to a good investment climate, ideal dairy farming conditions, and strong demand for milk, cheese, and other products – many of them unique to Georgia – the country’s dairy industry is experiencing a growth spurt.

Over the past few years, FAO and the EBRD have helped the country’s commercial dairy farmers boost milk productivity and quality. They’ve organized technical training, international study tours and four knowledge sharing events, including today’s Dairy Congress, to explore the latest dairy trends, technologies, food safety standards and investment opportunities.

They also have helped the Association of Commercial Milk Producers of Georgia launch georgiandairy.org, the only professional web portal for Georgian dairy sector stakeholders, which provides regular market analysis and news, price information, trade statistics, and information on modern milk production technologies.

Farmers trained by FAO and the EBRD have invested more than USD 2.5 million to modernize their operations and buy more productive livestock breeds, resulting in higher yields and profits.

Since the project’s launch in 2015, the production of high quality milk in Georgia has more than doubled, and most of the commercial producers have been assisted by FAO and the EBRD.

The next step is greater cooperation across the sector, said Andriy Yarmak, an FAO agricultural economist.

“The project’s first two phases were about transferring as much knowledge as possible and promoting dairy business investments, with impressive results,” he said. “By working together in farmer cooperatives – sharing costs for feed or the services of livestock nutrition specialists, for example, or joining forces to sell or process milk – Georgia’s milk producers can take it to the next level and increase their profits significantly.”

EU and the EBRD provide further significant support to the sector. For example, the EU-EBRD DCFTA Adaptation Programme supports dairy producers in applying DCFTA-related technical regulations, quality standards, new food safety standards, and sanitary and phytosanitary requirements through training, seminars and consulting projects.

Greater cooperation

The Association of Commercial Milk Producers of Georgia, modelled on a similar association in Ukraine, has become a knowledge centre for other commercial farmers in Georgia.

It is now looking into developing fee-based advisory services for technology and veterinary care for its members and other sector stakeholders.

“This next phase of the project will focus on strengthening the capacity of the Association, promoting cooperation along the dairy supply chain, analysing existing legislation and facilitating dialogue between the private sector and the government,” said Victoria Zinchuk, head of the EBRD’s Agribusiness Advisory.

The next phase also will be about promoting the country’s high quality dairy products – many of which were showcased during the Dairy Congress – and developing niche products, like organic milk or goat’s cheese, to tap into new markets.

“We still have a way to go, but I definitely feel we’re moving in the right direction,” said Nikoloz Beniaidze, a dairy farmer and member of the Association of Commercial Milk Producers of Georgia.

Another FAO-EBRD project is focusing on developing Geographical Indicators (GIs) – quality labels that link products to their area of production – in the Georgian dairy sector. Given the wealth of traditional food products in Georgia, FAO and the EBRD are working to strengthen producer organizations to promote and protect many products, including two cheeses: Sulguni and Tushetian Guda.

14 March 2018, Tbilisi, Georgia