FAO Regional Office for Europe and Central Asia

Georgia’s dairy sector to get a boost

Georgians have a proud tradition of dairy products but in recent years the country’s dairy farmers have struggled to meet production and quality demands. FAO and the European Bank for Reconstruction and Development are working with Georgia to pave the way for improved food quality and safety for dairy products.

Following independence in 1991, dairy farm ownership shifted from the state to the private sector and industrial processing largely gave way to small-scale, home production. Since then productivity has fallen, while imports of milk powder and foreign dairy products have increased.

Lack of quality control means that consumers face a dual challenge of food safety concerns and falsified products, which are a growing problem for the country’s dairy industry.

FAO and EBRD are getting involved at a critical time as Georgia and the European Union recently agreed on a Deep and Comprehensive Free Trade Agreement that will give Georgian dairy products unprecedented access to EU markets. As part of the agreement Georgia must first harmonize its food safety legislation with the EU, and farmers will be required to meet certain safety standards if they are to survive, let alone grow and export.

FAO and EBRD conducted a full review of commercial dairy farms and an overview of the national milk market. As a result, FAO was able to develop recommendations that will help support dairy producers, processors and traders while protecting consumers.

“The first step is education,” said Andriy Rozstalnyy, FAO animal health and production officer for Europe and Central Asia. “Productivity is far below potential, but this can be greatly improved through targeted training, better feed and health care, and a push for specialized education to increase the number of milk production experts and veterinarians.”

“The second step is attracting investments to build new dairy farms and modernize existing ones,” he added. “The technology needed to improve processes and increase quality exists – it just needs to be transferred.”

In 2013 EBRD provided a US$ 1.3 million loan to Kvareli Baga, a Georgian dairy company, to construct a new dairy farm in eastern Georgia. The farm was built to maximize open-air grazing and hosts over 600 cattle, of which 370 are milking cows with production levels far above the national average.

FAO has found that existing large and medium intensive farms could almost double their profits by implementing simple changes and adopting modern technology like that used by Kvareli Baga. Improving infrastructure and building farmer capacity will translate into better milk safety and quality, to everyone’s benefit.

If these efforts are successful, commercial milk production and processing should see immediate results and Georgia could approach self-sufficiency in just five years.

30 July 2015, Tbilisi, Georgia