Why did onion prices rise in Georgia?


Why did onion prices rise in Georgia?

04/20/2020

From April 12 to June 30, a ban imposed by the countries of the Eurasian Economic Union on the export of certain goods, including onions, entered into force

According to the results of EastFruit weekly price monitoring, the average wholesale price for onions in Georgia was 2.2 GEL ($ 0.7), and a week earlier – 1.6 GEL ($ 0.5). EastFruit analysts identified factors that influenced price increases.

At this time, onion prices traditionally rise every year. This is due to the transition period in Georgia and the exporting countries, when the stocks of the old crop are running out and the new crop has not yet entered the market. However, this year the transition period was supplemented by restrictions imposed on COVID 19. These restrictions hindered the import-export of food products between countries.

In addition, from April 12 to June 30, a ban imposed by the countries of the Eurasian Economic Union on the export of certain goods, including onions, entered into force. The main importers of onions to Georgia – Russia and Kazakhstan – are members of the Eurasian Economic Union, while Georgia is not.

See also: Lower prices for garlic and ginger, an increase in the supply of wild strawberries, the revitalization of Ukraine – analysis of EF trading floors per week

According to the first quarter of 2020, 55% of onion imports to Georgia were from Kazakhstan and 33% from Russia (in value terms). Currently, onion imports from these countries are suspended, and Azerbaijan and Turkey are alternative partners for onion imports for Georgia. Importers are already planning to switch to products from these countries, although the reason for the jump in prices in the last week may be speculative. In the near future, when Georgia begins to import onions from alternative markets, prices may fall.

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