Frozen Berries

Production and Export of Frozen Berries

Project Resume

Precondition

Domestic market:

  • Land area and Production of Berries in Georgia in 2015:

Blackberry- 59.6 ha, 127 tons, Raspberry- 316 ha. 724 .5 tons, Blueberry-114.6 ha. 131.4 tons

  • 7% on Produced berries sold on domestic market
  • Retail prices during harvesting season:

Blackberry 5-6 GEL/kg, Raspberry 6 GEL/kg, Blueberry 6 GEL/kg.

  • Retail prices during non harvesting season: average 11-12 GEL/kg
  • Insufficient level of Freezing tecbology development in the country

Export Markets:

  • Main Target market: EU
  • Import of Berries in EU from nonmember states: 400 EUR 2015 წ.
  • Main importer EU countries in 2015:

Germany – 108.5 thou. tons, France – 45.9 thou. tons, Belgium – 34.5 Th. Tons

  • Main Exporters:

Serbia – 120.7 thou. Tons, Poland – 107 thou. (Part of exports to Russia market)

  • Exports of Georgia (Tons)
Product 2013 2014 2015
Raspberry 0.02
Blackberry 0.6
Blueberry 0.6 29.2 40.3

Export Ex-work price of Georgian berries 5.25 USD/kg 

Advantages of Georgia:

  • Export of products to EU, USA, CIS and other countries are free form taxes
  • Favorable climatic condition
  • Cheap resources – electricity, water, workforce
  • Favorable geographical location: easy access to EU market via Batumi and Poti ports
  • Growth of berries farming and the state support to small and medium size farmers to plant berries new plantations
  • Deep and Comprehensive Free Trade AreaDCFTA ) agreement with the EU. This regime increases market access between the EU and Georgia

Project description

  • Location of the company – establishment of 2 agriculture hubs with freezing warehouses and equipment
  • Anaklia, Zugdidi Municipality, West Georgia
  • Mtskheta -Tianeti Municipality, East Georgia

 

  • Plantations:
  • Blue berry 10 ha. West Georgia
  • Blackberry 10 ha, Raspberry 5 ha. East Georgia

 

  • Products:
  • Shock frozen blackberry, raspberry and blue berry for the export markets
  • Raspberry and blackberry seedlings for the local market

 

  • Business Activities
  • Cultivation and harvesting of berries from the company’s plantations, processing, freezing and export to EU market
  • Purchase of berries from the local farmers, processing, freezing and export to EU market
  • Sales of raspberry and blackberry seedlings to local farmers
    • Refrigerator storage service to local farmers and companies
  • Number of permanent employees: 53
  • Ex-work sales price:
Product Price Market
Raspberry (Frozen) 11.55 GEL/kg Export
Blackberry (Frozen) 11.55 GEL/kg Export
Blue Berry (Frozen 11.55 GEL/kg Export
Seedlings (Blackberry, Raspberry) 1.0-1.5 GEL/Unit Local
  • Refrigerator storage service for the local farmers:
  • Minus temperature storage – 35 GEL/Ton per month
  • Plus temperature storage – 25 GEL/Ton per month
  • Production volumes
Product Year I Year II Year III Year IV Year V
1* 2* 1* 2* 1* 2* 1* 2* 1* 2*
Raspberry tons 10 30 15 40 50 50 75 60
Blackberry tons 20 30 80 40 280 50 320 60
Blueberry tons 15 30 15 40 60 50 150 60
Seedlings   units 225000 500000 500000 500000

1* – Harvested from own plantations

2* – Purchased from local farmers

Financial Data

Total Investment: 6.65 mln.Gel

Year III Year IV Year V
Sales                         mln. GEL 3.40 6.68 9.21
Operation Profit      mln. GEL 1.38 4.00 5.99
ROE 10% 52% 83%
ROA 12% 37% 38%

IRR: 24%

State support and Resources

The state provides the following financial and technical assistance

„Produce Georgia”  and “Plant The Future” programs Grant amount 1.55 mln./GEL for the purchase of Freezing equipment and for the irrigation systems of berries plantations

Technical assistance from Geo Silk Road Group

Recommend
Share
Tagged in