"The Georgian market is oversaturated with imported Turkish and Chinese tomatoes and cucumbers marinades," Giorgi Museridze, a spokesperson of the Marneuli Food Plant, says at a parliamentary commission on price study.
According to him, several factors have an impact on product pricing, including the dependence of various goods on imports, land reclamation, labor costs, market deficit, competition, increased distribution expenses, and others.
Moreover, labor and fuel are key cost drivers in crop farming. We also can't buy glass jars domestically and import them from Turkey, Russia, Ukraine, and Moldova, which impacts the final price.
"Water is a critical component for us, as we use it to process cucumbers, tomatoes, and other products. In agriculture, land reclamation is essential. We face challenges due to the inability to physically irrigate our fields, resulting in considerable losses, and even a single day without water can affect how plants grow. Our industry requires significant working capital – we start spending money in the fall when we begin tomato planting, then, as we are import-dependent, we fully finance packaging materials in the spring, which account for 30-35% of our product cost, and then, when the harvest comes in the summer, we sell it throughout the year as payments are received. All these factors influence the price."
The production volumes in Turkey and China are huge. The Georgian market is full of imported Turkish tomatoes, pickled cucumbers, and Chinese tomatoes. It's not just about the price; we do have a market share thanks to our quality and loyal customers, but it's not so big that we can dictate prices.
Turkey has export financing, and to put it simply, producing 1 kg of concentrated tomato paste requires approximately 5–6 kg of fresh tomatoes.
‘Over the past year, distribution costs have also risen significantly. Previously, 1 kg costs 20 tetri, now it costs 22-23 tetri as our working conditions have also complicated,"- Giorgi Museridze points out.
