Georgian Farmers Combine Efforts to Generate Viable Incomes
“In strength there is unity.”
Koba Tsertsvadze, a 41-year-old farmer from the village of Tkhinvali in Guria addressed visitors with these words as he and other farmers fenced plots of land on a tea plantation in his village. He added, “As members of the partnership AgroProduct, many local farmers have decided to combine their efforts to produce a decent living for their families. AgroProduct offered us a strong incentive for next year—to produce better quality tea, in larger quantities, and to be able to sell our products at a reasonable price.”
In Georgia, there are numerous small farmers with very small plots of land that are trying to make a living on the agriculture products they produce and sell. In reality, most are only able to sell a small portion of what they produce at below-market prices, and therefore survive by consuming their own products. “In recent years I made my living by selling hazelnuts, though I have more than 1.4 hectares under citrus, tea, vegetables and other fruit,” Tsertsvadze explained.
A number of attempts have been made to convince Georgian farmers to form legal cooperatives to work together and sell their products in bulk, but the majority of these efforts have been unsuccessful. Memories of Soviet-style cooperatives, which were not profitable for individual farmers, have negatively influenced farmers’ perception of the cooperative concept.
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| Tea plantations in Guria rehabilitated through USAID assistance have helped local farmers move beyond subsistence farming |
A six-month program developed by the Guria Agribusiness Center, funded by USAID’s Small and Medium Enterprise (SME) Support project’s competitive grants program, addressed this critical but solvable agribusiness dilemma. The program focused on market chain improvement, coordination among stakeholders, and cooperation between farmers with the overall objective of increasing agricultural income opportunities in west Georgia. The concept, as designed by the Center, differed from those that had been attempted in the past.
The Center’s director, Aleko Mameshvili, began by approaching each farmer individually, rather than gathering the farmers together. This was a time-consuming process, because the director had to educate each farmer on the concept of partnership and then enlist the individual’s participation. Ultimately, the approach was highly successful.
Dan Berkshire, Chief of Party of the SME Support project, has been pleased with progress made. “Our expectations have been justified. The activities envisaged under the project have already improved agricultural market chains and mitigated previous problems stemming from misinformation and a lack of coordination, and have produced additional income for the small farmer.”
The Center took additional steps to ensure success by establishing a rudimentary collection point for products delivered to buyers; assisting with transportation to bring products to the collection point; providing detailed information on the size, quality, and quantity of products to be delivered based on buyer specifications; and developing concrete and lasting contractual trade deals through AgroProduct with processing enterprises, including Rubikoni Ltd., Vagi Ltd., and Georgian Bouquet, that ensure a reasonable profit for all. AgroProduct members are currently able to sell more than 50 tons of tea, 300 tons of citrus fruits, 50 tons of chestnuts and kiwi, and 10 tons of berries and pekoe at a price almost unimaginable last season.
“Now I can plan my future,” reported Tsertsvadze. “According to some very rough estimates, I will sell more than 1.4 tons of tea next year with GEL 1,050 income to say nothing of citrus fruit, for which I expect to earn more than GEL 1,200.”
According to Mameshvili, the Center’s activities “have increased the incomes of farmers by 20 to 40 percent (depending on the type of agricultural production), as well as created new job opportunities in agriculture—especially in high-value farming, food processing, and exports. AgroProduct’s estimated annual sales volume is about $85,000. Besides this, we definitely have much more work to do now to resolve some of the problems identified during project implementation; the partnership needs a sorting conveyor and some basic agricultural machinery like a seeding-machine and a reaper. Also, we need some decent packaging for our fruit to meet at least a minimum of market requirements. In any event, with the assistance of USAID’s SME Support project, we have created a model that we hope could be replicable in other agricultural regions of our country.”
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