Expanding the Market to the Farmer – RED Launches New Activities in Georgia
The Rural Economic Development program (RED) is a joint development project of the Ministry of Foreign Affairs of Denmark (DANIDA) and the Swiss Agency for Development and Cooperation. The objective of the program is to increase income and employment through the development of potato and dairy/livestock value chains in Kvemo Kartli and Samtske-Javakheti.
Sorting, grading and packaging of potatoes and cutting costs for Georgian farmers by providing them with an urban market in the country, is one of the objectives of the RED program based in Georgia. “Linking the city to the country reduces marketing costs and risks for the farmer and the urban buyers, improving the efficiency of moving higher quality potatoes to the consumer,” said a RED representative to Georgia Today.
As part of the program, 23 farmers and entrepreneurs from Samtske Javakheti and Kvemo Kartli regions were shown the benefits of a modern, locally based sorting and packaging machine in a grading center in Bolnisi, Kvemo Kartli. The demonstration was conducted by consultants from the German company Euro-Jabelmann, and coordinated by local firm DV + who also offered technical advice.
The participants were able to see for themselves how this process will benefit them, by providing year-round, fixed local markets, firm production contracts and identifiable, traceable packaging, which will lead to increased sales and revenue.
“There are plans for more such demonstrations planned by DV+ to attract more farmers to the practical benefits of this modern value chain system, in which everyone wins,” RED says. “ RED hopes for more types of facilities to be established in other municipalities,” they add.
The RED program is one part of the value chain development assistance and support. Seven commercial model farms show potato growers how to increase their production and quality while lowering farm production costs per metric ton. Moreover, the hands-on and vocational training provided by these commercial farms is expected to benefit an estimated 1,700 potato growers in Samtske Javakheti and Kvemo Kartli regions of Georgia.
“Better production alone however does not lead to economic improvement for the farmer; it requires reliable, efficient links to the market,” assumes RED. They think the first such links are the locally based grading and packaging facilities to purchase and move an estimated 20,000 tons of potatoes, nearly 10% of total production in these two regions, to the institutional buyers in the urban markets.
DV+LLC, founded in 2003, provides services to over 2,000 local farmers in the region. The company is a main provider of potato seeds, fertilisers, pesticides and irrigation material. With assistance from the RED program, the aim is to make DV+ a significant part of the potato business in Kvemo Kartli region, leading to improved market access and revenues for local farmers and better quality produce for the consumer.