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BTU researchers calculate that food products accounted for 45.6% of the displayed annual contributions to Georgia’s domestic industrial producer price increase in September 2026, using their total of 4.58 percentage points. This identifies food’s important role in producer price growth, not its share of household spending or a forecast of an equivalent increase at the checkout.

Key Takeaways

• Geostat’s 20 October release reports that prices of industrial products manufactured for Georgia’s domestic market rose 4.6% year on year in September 2026; food product prices increased 5.5% and contributed 2.09 percentage points to the overall change.
• BTU researchers calculate that food represented 45.6% of the displayed total annual contribution and 63.5% of manufacturing’s 3.29-point contribution; food is part of manufacturing and must not be added to that sector’s total a second time.
• The domestic producer price index measures industrial products manufactured in Georgia and sold domestically at the factory gate; assessing consumer prices requires separate retail evidence rather than applying this index directly to a household basket.

Consumers encounter food price increases in shops, but a price does not begin at the checkout. Before reaching the final buyer, a product leaves its producer and passes through distribution and trade. Statistics taken at different points in that chain answer different questions. Producer prices describe the output stage; consumer prices describe what households pay for goods and services.

Food’s role at the first of those stages is visible in Geostat’s September figures, published on 20 October. Prices of industrial products made for the domestic market increased 4.6% year on year. That headline alone cannot identify which products made the largest contributions. The published breakdown allows the structure behind the total to be examined. 

BTU’s calculation finds that food accounted for almost half of the displayed annual increase. This matters both to businesses buying from domestic producers and to readers concerned about consumer prices. Interpreting it correctly requires two distinctions: a group’s rate of price growth is not its contribution to overall growth, and a producer price is not a shop price.

Almost half the increase is not half the basket

Food product producer prices rose 5.5% in September compared with the same month of the previous year. Their contribution to the overall annual index change was 2.09 percentage points. The first number describes price movement within the food group. The second identifies how many points of the aggregate increase were associated with that group.

The contributions of the four principal sectors in Geostat’s table sum to 4.58 percentage points. The headline annual rate is rounded to one decimal place, at 4.6%. BTU researchers calculate that dividing food’s 2.09-point contribution by 4.58 gives approximately 45.6%. Both sides of this calculation retain the precision of the published contributions rather than mixing them with a differently rounded headline.

This share describes the composition of the price increase. It does not mean that food represents 45.6% of the index basket, that a household spends that share of its income on food, or that almost half the products in a shop became more expensive. A contribution reflects a group’s price movement and its importance within the index. Dividing that contribution by the total increase does not recover the group’s basket weight.

Food’s importance is even clearer within manufacturing. Prices in this broad sector increased 4.3% year on year, contributing 3.29 percentage points to the overall index change. Food is included within manufacturing. BTU researchers calculate that its 2.09 points represented 63.5% of the manufacturing contribution. The remaining 1.20 points belong to other manufactured products; this residual is their combined contribution, not their own rate of price growth.

Composition of the annual increase September 2026

Source: Geostat [1]; BTU derives the other-manufacturing contribution as 3.29 − 2.09 = 1.20 pp. Groups are mutually exclusive; pp means percentage points. The annual headline is rounded to 4.6%; contributions total 4.58 pp. The residual’s own growth rate is not disclosed.

Showing food separately from other manufacturing avoids double counting. Adding food’s 2.09 points to the full manufacturing contribution of 3.29 would count the same movement twice. The table therefore divides manufacturing into two mutually exclusive parts. This is an accounting decomposition, not a model of what would have happened in the economy without higher food prices.

The increase extends beyond food

Food is important, but it is not the whole story. All other groups together contributed 2.49 percentage points, or 54.4% of the displayed total. Collectively, the larger part of the annual increase therefore came from products outside food. One prominent group is not a reason to overlook the rest of the price picture.

Mining and quarrying prices increased 7.9% year on year, a faster rate than food’s 5.5%. Yet mining’s contribution was 0.39 percentage points, far below food’s 2.09. This comparison explains why the fastest-rising group is not automatically the largest contributor to an aggregate increase.

Prices in the electricity, gas, steam and air-conditioning group rose 4.9%, contributing 0.77 percentage points. Water supply, sewerage, waste management and remediation services recorded 3.1% growth and a contribution of 0.13 points. All four principal sectors made positive annual contributions. Nevertheless, the energy group’s index is not itself a particular household’s tariff or a particular firm’s energy bill. [1]

Food is the only separately disclosed subgroup in this release. It cannot establish how much of the food contribution came from bread, dairy, meat or another product. Nor does it show that every food manufacturer or brand raised its prices by 5.5%. A group average does not identify an individual product’s price.

A factory price is not yet a shop price

Geostat’s methodology records domestic producer prices at the factory gate, excluding VAT, excise and transport expenses. The consumer price index observes something different: goods and services bought by consumers. These are distinct observation points, not interchangeable measures. 

Their coverage also differs. This September release concerns industrial products made in Georgia and sold on the domestic market. It is not an index of all food available in shops, where products manufactured abroad may also be sold. Nor does it combine the prices of every agricultural product: the disclosed food group belongs to the classification of industrial production.

A higher selling price at the producer stage can increase the purchase cost faced by a buyer further along the supply chain. Its effect on the final price depends on the particular product purchased, contract conditions, inventories and changes in other costs. Competition and the trader’s margin can also influence whether an increase is passed on fully, partially or at a different time. These are possible economic mechanisms, not outcomes measured in the September release.

For the same reason, the producer price index is not directly an index of production costs or profits. A rise in the selling price does not reveal how much raw materials became more expensive, whether wages increased or whether the producer’s margin changed. Additional cost and firm-level evidence would be required to establish a particular cause of September’s movement.

What the evidence changes for Georgian businesses and consumers

For a trading business working with a domestic producer, the release provides market context against which to compare its own purchase prices. A national average does not validate every supplier’s proposed increase. The relevant commercial comparison concerns the same product, quality, quantity and delivery conditions. Maintaining those distinctions can make price negotiations better informed without turning a statistical average into an automatic surcharge.

For a food manufacturer, the figures show that its broad product group played a substantial role in aggregate industrial price growth. They do not establish that every enterprise had the same ability to raise its prices. Restaurants, retailers and final consumers buy different products on different terms. Applying a uniform 5.5% cost increase to all of them would be unjustified.

BTU researchers assess that September’s practical signal is a reason to examine the domestic food supply chain more closely, not a precise forecast of future retail inflation. The opportunity is to explain changes more accurately: where actual purchase prices moved, and where other costs or trading conditions account for the remaining difference. The main risk is that one group’s average increase becomes an assertion that every product must become more expensive by the same amount.

The overall domestic producer index increased 0.2% from the previous month in September, while mining and quarrying prices rose 2.4% month on month. These monthly observations do not replace the annual decomposition. In particular, food’s calculated 45.6% share concerns the annual increase; this short release does not establish food’s contribution to September’s monthly movement. 

Answering the next question about consumer prices requires corresponding retail groups and product-level observations. The conclusion at the producer stage is already clear: food was an important component of the annual increase in prices of industrial products sold domestically, but it did not account for the whole change. Producer price information is most useful to consumers when it is interpreted without mistaking it for a checkout price.

Questions and answers

Does 45.6% represent food in household expenditure?

No. It is food’s 2.09-point contribution divided by the domestic producer index’s displayed annual contribution total of 4.58 points. This calculation does not measure household spending.

Why use 4.58 rather than 4.6?

The official annual rate is rounded to 4.6%. The same release displays contributions totaling 4.58 percentage points; that is the common denominator used to describe their composition.

Must food in shops become 5.5% more expensive?

That conclusion does not follow. The 5.5% figure is the annual producer price change for domestically manufactured food products. Retail coverage, costs and sales conditions differ.

Does the release identify the food product with the largest increase?

No. It provides no finer breakdown within food. Identifying changes for a particular product, enterprise or retail brand requires additional evidence.