Georgian Wine Exports Plummet – What’s Happening in Georgia’s Strategic Market?

This year, during January-February, Georgia exported 9,594 tons of wine worth $29.1 million. At first glance, these figures might seem impressive, but the reality is drastically different compared to the same period last year – wine exports have decreased by nearly 40%, specifically by 38.4%. This sharp decline is driven by various factors, but Russia, which remains the primary export market for Georgian wine, deserves special attention.

The geographical structure of exports remains unchanged for now, with the Russian Federation still leading. However, despite maintaining its position, Georgian wine exports to the Russian market have dramatically decreased by 55.3% over the last two months. Experts attribute this decline to several important reasons, including the impact of sanctions, Russia’s economic instability, and escalating international tensions that significantly complicate the entry of Georgian products into the Russian market.

What makes this situation especially concerning is that the contraction of the Russian market has a painful impact on Georgian wine, as more than half of the country’s wine exports go to Russia. Current data shows that $16 million worth of 5,643 tons of wine was shipped to Russia, accounting for almost 55% of total exports. Interestingly, the average price of wine exported to Russia is quite low – only $2.84 per liter, making it much less profitable for Georgia compared to wine sold in Western markets.

Unlike Russia, Western markets, where export volumes are relatively small, offer significantly higher prices for Georgian wine. A clear example is the United States, where the average price of exported wine per liter reaches $7.01. Although only 193.7 tons of wine worth $1.3 million was shipped to the US, the high price makes this market particularly profitable for Georgia. A similar situation exists in Europe – for example, the average price of Georgian wine in Germany and Latvia is over $4 per liter, highlighting the economic potential of these markets for Georgia.

China also plays an important role – it is emerging as a stable market for Georgian wine and is now among the top five export destinations. The average price per liter of wine sold in China is $2.90, indicating that the market is strategically promising for Georgian wine in terms of both scale and price ratio.

The latest statistics clearly show that Georgia needs to diversify its markets and especially strengthen exports to high-income Western countries, where quality and uniqueness are highly valued. Reducing dependence on the Russian market has become an urgent necessity given the current circumstances. Moreover, it is essential to establish a more stable and sustainable export strategy that will protect Georgian wine from similar sharp declines in the future.

Georgia is historically regarded as the cradle of wine, and interest in this product remains consistently high. Therefore, in the face of these challenges, it is crucial for the government and the private sector to work together to improve wine quality, strengthen branding, and diversify export markets. Only by taking these steps will Georgia be able to fully capitalize on its historical and cultural advantage, helping the country solidify its position in the international market.