07 Feb Georgian Wool: Can It Become the “Golden Fleece” Again?
Back in 2014, Georgia and the European Union (EU) signed an Association Agreement, which included the Deep and Comprehensive Free Trade Area (DCFTA) between the EU and Georgia. While this agreement creates new opportunities for Georgia’s agricultural exports, high food safety standards in the EU market make it difficult to fully utilize these opportunities. This is particularly true for products of animal origin, which are subject to strict regulations. The necessary standards were successfully met last year for Georgian wool (fleece), and it became the first animal product to be exported from Georgia to the United Kingdom market. This is a success, indeed!
Wool production was an important source of income for Georgian sheep farmers in the past. During the Soviet era, Georgia had more than 2 million sheep (around twice today’s sheep population), which used the winter pastures along the Caspian Sea. Wool processing and the textile industry were well-developed, and the price of greasy wool was 0.60 US$ per kg. After the dissolution of the Soviet Union, Georgia experienced a shortage of winter pastures, because it lost access to pastures along the Caspian Sea; moreover, the country also lost the traditional Soviet market for sheep products. Like many other industries, wool manufacturing collapsed.
Today, the main source of income for sheep farms is the sale of lambs and sheep cheese (specifically for Tushetian shepherds), while wool plays an insignificant role in income generation for farmers.
According to Geostat, Georgia produced 2,000 tons of wool in 2018 (on average, 2.4 kg wool per sheep). From the total amount of sheared wool in 2016, more than 50% (1,062 tons) was exported as greasy wool to the following countries: Turkey, Ukraine, India, and the United Kingdom.
Prices differed across export partners. The United Kingdom paid the highest price ($773/ton) in 2016, followed by Ukraine ($694/ton), India ($641/ton) and Turkey ($463/ton) . On average, the exported wool price in 2018 was $507 per ton. Five wool exporter companies operated on the Georgian market in 2016, and two of them hold a market share of 78%.
The rest of Georgia’s wool was partly used domestically to make woollen garments.
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