Wine in-depth: Companies Losing Ukraine(2)
Impact of the August 2008 conflict
According to company reports the Kakheti region, Teliani Valley’s base and the main winemaking region in Georgia, was not directly affected by the August 2008 conflict between Georgia and Russia; therefore Teliani Valley’s facilities have not been damaged. However the conflict has caused some logistical disruption to the company, as for approximately three weeks starting from August 7, 2008, Teliani Valley was unable to export its products and receive imported materials and equipment. Disruption in exports resulted in the loss of shelf space in certain countries.
According to the Department of Statistics of Georgia in 2007 the total export of wine from Georgia was equal to USD 291,974,000. From this amount USD 147,984,000 of wine was exported to Ukraine , which is over 51% of the total export.
In 2008 total wine exports increased and reached USD 368,628,000.From this amount USD 190,157,000 of wine was exported to Ukraine , which was 52% of total exports. In the 4th quarter of 2008 total trade of goods with Ukraine reached USD 393,860,000.
But since the financial crisis started evolving in Ukraine , selling wine has become more and more difficult.
“Figures have decreased quite notably in Ukraine . The sales for November 2008, December 2008 and January 2009 together were 70,036 bottles. Still the sales of January-February 2009 compared with the same period in 2008 were increased by 3%. Different factors have provoked such changes, such as holidays for example. However it doesn’t mean that the global financial crisis will not affect exports in 2009,” said Margvelashvili, TbilVino
As Margvelashvili explained, in spite of the fact that the first two months of 2009 are better in terms of sales rather than the same period of 2008, this is not the actual picture of the situation.
