The Khachapuri Index Is Down 5% m/m As Milk Production Picks Up In Imereti

The FINANCIAL -- Spring is already here. Seeing more sunshine and rains, Georgia’s western provinces are enjoying the sharpest seasonal increases in the supply of fresh milk and dairy products, such as Imeretian cheese. This cheese is the main (and most expensive) component of the Georgian khachapuri, driving the sharp seasonal fluctuations of the Khachapuri Index. 

In March 2016, the national average cost of cooking one standard Imeretian khachapuri declined to 3.27 GEL, which is 5% lower month-on-month (that is compared to February 2016) but 6.9% higher year-on-year (compared to March 2015). The y/y increase in the Khachaprui Index is roughly in line with the official estimates of annual CPI inflation by GeoStat.

At 3.17 and 3.25 GEL per portion, respectively, Kutaisi and Batumi, are currently the cheapest markets for khachapuri ingredients. In just one month, both cities have seen very healthy declines in the price of cheese and the khachapuri basket (down 4.5% in Batumi, and 9.3% in Kutaisi), going from first to last in the Index. 

At the opposite end of the country, in Kakheti, prices are adjusting more slowly given lower levels of precipitation, which affect the quality of pasture and milk production. Kakheti has seen a very modest decline in the Index (down by only 1.8%) on the back of slower growth in fresh milk supply and a surge in weekend tourism – quite common at this time of the year.