EBRD loan helped launch Kvareli Baga farm in Georgia’s Kakheti
Kakheti is almost entirely covered by vineyards: it is Georgia’s most famous wine region.
Georgians don’t just want to drink wine, however. Georgian families want fresh, high-quality milk, not milk made of imported reconstituted powder. But only one tenth of milk sold in the country’s shops is domestically produced.
On Kakheti’s steep hills, where even vines cannot climb, there are plenty of small local cows looking for sustenance. They produce both meat and milk, but not much of either. It took a local property entrepreneur, Lasha Papashvili, to see this challenge as a business opportunity.
Mr Papashvili knew little about dairy production to begin with but he did know how to start a successful business. He researched the sector, took out a US$ 1.3 million loan from the EBRD, brought in the best experts from Switzerland, Israel and beyond, and had a leading global supplier DeLaval design the farm outside the town of Kvareli, 140 km east of Tbilisi.
Then he brought 136 Holstein heifers from Germany. The new farm, Kvareli Baga, now has almost 380 cows and is the largest producer of milk in the country.
“It was pure business,” he said. “My interest is to improve this part of the economy: agriculture and especially dairy farming where there is high demand. There is great potential in agribusiness in Georgia.”
His big-eyed cows must be the largest and the most productive in Georgia, giving an average of 27 litres of milk a day.
The farm was expected to produce about 9,000 litres of milk per day in April and is steadily increasing its output. But the main thing that strikes a visitor to the farm is the standard of animal welfare and hygiene. The cows graze in open air enclosures overlooking the mountains and the quality of milk is tested on the spot at every milking (which happens three times a day, following best practice from the USA and Israel).
Meanwhile, Mr Papashvili is considering his next steps in dairy farming and other sectors and looking for continued support from the EBRD.
“It was very important that the EBRD took a risk with us to build this kind of business in Georgia – and I hope they will be there as we expand,” he said.