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Georgia: a comparative advantage in Caucasian Fir trees - great for the festive season




The Caucasian Fir is Europe’s favourite yuletide tree – it is beautiful, house-friendly, not sticky, and its pine needles are softer than other species and less likely to fall off.


Otherwise known as Nordmann Fir or Abies-Nordmanniana, the Caucasian Fir is a tall evergreen native tree in the Caucasian mountains (Investor.ge, December-January 2013/14). It was named after Alexander von Nordmann, a Finnish biologist who studied the tree in the nineteenth century.


A representative of Fair Trees, based in Denmark and the only Fair Trade certified Christmas tree grower, said that Georgia dominates the niche market in Christmas trees. However, Georgia does not export fully-grown trees. Instead, it sells seeds from the Caucasion Fir to growers abroad, who plant them in their local nurseries. These seeds account for 90% of the estimated 45 million Christmas trees sold every year in Western Europe, according to Fair Trees. Denmark is Europe’s largest exporter of yuletide trees, supplying 7 million per annum on average.


In 2011 PricewaterhouseCoopers (PwC) conducted a feasibility study into the potential of Caucasian Fir farming in Georgia, at the request of the Georgian government’s sovereign fund, the Partnership Fund. The study revealed that Georgia has cheap and available land and labour, in addition to the Caucasian Fir seeds, but it lacks the capital and the knowledge of fir tree farming which requires high-tech horticulture. In addition, the time needed for a production cycle – from seed harvesting to tree farming and export – is seven to nine years, which is a deterrent for small investors.


Europe has a mature market and Denmark itself is estimated to double its production in Christmas trees in the next 10 years. For Georgia to enter the competitive market won’t be easy. Europe has fir farms the size of 500 hectares. There is also a strict phyto-sanitary regulation for importing live plants into the European Union, although local and foreign companies have exported live plants and seeds to EU from Georgia in the past. Nevertheless, the PwC study highlighted the market for live Christmas trees is limited due to supply shortages. The main competition comes from artificial trees (mainly produced in China), although Georgian trees would be cheaper.


The study claimed that Georgia could improve their Caucasian Fir seed collection, but that won’t be easy either. Georgia has approximately 130,000 hectares of forests available for licencing if it takes on the commercialization of fir trees. But in 2009 the body that regulated forestry management was abolished. Companies are still required to apply for a licence, but inspections are conducted only following specific complaints to the Ministry of Environment, despite companies’ requests for legislative changes in forest monitoring, taxation, and licencing.


Collecting the seeds can be dangerous. The best trees grow in Racha in the Caucasus mountains of western Georgia, where trees grow to 60 metres and the best pine cones are at the top of the trees. Cone pickers need to collect 10 kilograms of cones to make one kilogram of seeds. And there is a narrow window of time to collect the cones – only two weeks in September for harvesting. At such time, the competition to collect cones is intense, and pickers come from all over the country.


In the 1960s European fir tree farmers travelled to Georgia to study the tree and developed the business of seed trading between Europe and Soviet Russia. Nowadays, Fair Trees is interested in improving the conditions for cone pickers in Racha to make this a viable business option to ensure that the Caucasian Fir produces many more yuletide trees.


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