Russia looks at ban on Georgian wines

Tensions are once again flaring between Tbilisi and Moscow, with wine caught in the middle. Eugene Gerden reports.

Photo of Tbilisi by Denis Arslanbekov on Unsplash
Photo of Tbilisi by Denis Arslanbekov on Unsplash

The Russian government is currently assessing whether to ban wine imports from Georgia, according to sources in the Russian Presidential Administration.  This is in response to the recent anti-Russian demonstrations in Georgia.

If the ban goes ahead, the official reason will be the purported poor quality of Georgian wine and its non-compliance with Russian standards.

A spokesman for Anna Popova, head of Rospotrebnadzor (Russia’s Federal Service for the Oversight of Consumer Protection and Welfare) told Meininger’s that imports of low quality Georgian wine to Russia have increased, sparking concerns from the Russian government.

Rospotrebnadzor said it is going to increase inspections of Georgian wine imported to Russia, which may eventually lead to a partial or complete ban of the wines.

The regulator has already begun collecting data on Georgian wines already sold to Russian retail chains.

For their part, the Georgians reject the claims of non-compliant wines. A spokesperson from the Georgian National Wine Agency said, “Russia’s ‘quality concern’ is 100% politically driven and has nothing to do with actual quality.”

Reactions

The possibility of a ban has already sparked concerns from leading Russian wine importers.

 “If Georgia leaves the Russian market, this niche will be probably filled by wines of the New World,” said Dmitry Zhurkin, director of the import department for Ladoga Group, one of Russia’s largest wine importers. “At the same time, we must say that the damage will be caused not only to Georgian producers, but also to Russian importers to a lesser extent. In recent years, there has been an active promotion of Georgian wine on the Russian market, which came in the form of huge investments from some importers.”

Consumers will suffer as well, as sales of Georgian wine have increased in recent years. This is despite the fact that Georgian wines are now often positioned as premium wines, selling for higher prices than they did in the past.

Zhurkin added that Georgia is also the exclusive supplier of orange wines, a newly trendy segment. Georgia’s qvevri wines are attracting a new generation of wine lovers, rather than appealing to an older generation who remain nostalgic about Georgia. According to Ladoga, Georgian wine appears on the list of almost half of restaurants in Russia.

Zhurkin claims, however, that the regulatory bodies may also have a point beyond politics. “If we take the volume of imported wine of the geographical indication ‘Alazani Valley’, then it significantly exceeds the capabilities of this region,” he said. “Obviously, not all wine under this brand imported into Russia has the corresponding origin.”

The Georgian National Wine Agency says this claim is based on a misunderstanding of what Alazani wine is. “[If] Alazani is on the label, this doesn’t necessarily mean it comes from that particular valley. Alazani Valley is the GI not the PDO, and can come from anywhere in Kakheti,” said the spokesperson, adding that there is more than enough wine “to send Russia and elsewhere”.

The spokesperson also told Meininger's that Georgian wine labels are often forged in markets like Russia and Ukraine. “In the case of Russia, this country imports lots of bulk wines from around the world and the local businesses just put the Georgian labels (on), not only of Alazani, but Kindzmarauli, Khvanchkara etc, because these labels have high recognition there. It is very difficult for us to track these kind of cases, though we did several in the Ukraine.”

The scale

The Georgian National Wine Agency says it exports more than 55m bottles of wine to Russia. According to TSIFRRA, one of Russia’s leading analyst agencies in the field of wine, Georgia was the second biggest importer of still wine to Russia, with a share of 17%, in the first quarter of 2019. Overall, Georgia has a 7.5% of the Russian market and in 2018 was the third most imported country after Italy and Spain.

If the Russian government does go ahead and ban Georgian wine imports, it will be for the second time in recent years. A previous conflict between Moscow and Tbilisi led to the first ban, which lasted from 2006 to 2013. At the time, the Russians said the ban was necessary because of In the meantime, that could be already the second ban on the Georgian wine imports, imposed by the Russian government due to political issues in the last two decades. The previous conflict between Moscow and Tbilisi led to the introduction of the ban, which lasted from 2006 to 2013. At that time, the Russian authorities said the main reason for the ban was high levels of pesticides and heavy metals found in the wines. Although the ban was widely recognised to be payback for Georgia’s pro-NATO stance, it was later reported that a handful of Georgian producers were indeed faking wines.

Prior to 2006 ban, Russia accounted for 70% of Georgian wine exports. After the ban, Georgia re-directed its wines to the EU and other CIS states, which helped to raise its quality.

Eugene Gerden

Additional reporting by Felicity Carter. Article updated with Georgia's point of view on 4 July 2019.

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