HONEYMOON

Food and Agriculture Organisation of the United Nations (FAO) reports that the overall volume of world honey trades over the past five years increased by 18% reaching 790.3 thousand tons in 2017 ($2.37b). China holds the leading position among honey exporters (19% of total exports). The rest of the countries in this list includes Argentina, Ukraine, Vietnam, and India. At the same time, these countries mainly export inexpensive honey with an average price of $2.1-4 per kilogram and quality characteristics not always meeting the required standards.

What is the export potential of Azerbaijan in this context and what are the prospects for increasing honey production in the country?

Blessing in disguise

Not long ago, the export volumes of Azerbaijani honey were insignificant. This was due to a number of factors, including the extremely low productivity of Azerbaijani bee-yards. For many years, the average volume of honey from one hive by local beekeepers has been around 10-11 kg, while the world average is 30 kg. For example, in Germany and a number of other developed countries this figure exceeds 50 kg. In other words, with an equal number of hives, the productivity of Azerbaijani bee-yards is three or more times lower, and, accordingly, the cost of honey is higher, as well as its final price. The main reasons are insufficient infrastructure, lack of modern methods of increasing production volumes, as well as the high percentage of bee deaths from diseases and parasites due to insufficient veterinary support. The lack of competent breeding work also led to a mixture of the indigenous autochthonous Caucasian breed of bees with breeds brought from abroad and, as a result, an increase in the number of unproductive hybrids.

Azerbaijan is one of the countries where domestic consumption of honey significantly exceeds its production volumes. Some eight years ago, the production of honey in the country was around 1.5 thousand tons per year, which was almost three times less than domestic consumption. The situation slightly improved after the adoption of the law on beekeeping in 2009 and the implementation of a set of measures to increase the number of bee-yards, as a result of which the number of bee colonies increased by almost 85%, reaching 271 thousand.

According to the Ministry of Economy, despite a twofold increase in production (3 thousand tons in 2017), domestic honey producers cover only about two thirds of their domestic needs, while the rest of production volume is imported. This measure did not stimulate beekeepers to lower the prices, which over the past years consistently kept at around ₼20 per kilogram of high-quality honey. Although this price was acceptable for Azerbaijan, it was not for organising mass exports: at the pre-devaluation rate of ₼0.78 per $1, the export price of a kilogram of Azerbaijani honey exceeded $25. This put honey in the category of niche products competing with products of the level of New Zealand and other leaders of the honey market.

Actually, the key factor that helped to set up the export of Azerbaijani honey in the last two years was the decline in manat's rate: with the rate of ₼1.7 per $1, the price of a kilogram of Azerbaijani honey decreased by more than two times and, accordingly, its export competitiveness increased.

From Japan to the Emirates

According to the Ministry of Agriculture of Azerbaijan, large-scale export of domestic honey began about two years ago: the largest volume, 6,000 tons, was delivered to Japan for more than $48 million ($8,000-8,500 per tonne) in profit. The region of the Middle East, and in particular the countries of the Persian Gulf, are no less significant. Local honey has been accepted quite well in the Arab tourists being the driver of the tourism development in Azerbaijan for three consecutive years. The most successful deliveries of honey have been made to the UAE, and negotiations are under way with Bahrain and Qatar. China is also interested in buying Azerbaijani honey.

"Tourists from Arab countries are actively buying local honey, and today beekeepers sell a significant part of their products to this region. The main task of our ministry is to promote beekeeping products so that we attract additional currency to the country," said the representative of the Ministry of Agriculture, Vugar Huseynov.

The price of Azerbaijani honey is slightly higher than the average world market prices because of its composition quality and mainly belongs to the category of organic products. It is produced in an environmentally clean area from environmentally friendly raw materials without the use of synthetic substances at all stages of collection, production and processing. This is not surprising, since 61% of the nectar-bearing zones in the South Caucasus are located in Azerbaijan. Even the world experts and in particular FAO confirms high characteristics of organic honey produced in Azerbaijan.

By the way, FAO provides comprehensive assistance to the development of beekeeping in Azerbaijan: with the support of this organisation, a project to improve the gene pool of local bees was implemented and preparations are underway to implement a project that helps solve problems with packaging and international certification of Azerbaijani honey. "A new project with an estimated cost of $800,000 is a follow-up project aiming to increase the export potential of Azerbaijani honey, which, according to many experts, is one of the best in the world," said the head of the FAO partnership and coordination office in Azerbaijan Melke Cakmak. With the support of FAO, it is also planned to set up two honey packaging enterprises in Ganja and Astara. Another such enterprise will be created in Gakh region on the initiative of the Association of Beekeepers of Azerbaijan.

Assistance to Azerbaijani beekeepers is also provided through the Turkish Cooperation and Development Agency (TIKA). Thus, dozens of Azerbaijani farmers have recently completed their studies on the experience of pedigree beekeeping in Turkey. TIKA also provided technical assistance and contributed to the creation of experimental farms for breeding bee-maids, etc. "TIKA specialists help in the restoration and development of beekeeping in Jojug Marjanly village of the Jabrail region freed from occupation. In the near future, another pilot project on the development of beekeeping among women is planned in the north-western regions of Azerbaijan. The project will be implemented jointly with the USAID, and we have already selected five women from Balaken, Sheki, Zagatala and Gakh regions," the Chairman of the Azerbaijan Beekeepers Association Badraddin Hasratov said.

Bees with passports

In recent years, the government of Azerbaijan has also provided large-scale support for the development of beekeeping in the country. One of the important steps in this direction was the decree of Azerbaijani President Ilham Aliyev on subsidising individuals and legal entities employed in beekeeping. Thus, in five years starting in 2018, beekeepers will be given ₼10 for the maintenance of each bee colony. In order to implement the presidential decree, a special commission was established in the Ministry of Agriculture of Azerbaijan in October 2018, which will begin issuing passports to bee colonies (hives) by region, and each bee colony will receive an identification code, which will also establish the exact number of bee colonies in the country. According to V. Huseynov, after that the State Centre for Agrarian Development together with the commission of the Ministry will arrange the issuance of subsidies. “The purpose of subsidies is to provide state support for the development of beekeeping and the preservation of the gene pool of bee colonies. During the collection of products, beekeepers take most of the honey, which often creates a problem with the feeding of bees, and in March-April, some bee colonies die. State subsidies will allow bees to leave the required amount of honey and reduce the mortality rate of bee colonies,” Vugar Huseynov said.

In parallel with subsidizing beekeepers through state funds, preferential loans are provided to the industry. Thus, in recent years, in order to support the development of beekeeping, about 400 entrepreneurs have been granted over ₼4.7m of soft loans.

The key guideline for the development of the industry should be the adoption of the State Program for the Development of Beekeeping for 2018-2022, developed by experts of the Association of Beekeepers of Azerbaijan in cooperation with the ministries of economy and agriculture. “In the field of beekeeping in the country there are complex problems that need to be addressed. In particular, it is necessary to train qualified personnel, improve the selection, the honey base. Also relevant is the question of increasing the collection of honey from each hive. This will lead to a reduction in production costs, increasing its export potential,” the head of the association Badraddin Hasratov said.

According to the estimates of the Ministry of Agriculture, the honey volume in the country makes it possible to increase the number of bee colonies by at least 5 times, and productivity - by 2-3 times. However, to do this, it is necessary to increase the productivity of bee colonies, expand preferential loans to the industry, increase the number of breeding beekeeping farms, expand the steps for promoting and advertising beekeeping products abroad, solve problems with packaging and quality control of honey.

Government subsidies and concessional financing of domestic beekeeping are extremely important steps, as farmers engaged in this field are very dependent on weather conditions. “We expect that by the end of 2018, honey production in the country will reach 3 thousand tons or more: these are preliminary forecasts, since the process of producing honey is not yet fully completed in some regions,” said B. Hasratov. According to him, the association had previously predicted honey production at 5,000 tons this year, but the cold spring and the subsequent warming prevented the flowers from extracting the required amount of pollen and nectar, which led to a noticeable reduction in honey collection by bees. It was possible to keep the volumes at last year’s level only due to the fact that in a number of regions of Aran and the southern region of the country a very high yield was observed, in places from each bee colony they took up to 50 kg of honey.

Some experts believe that in order to avoid losses due to natural disasters, beekeepers need state support against the risk of crop failure. Equally important is the provision of technical assistance to wild-beekeeping farms to ensure transportation of highly productive bee colonies to Azerbaijan and adapting them to local conditions.

According to Vugar Huseynov, although today highly productive breeds of bees are imported to Azerbaijan from abroad, especially from Germany, but these supplies are not regulated by the state, and all the work is done by the beekeepers. However, they are not able to bring many bee colonies, since bees are very sensitive to transportation, and it is necessary to solve the problem of their adaptation to local conditions.

The most important factor contributing to the development of beekeeping and the growth of honey sales in Azerbaijan is the holding of annual honey trade fairs. They help farmers to promote their products in the capacious capital market. So, the trade fair held in October 2018 was attended by 371 beekeepers selling 120 tons of selected honey and other beekeeping products - bee milk, pollen, propolis, etc.

Recently, a number of honey fairs and sales have been held in a number of regions of Azerbaijan, as well as during shopping festivals, which certainly contribute to the popularisation of domestic beekeeping products among tourists and guests of Azerbaijan, indirectly stimulating export trends.