Production of Starch and Starch Derivatives

Another investment business opportunity supported by the Georgian government is the production of starch and starch derivatives, as we said in the previous article, the Georgian government has a strong investment offer for investors, it has a liberal and free-market-oriented economic policy, access to a 2.3 billion consumer market through its solid FTA network including both EU and China, educated, skilled, and competitively priced workforce, 6 types of low and flat taxes, significantly decreased the number of licenses and permissions, well developed, integrated and multimodal transport infrastructure.

Production of Starch and Starch Derivatives

The world market for industrial starch has reached 90 million tons in 2015. The CAGR forecast for upcoming
years is 3.8% and by the year 2022, the market will reach $100 billion (120 million tons). The demand for starch
derivatives has been growing strongly for many years. Particularly, the popularity of gluten is increasing, mainly
due to its broad applications in the food industry. During the last 5 years, gluten consumption has increased
by 22%. Low-quality wheat is used to produce starch and starch derivatives. In Georgia, 50% of locally
produced wheat is low quality thus can’t be used as a food additive and can only be used as a raw material in
this production process.

The project aims to establish an enterprise in western Georgia that will produce starch and starch derivatives.
The factory will use low-quality wheat as raw material and produce natural starch, modified starch, gluten, and
animal feed. Annual sales will be approximately USD 50 million; the enterprise will employ over 350 employees
and supply the world market with high-quality, competitive products. Currently, there is no similar production in
Georgia. Launching this project will also motivate local farmers to produce wheat.

Project Highlights:
Location: Poti, western Georgia
Final products: Natural starch/ Modified starch/ Gluten/ Animal feed
Target market: Turkish, Indonesian, and Russian markets

Annual production quantities: 
Natural starch: 2,040
Modified starch: 3,000
Gluten: 810
Animal feed: 6,330

Financial Highlights:
Total investment: $ 79 million
10-year NPV: $ 57.9 million
Payback period: 3.1 year
10 year IRR:  30%

To get more information about the best investment oppurtunities please do not hesitate to contact our consultant in Avageorgia.ge and Get in touch with us.