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Retrieving Russian Economy to Witness a Slow Growth in the Beverage Sector: Ken Research

Russia’s economic situation is affecting the beverage sector because consumers are spending more on affordable beverages. The ever growing population in Russia is one of the major factors for growth in the affordable beverage sector. The living standards in Russia declined due to consumer’s lower spending limit. The lower income group and middle income group have economized. However, the poverty level in the country is growing and the population is looking for ways to save their money. Health awareness continues to influence consumer’s beverage consumption choices. Russian government is providing generous subsidies to boost domestic production of beverages, to reducing imports and become more competitive.

According to the study “Russia Beverage Forecasts March 2017”, it was observed that there is a decline in the consumption of beer in Russia due to price and it has led to the growth in regional inexpensive beer brands. Beer advertising is only permitted during sports in television and radio programmes. Currently, beer advertising is continuing due to the FIFA World Cup that would be held in Russia in the year 2018. Baltika Pivovarennaya Kompaniya is the leading competitor of beer in Russia. Baltika has introduced new non/low alcohol beer with brand name Zatecky Gus attracting the consumer’s who are interested in non/low alcohol beer. The production capacity is increasing due to its great demand for non/low alcohol beer.

The sale of cider/perry has increased drastically in the recent years due to boom in domestic cider production and availability of cider/perry in modern retailers. Young population are attracted towards the cider/perry which is a natural low alcohol drinks compared to beer. Baltika Pivovarennaya Kompaniya is the leading producer of in Russian cider/perry with a large distribution chain. Russia passed laws stating that domestically cider/perry is categorized as an agricultural product similar to wine.

United Bottling Group is the leading manufacturer of RTDs or high-strength premixes in Russia. The country has banned sales of high-strength premixes or RTDs containing caffeine and taurine that have energising effects. The growth of wine-based ready to drink beverages in Russia has witnessed a low growth in the past years but there is a demand for wine based RTD’s due to offers, increasing number of female consumers and no limitations on sales. Russian health committees state that alcohol combined with caffeine and other stimulant have a great impact on the central nervous system in a human and has dangerous health effects. It was observed that the spirit-based RTDs are predicted to decline over the coming years. The wine category in Russia is highly fragmented due to many players. The leading players in the wine category are Kuban-Vino OOO, Igristye Vina ZAO, MZVV OOO, Viktoria TD OOO and Fanagoriya APF OAO. The leading player in Russian sparkling wine is Abrau-Durso JSC.

Vodka category has stagnated in Russia due to its illegal sales. The increased availability of economy vodka in Russia has supported the legalisation process of vodka’s sales in the recent years. Tatspirtprom OAO, Synergya OAO are the leading competitors in the spirits category. Tatspirtprom has significantly increased the distribution of vodka brands such as Russkaya Valyuta and Xanskaya. Russian reviving economy and rising cafe culture are the major factors affecting the hot drink beverages sector, where hot drinks are hot coffee, hot tea and hot chocolate drinks. Hypermarkets, supermarkets, convenience stores, food & drinks specialists, e-Retailers and others account for the majority share in the distribution of hot drinks. Orimi Trade, Princess Gita, Ahmad Tea and Nestle are the leading players in the Russian hot drinks sector.

Consumption of soft drinks in Russia has decline due to price and consumers’ demanding for better products. Bottled water, popular soft drinks, sports and energy drinks and RTD coffee witnessed a growth while the growth other variants of soft drinks continued to decline. The juice and RTD tea category has remained weak due to the significant price increase. The soft drinks category includes Asian speciality drinks, bottled water, carbonates, concentrate juice, juice, RTD coffee, RTD tea, sports and energy drinks. Energy drinks category remained highly immature and has registered a slight growth in the recent years due to the wide distribution and consumer awareness. Dairy drinks, soy drinks, milk alternatives such as condensed milk, drinking yogurt, fermented milk, flavoured milk, grain nut rice and seed milk alternative drinks, soymilk, white milk are few other beverages available. It was observed that there is a minimal growth of these products in the Russian Beverages Market.

Many new laws regulating Russian beverages market were imposed in the past year. The major concern is the excise duty rates and usage of PET (Polyethylene terephthalate) for alcoholic products.  The excise duties on most of alcoholic drinks is raised and on the exported ingredients used for making beverages. Russia bans production and sales of alcoholic products in plastic bottles. Alcoholic drinks category in Russia has declined in terms of volume and sales in the recent years due to decline in consumes’ spending income. The government’s anti-alcohol policy has also reduced the consumer’s purchasing power.

Spirits category in alcoholic drinks has witnessed a marginal decline due to the illegal sales of vodka’s. Cider/perry category has developed dynamically in Russia. Majority of the Russian consumers are demanding for economy products across all categories due to the country’s economic conditions. It was observed that there was a stiff competition across all categories of alcoholic drinks. The domestic companies are actively developing and collaborating with international giants. The small independent players in Russia are dynamically developing in the beer sector. Many domestic players in wine category are gaining momentum and enjoying the Russian legislative privileges of low excise tax. The imported brands in spirits, RTD’s and cider/perry are witnessing a decline of imported brands due to their price. Grocery retailers are the leading distributors of alcoholic drinks in Russia along with the development in the alcohol speciality stores. These alcohol chain outlets offer alcoholic beverages at affordable prices and convenient locations. The alcoholic beverages market in Russia is expected to witness a continuing decline over the coming years due to less demand, slow recovery of spending incomes and increasing excise tax.

Key Topics Covered in the Report:

Russia Naturally Healthy Beverages Market Research Report

Russia Naturally Healthy Beverages Market Size

Russia Non Alcoholic Beverages Market

Russia Non Alcoholic Beverages Import Volume

Russia Non Alcoholic Beverages Export Volume

Russia Naturally Healthy Beverages Market Future Outlook

Russia Healthy Beverages Market Competition

Russia Beverages Retail Market

Russia Juice Market Demand

Russia Coconut Water Demand

Beer Market Research Report Russia

Alcoholic Beverages Market Russia

Russia Juices Market Revenue

Soy Milk Consumption Russia

Wine Consumption Russia

Russia Non Alcoholic Beverages Market Competition

Russia Non Alcoholic Beverages Market Future Outlook

To know more, click on the link below:

https://www.kenresearch.com/food-beverage-and-tobacco/alcoholic-beverages/russia-beverage-forecasts/136460-11.html

Related Reports:

https://www.kenresearch.com/food-beverage-and-tobacco/food-services/uae-coffee-chain-market/142280-11.html

https://www.kenresearch.com/food-beverage-and-tobacco/alcoholic-beverages/venezuela-beverage-forecasts/136473-11.html

Contact Us:

Ken Research

Ankur Gupta, Head Marketing & Communications

[email protected]

0124-4230204



This post first appeared on Research News Today: Press Release Submission Site, India Global, please read the originial post: here

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