Confectionery (Russian market)

Export of confectionery products from Russia

Main article: Export of confectionery products from Russia

Chronicle

2023

Imports of chewing marmalade in Russia decreased by 11.4% to 7.1 thousand tons

In 2023, the import of chewing marmalade to Russia amounted to about 7.1 thousand tons. This is 11.4% less compared to 2022, when the volume of import of these products was estimated at 8.1 thousand tons. Such figures are given in a study by BusinesStat, the results of which were published in mid-September 2024.

The industry in question is said to be showing sustained negative dynamics. Despite the lack of direct sanctions on the import of European sweets, individual companies voluntarily left the Russian market. So, suspended supplies to Russia. Haribo Importers also encountered difficulties in purchasing products from Hungary,,. Spain Czech Republic

According to estimates, in 2019, 17.7 thousand tons of chewing marmalade were imported to the Russian Federation. In 2020, a decline of 27% was recorded - up to 12.9 thousand tons. In 2021, there was a decrease in purchases by 0.1%, and in 2022 - by another 37.7%. Thus, in general , from 2019 to 2023, the import of chewing marmalade to Russia decreased by 59.7%.

The authors of the report say that the key factor in the fall in imports in 2020 was the restrictions and imbalance of supply chains amid the COVID-19 pandemic. In 2022-2023, the situation worsened due to sanctions from Western countries and a sharp increase in transport costs. For 2019-2023, the turnover of chewing marmalade imports to Russia decreased by 36% - from $35.7 million to $22.9 million. The main impact on the reduction in value imports was caused by a sharp drop in the natural volume of supplies in 2020 and 2022. At the same time, the price of chewing marmalade imports to Russia increased by 59% - from $2.02 to $3.21 per kilogram. Due to the weakening of the ruble, imported relatively cheap products of the mass segment were supplanted by the Russian one, while more expensive sweets retained their position in the market, increasing the average price by category as a whole.^[1]

Sales of gingerbread in Russia decreased by 9.7% to 149 thousand tons

In 2023, 149 thousand tons of gingerbread were sold on the Russian market. This is 9.7% less than in the previous year, when sales were estimated at 165 thousand tons. The drop is partly due to a change in consumer preferences. This is stated in a study by BusinesStat, the results of which were published on August 21, 2024.

Analysts take into account the sales of gingerbread with and without filling (chocolate, mint, ginger, fruit, vanilla, cocoa), as well as similar gingerbread products and rugs. Among the leading players in the industry under consideration in the Russian Federation are named KDV Yashkino LLC, Rot Front OJSC, Khlebny Dom LLC, Limak JSC and New Technologies LLC. The dominant positions in the Russian market are occupied by domestic gingerbread products. Local companies almost completely satisfy domestic demand, and the share of foreign products does not exceed 1%.

According to estimates, 191.1 thousand tons of gingerbread were sold in Russia in 2019. In 2020, a drop of 10.6% was recorded - to 170.8 thousand tons. In 2021, an increase of 2% was noted with a final result of 174.3 thousand tons. But in 2022, another decline followed: consumption decreased by 5.3% - to 165 thousand tons. In general, from 2019 to 2023, sales of gingerbread in Russia decreased by 22%.

The authors of the report attribute the observed trend to the redistribution of customer demand towards newer and (or) more popular sweets: chocolate, cookies, cakes and other flour products of non-food storage, as well as snacks and healthy products. Such products are widely represented on store shelves, and their assortment is constantly replenished. On the other hand, carrots, as a traditional product, are less diverse and adaptive. Analysts call the reduction in the share of citizens older than working age, for whom carrots remain the usual budget addition to tea drinking, another factor in the decline in sales.^[2]

Decline in biscuit sales by 0.3% to 768.3 thousand tons

In 2023, sales of sweet cookies in Russia amounted to 768.3 thousand tons. For comparison, in 2022, the volume of sales of these products was estimated at 770.6 thousand tons. Thus, a decline of 0.3% was recorded, as stated in the BusinesStat review, published in early August 2024.

The published data take into account the sales of cookies of various types - sugar, with filling, oat, poultry, dietary, cereal and multi-varnish, waffle, puff, etc. Among the major players in the industry are named Mars LLC, Mon'Dalis Rus LLC, KDV Voronezh LLC, Essen Production AG JSC, Rot Front OJSC, etc.

According to estimates, in 2019, 688.5 thousand tons of sweet cookies were sold in Russia. In 2020, sales rose 2.1% to 703 thousand tons. In 2021, the result was shown at 738.1 thousand tons, which is 5% more compared to the previous year. Against the background of the lifting of some of the restrictions imposed in the context of the COVID-19 pandemic, sales of confectionery products as a snack on the go and at lunchtime increased. In addition, they began to restore the activities of the catering enterprise. There was an increase in the popularity of mobile points of sale, small cooking, as well as a bakery cafe with a wide range of inexpensive confectionery products, including sweet cookies.

In 2022, the demand for products increased by another 4.4%, but then a decline followed. The reduction in sales volumes in 2023 was recorded in the retail segment and in the catering sector. This is primarily due to the continuing rise in product prices. So, in 2023, the cost of sweet cookies increased by 8.8%.

Among the main trends in the market under consideration, BusinesStat analysts name: the growth in demand for packaged sweet cookies in a small package, a decrease in sales for weight, the development of an online channel and the expansion of the healthy eating segment. In addition, there is a "complication" of products by combining several types of confectionery into one: for example, waffle cookies, cookies with a layer of meringue, marshmallows or marmalade.^[3]

Growth in sales of bakery and flour confectionery products to 7.74 million tons

In 2023, sales of bakery and flour confectionery products in Russia reached 7.74 million tons. For comparison, a year earlier, the volume of sales was estimated at 7.7 million tons. Thus, growth was recorded at 0.4%. The domestic market is close to saturation, as stated in the materials of BusinesStat, published in mid-February 2024.

In 2019, sales of these products were estimated at 7.87 million tons. In 2020, there was a drop of 3.4% - to 7.6 million tons. The COVID-19 pandemic has reduced the real disposable income of buyers, who, in order to save money, were forced to cut costs for goods that are not part of the mandatory consumer basket. In addition, many catering establishments were closed or suspended.

In 2021, sales of bakery and flour confectionery products in the Russian Federation rose by 0.6% on an annualized basis - to 7.65 million tons. Citizens began to return to the usual rhythm of life, and enterprises began to resume activities. In 2022, consumption increased by another 0.7% with a final result of 7.7 million tons. The study says that bakery products, primarily ordinary bread, are the foundation of army rations. Against the background of the formed geopolitical situation, a significant part of the efforts of manufacturers was aimed at meeting the needs of the army, and the volume of purchases for the public sector in 2022 increased by 7.5% compared to 2021.

In 2023, a gradual stabilization of the economic situation was observed. This led to a moderate recovery of the catering sector, and food supplies for the needs of the army and other government agencies continued to grow. For the vast majority of consumers, bakery products remain the basic element of the diet, regardless of the situation on the market.^[4]

2022

8.1% increase in sales of chocolate and cocoa products to 1.16 million tons

The volume of the Russian market for chocolate and cocoa products in 2022 reached 1.16 million tons, which is 8.1% more compared to the previous year, and compared to 2018, sales of these products increased by 13.7%. Such data are provided in a study that the analytical agency BusinesStat published in December 2023.

According to experts, the growth in sales of chocolate and cocoa products in 2022 was facilitated by the perception of their consumers as a useful treat due to the high percentage of cocoa beans. In addition, chocolate remains one of the most pleasant and affordable ways to improve mood and reduce stress levels, experts say.

In the period from 2018-2020. the Russian market for chocolate and cocoa products showed a decline only in 2020 (by 6.2%), when the COVID-19 coronavirus pandemic led to low population mobility and the closure of catering establishments. As a result, the demand for sweets then decreased.

In the remaining years, the period 2018-2022. sales of chocolate and cocoa products showed steady positive dynamics. The growth of the market was stimulated by the constant addition of the assortment by manufacturers with new tastes and packaging options, increased marketing activity by market participants, as well as an acceleration of the rhythm of life, in which people increasingly purchase sweets as a snack on the go and at lunchtime, the study notes. It takes into account sales of the following products:

• cocoa powder (with sugar);
• chocolate or chocolate glazed candy;
• chocolate (except white chocolate);
• chocolate glaze;
• chocolate paste;
• chocolate eggs with filling, solid and hollow chocolate figures and others;
• cocoa confectionery.^[5]

Decrease in sales of marmalade by 0.4% to 25.2 thousand tons

In 2022, 25.2 thousand tons of chewing marmalade were produced in Russia. This is 0.4% less than the volume of production a year ago. BusinesStat analysts spoke about the market situation in their study, which was released in October 2023.

According to the report, the production of chewing marmalade in the Russian Federation at the end of 2022 compared to 2018 increased by 15.4%. In 2020-2021. amid the weakening of the ruble, the import of chewing marmalade fell sharply, and domestic producers increased production volumes to occupy the vacant niche. As a result, in 2021, the release of chewing marmalade reached its peak value in five years - 25.3 thousand tons.

The sanctions crisis, which came after the start of the Russian military special operation in Ukraine, had a limited impact on the chewing marmalade market, BusinessStat said. Large manufacturers quickly adapted to the changed conditions, worked out new supply chains and established supplies of raw materials. Moreover, the departure from the Haribo market and the limited availability of marmalade of other foreign brands opened up new prospects for domestic companies. They expanded the assortment, supplemented it with new tastes, forms, focusing on the naturalness of the components and compliance with the current trends in healthy eating, which was a distinctive feature of European products.

So, in 2022, Union Group began production of chewing marmalade with natural juice. The Perm Confectionery Factory also headed for import substitution. In December 2022, the company applied for the trademark "Valera Bear," under which, according to media reports, it is planned to produce chewing marmalade in the form of cubs, reminiscent of Haribo.^[6]

Reduction in sales of sugar products by 4.4% to 662 thousand tons

In 2022, 662 thousand tons of sugar confectionery products were sold in Russia, which is 4.4% less than a year earlier. At the same time, in 2021, the market volume grew by 8.5%, analysts at BusinesStat, whose data were published in June 2023, calculated.

According to experts, the deterioration in the well-being of Russians prompted them to follow a rational consumption model: reduce spending on goods that are not part of the mandatory consumer basket, or buy better and more nutritious products in smaller quantities. It is worth noting that in 2022 the consumption of only sugar products decreased, sales of chocolate and flour confectionery products grew. Sweets are often used as a means to boost mood, relieve stress and anxiety.

662 thousand tons of sugar confectionery products were sold in Russia

As noted in BusinesStat, the decline in sales of sugar products in 2022 was also influenced by a narrowing of the range of sweets due to restrictions on the activities of the largest foreign producers in Russia. For example, Mondelez, Nestle, Ferrero suspended advertising and investments in Russian business and stopped importing their sweets into the country.

Imported products occupy about 11% of the Russian market for sugar products. In 2022, imports amounted to 79.6 thousand tons, which turned out to be at the level of 2021. The supply of sugar confectionery products from China and Turkey has grown significantly. Also among the major supplying countries were Kazakhstan, Germany and Belarus. Among all types of imported saccharine products, marmalade, fruit pastille, is the most popular.

The researchers add that in 2022, the demand in the confectionery market gradually shifted towards other sweets: dietary products with a natural composition, chocolate products, flour pastries with an original recipe.^[7]

Sales growth of 1.9% to 3.65 million tonnes

In 2022, 3.65 million tons of confectionery products were sold in Russia, which is 1.9% more than a year earlier. In the period from 2018 to 2022. The market showed stable growth, except for 2020, when sales decreased by 4.5%. This is evidenced by the data of the analytical agency BusinesStat. The study was published in May 2023.

According to the BusinesStat report, in 2022 the Russian confectionery market was close to saturation, its dynamics depends on the level of income of the population, changes in consumer behavior, and the actions of encouraging factors for sales growth. Stable demand was supported by the development of retail chains with a rich range of sweets on offer at affordable prices, the application of various incentive promotions and marketing activities, the expansion of chains of small coffee shops and bakeries, mobile points of sale, constant search and supply by manufacturers of new tastes and types of sweets.

In conditions of instability in 2022, Russians tried to "treat" themselves and loved ones with various sweet products. The sale of chocolate and other cocoa confectionery products has significantly increased: despite the high cost, chocolate products remain popular, perceived as a more useful treat. In 2022, among all types of flour confectionery, sales of sweet, dry cookies and gingerbread products increased: these categories belong to the products of the low price segment and often serve as an alternative to expensive sweets. At the same time, the consumption of saccharine confectionery products, as well as expensive flour products (cakes and cakes), has decreased, the researchers note.

For 2018-2022 imports of confectionery products to Russia increased by 22.1% - from $965.4 to $1.18 billion. A decrease compared to the previous year was noted only in 2020 - by 6.7% - as a result of a decrease in both the natural volume of supplies and the average import price.^[8]

Notes