Household chemicals (Russian market)

FMCG market in Russia (consumer goods)

Main article: FMCG market in Russia (consumer goods)

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2024: Construction in the Astrakhan region of the first Iranian plant for the production of household chemicals in Russia

In the Astrakhan region, the first plant of the Iranian company Golrang Industrial Group for the production of detergents was built in Russia. This became known in early December 2024. The plant was built in the special economic zone "Lotus" of the Astrakhan region. The company received regional state support for the purchase of equipment. Read more here

2023

Control by Russians 95% of the domestic market for laundry products

At the end of 2023, the share of Russian products in the market of washing powders and liquid laundry products in the Russian Federation reached 95%. For comparison, in 2019 this figure was estimated at 93%. Industry trends are addressed in the BusinesStat survey published in early December 2024.

The study takes into account products such as gels, capsules and washing powders. The list of leading enterprises in the industry includes Lab Industries LLC, Procter End Gamble-Novomoskovsk LLC, Faberlik JSC, Nefis Cosmetics JSC, Synergy LLC, etc.

It is said that the import of laundry products to Russia is minimal: moreover, in 2019-2022 it decreased annually, and its share decreased from 7% to 4%. The decrease in import supplies was due to the desire of international corporations such as Henkel and Procter & Gamble to localize production in Russia. As a result, the share of domestic products rose during the specified period from 93% to 96%.

In 2022, against the backdrop of a worsening geopolitical situation, the production of laundry products in Russia decreased due to restrictions on the activities of international corporations, which refused advertising, investment and partially cut the range of manufactured goods. In addition, Russian production itself depends on imported raw materials, which in some companies reaches 50%. The severance of trade relations with suppliers and difficulties with international payments also negatively affected the volume of washing products in 2022.

At the same time, investments in the household chemicals industry by Russian companies have increased. In 2022-2023, several large projects were implemented, including an increase in the production capacity of washing gels of Nefis Cosmetics JSC, the installation of a new production line for the production of washing powder and the launch of the production of granular washing powder of Bionix LLC, etc.^[1]

Household chemicals production in Russia increased by 1.6% and reached 3.31 million tons

In 2023, the production of household chemicals in Russia reached 3.31 million tons. This is 1.6% more than in 2022, when 3.25 million tons of these products were produced in the country. Market trends are addressed in the BusinesStat survey published in mid-October 2024.

The study takes into account deodorants and flavors for air, polishing agents, household soap, as well as products for kitchen and plumbing, washing dishes, glasses and mirrors, washing, car care, care for shoes, clothes and fabrics, etc. Significant players in the industry are Lab Industries LLC, Unilever Rus LLC, Procter and Gamble - Novomoskovsk LLC, Faberlik JSC and Nefis Cosmetics JSC.

According to estimates, in 2019, 3.05 million tons of household chemicals were produced in the Russian Federation. A year later, an increase of 8.3% was recorded - to 3.3 million tons, and in 2021 the increase was another 7% with a final result of 3.53 million tons. However, in 2022, against the background of a worsening geopolitical situation, there was a drop of 7.9%.

The study says that a significant part of the Russian market is controlled by multinational companies that have their own production sites in the country. In 2022, Henkel, Unilever, Procter & Gamble, Reckitt Benckiser decided to reduce their presence in the Russian Federation: they abandoned advertising, investments in Russian business and reduced the range of manufactured goods. In addition, domestic production of household chemicals is highly dependent on imported components and components, primarily from Europe. Due to sanctions and the departure of foreign suppliers, domestic manufacturers of household chemicals faced a shortage of surfactants for detergents and washing agents, as well as polyethylene, polypropylene, paints and plastic. However, already in 2023, the production of household chemicals in Russia began to recover.^[2]

Sales growth of air fresheners by 19% to 46.9 thousand tons

In 2023, retail sales of air fresheners in Russia reached 46.9 thousand tons. The growth compared to the previous year, when about 39.3 thousand tons of these products were sold, amounted to 19.3%. The positive dynamics is due to deferred domestic demand and the restoration of imports, as stated in the BusinesStat study, the results of which were published on February 29, 2024.

The published statistics take into account sales of products such as aerosols, gels, deodorants, diffusers, odor absorbers, candles and sprays (interior perfumes). Among the significant market players are called Faberlik, Synergetic, Arnest, Sibiar and Aerosol Novomoskovsk.

According to estimates, 45.3 thousand tons of air fresheners were sold on the Russian market in 2019. In 2020, retail sales of these products decreased by 9.6% - to 40.9 thousand tons. Under the influence of the COVID-19 pandemic, demand was redistributed to disinfectants. In addition, in the Russian Federation there is a general trend towards the use of environmentally friendly and natural products: consumers often choose alternative methods of cleaning and refreshing air, for example, the use of essential oils. Because of this, sales of traditional fresheners are falling.

In 2021, due to deferred demand, the volume of sales increased by 3.5%, amounting to 42.4 thousand tons. And in 2022, amid a decrease in the solvency of the population and a sharp increase in product prices amid a worsening geopolitical situation, sales of fresheners decreased by 7.2%, amounting to 39.3 thousand tons. Buyers preferred to reduce the volume of purchased funds or switch to cheaper ones. In particular, many consumers refused to purchase automatic sprayers in favor of less expensive products.^[3]

2022

In Russia, sales of bleach and stain remover decreased by 2.6% - to 72.5 thousand tons

The volume of the Russian bleach and stain remover market in 2022 amounted to 72.5 thousand tons, which is 2.6% less than a year earlier, when sales of these products were measured at 74.4 thousand tons. This is evidenced by the data that BusinesStat analysts released in December 2023.

The bulk of the demand in the market under consideration falls on bleaches - their sale in Russia in 2022 reached 59.5 thousand tons. Sales of stain remover amounted to 13 thousand tons.

At BusinesStat, bleaches were divided into three main species depending on their composition: chlorine-containing, oxygen and optical. The use of bleach and stain remover has become more frugal, with customers preferring to reduce purchases or switch to cheaper funds.

According to experts, one of the reasons for the increased demand for bleach and stain remover was the COVID-19 coronavirus pandemic. Chlorine-based cleaning products have begun to be used to wash and disinfect surfaces. Chlorine-containing bleaches are commonly known as "whiteness." Such funds are produced in Russia and are offered at relatively low prices.

According to the study, sales of bleach and stain remover in Russia in 2022 decreased against the background of a decrease in the solvency of the population, a sharp increase in product prices and a decrease in the need for disinfectants against the background of stabilization of the epidemiological situation. In 2021, sales of bleaches and stains decreased by 0.3% amid the high base of pandemic 2020. In 2021, the epidemic situation with the coronavirus began to gradually stabilize, and the population still had stocks of bleach and stain remover made during the period of rush purchases in 2020.^[4]

Reduction in the production of dishwashing products by 3% to 766 thousand tons.

At the end of 2022, the production of dishwashing products in Russia decreased by 3% compared to the volume of one year ago - from 789 thousand to 766 thousand tons. This is evidenced by data from the analytical company BusinesStat, published in December 2023.

According to the study, the production of dishwashing products in the Russian Federation has decreased largely due to the departure of foreign manufacturers. Most of them announced either the termination of work and the sale of assets to local buyers, or a reduction in output, with the exception of essential goods. For example, in March 2022, Procter & Gamble announced the suspension of investment and marketing activity, a reduction in product supplies to Russia and a significant reduction in the product portfolio at its plant in Novomoskovsk. In addition, Henkel announced its complete withdrawal from the market and the sale of its Russian assets.

Another problem for the Russian dishwashing market is that domestic companies are faced with a shortage of surfactants and other chemicals for the production of household chemicals due to the cessation of supplies by the largest foreign manufacturers (BASF, Clariant). It was not immediately possible to establish stable supplies of raw materials, analysts say.

According to their forecasts (the study was published in December 2023), in the coming years, the production of dishwashing products in Russia will grow as demand for products recovers. Taking advantage of the general uncertainty in the market, domestic manufacturers will increase their market share and expand the range. The state is also interested in the development of domestic production: for example, in July 2023, high customs duties were established on the import of detergents and cleaning products from "unfriendly" countries.^[5]

Russian companies oust imported washing powders

In 2022, 22.9 thousand tons of washing powders and liquid laundry products were imported from abroad to Russia, which is 34.6% less than a year earlier. The decline was due to the departure of some foreign manufacturers, which Russian companies began to use - in 2022 they increased production.

In 2022, shipments of washing powders from the United States were suspended (in 2021, the range was presented by the Amway trademark), laundry gels from Belgium, and laundry capsules from Serbia. In the conditions of a record reduction in the supply of washing products to Russia by Western partners in 2022, companies from Belarus quickly increased shipments of relatively cheap products to the domestic market. The share of supplies from this country soared almost 4 times: from 19.9% to 76.1%, partially compensating for the fall in imports of household laundry chemicals to Russia in 2022. The main range of products was occupied by the lines of brands "Seagull" and "Mara" from LLC "Perfume and Cosmetic Factory" Sonza. "

The Volgograd company Bionics noted a significant increase in demand for washing powders and dishwasher products and in 2022 announced its intention to increase their production 2.5 times, to 5,000 tons per month.

In addition, the BSK group tripled the production of Zifa and Luch detergents, and also announced the launch of an updated line of powders for children's linen on the market already.

According to experts, household laundry chemicals are essential goods and are included in the standard consumer basket, which ensures stable demand in the industry. The availability of the latest household appliances, the development of the market of cleaning services and dry cleaning laundry in the country also contribute to an increase in the consumption of detergents.^[6]

Imports of household chemicals to Russia decreased

In 2022, 312.2 million household chemicals were imported to Russia, which is 9.4% less than a year earlier. This is stated in a study by the analytical agency BusinesStat, which was released in May 2023.

According to the researchers, after the start of the special operation in Ukraine, a considerable number of multinational companies limited cooperation with Russian enterprises until the foreign policy situation normalizes. Procter & Gamble, Unilever, Kao Group reduced supplies, reduced the range and suspended advertising and investment activities in Russia. The German concern Henkel decided to leave the country and sold the Russian business to local investors.

Imports of household chemicals to Russia decreased over the year

The largest drop in imports of household chemicals in the Russian Federation in 2022 was noted in the following areas: Italy (by 33.8 million units), Germany (by 25.4 million), Britain (by 23.8 million), France (by 22.5 million). At the same time, supplies from Turkey (by 34.4 million units), Poland (by 24.2 million) and China (by 13.5 million) increased significantly. Probably, the supply of household chemicals from Turkey against the background of a reduction in imports from the EU will only grow, experts say. Firstly, Turkey offers a fairly wide range of high-quality local household chemicals (TM ABC, Bingo, Doa, Kalyon, Peros, Seba). In addition, factories of international giants P&G, Henkel, Reckitt, Unilever operate here. Secondly, Turkey remains neutral in the situation around Ukraine.

Thirdly, Turkey's undeniable advantage as a trading partner of Russia is convenient logistics: mainly goods are transported by sea. Novorossiysk There is a powerful seaport with a throughput of over 200 million tons per year, so delivery takes no more than 7 days. In addition, transportation by sea is quite economical in comparison with other types of cargo transportation, the study says.^[7]

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