Export and import of alcoholic beverages in Russia

Russia's Foreign Trade

• Russia's Foreign Trade

2023

Imports of raw materials for brandy to Russia for the year soared by 36.6% to 27.3 million liters. Leading countries

In 2023, 27.3 million liters of cognac distillate were imported to Russia (including raw materials for brandy). This is 36.6% more than in the previous year, when the volume of imports of these products was 20 million liters. Such data are given in the BusinesStat study, the results of which were released in early October 2024.

According to estimates, in 2019, the import of cognac distillate to Russia was at around 13.9 million liters. In 2020, a reduction of 52.2% followed - up to 6.6 million liters. Against the backdrop of the COVID-19 pandemic, there was a sharp decline in international trade activity. As a result, supplies from Azerbaijan and Latvia stopped, and imports from Spain and Uzbekistan were reduced to a minimum . In 2021, an increase of 20.1% was recorded with a final result of 7.9 million liters, and in 2022 there was an increase in imports by 151.6%.

Due to the current geopolitical situation, many cognac brands left Russia, including Remy Martin, Martell, Hennessy, etc. Domestic producers hastened to occupy the vacant niche, but they faced a shortage of raw materials. This led to a significant increase in purchases abroad. In order to increase the output of distillate from domestic grapes, it is necessary to significantly increase the area of ​ ​ vineyards. But this can take a relatively long time. In addition, the demand for raw materials from winemakers is growing.

In 2023, Armenia 10.3 million liters of products, or 37.8% of total imports, became the leading supplier of cognac distillate to Russia. In second place is France with 7.3 million liters, which corresponds to 26.7%. Of Kazakhstan the delivered 5.6 million liters, or 20.5%. Georgia 2.6 million liters of cognac distillate were imported from it - about 9.5%. The total supply from all other countries amounted to 1.5 million liters.^[1]

1.6% drop in alcohol imports to 978.9m litres

In 2023, the volume of alcohol imports to Russia amounted to approximately 978.9 million liters. This is 1.6% less than in 2022, when the figure was estimated at 994.6 million liters. Such data are given in the BusinesStat review, published on July 29, 2024.

The study considers various types of products: wines, vodka and distilleries, cognac and wine drinks, beer and beer drinks, as well as other strong ones (whiskey, rum and tafia, gin and juniper tincture, tequila, alcohol tinctures) and low-alcohol (cider, poiret and mead) drinks. According to estimates, in 2019, about 921 million liters of such products were delivered to the Russian Federation. In 2020, an increase of 6.4% was recorded - to 979.9 million liters, and in 2021 the increase was another 15.7% with a final result of 1133.6 million liters.

However, in 2022, against the background of a worsening geopolitical situation, a decline was recorded at the level of 12.3% - up to 994.6 million liters. In connection with the sanctions, many foreign manufacturers refused to supply products to the Russian Federation. In particular, Global Spirits and Brown-Forman revoked the distribution license for goods, and alcohol companies Diageo and Pernod Ricard suspended supplies. Czech breweries Budweiser Budvar, Pilsner Urquell and Staropramen also announced the termination of shipments of their products to Russia. In addition, a similar decision was made by the Champagne Winemakers Union.

In November 2022, the Ministry of Industry and Trade included alcohol in the list of goods for parallel imports: the list included about 40 brands. But, as stated in the BusinesStat study, in fact, almost all brands of foreign alcoholic beverages began to be imported into the Russian market, thanks to which the pace of decline in imports slowed down. In general, from 2019 to 2023, the import of alcoholic beverages to Russia rose by 6.3%.^[2]

Kazakhstan became the largest importer of Russian vodka

Kazakhstan became the largest importer of Russian vodka in 2023: during this period, the Russian Federation delivered this alcoholic product abroad in the amount of $59.7 million. Of this amount, almost half - $27.9 million - fell on Kazakhstani buyers. This was reported on May 11, 2024 by RIA Novosti with reference to open statistics.

The agency's publication says that imports of Russian vodka to Kazakhstan in 2023 decreased by 26%. In addition, the import of Belarusian hot has decreased in Kazakhstan. The decrease in supplies was blocked by an increase in imports from France, Sweden and Ukraine, as well as an increase in its own production.

Kazakhstan became the largest importer of Russian vodka

In 2023, the second place in terms of purchases of Russian vodka rose, Israel which imported this alcohol in the amount of $12 million, which is 42% more compared to 2022.

In the top three, it is also located Armenia with the import of Russian vodka for $4.5 million at the end of 2023. At the same time, during the specified period, the volume of imports decreased by a third.

The leading five in terms of vodka supplies from Russia in 2023 included Georgia ($3.9 million) and Azerbaijan ($3.5 million).

According to RIA Novosti, in 2022 the export of Russian vodka was significantly higher and reached $141.7 million. However, in 2023, Europe imposed a ban on Russian vodka as part of anti-Russian sanctions, and the largest consumers of this drink - Latvia, Germany and Britain - stopped buying it.

According to Izvestia, in 2023 in the Russian Federation there was a slight slowdown in the rate of production of vodka by manufacturers, which is mainly due to technical reasons. Due to restrictions on the export of Russian products to a number of foreign markets (and the basis of exports is primarily vodka), what was produced earlier for export, as a result, was sent to the domestic market, the publication says.^[3]

Growth in alcohol supplies to Russia from abroad by 6.5% to 102 million decaliters

In 2023, 102 million decaliters (dal) of alcoholic beverages were imported into Russia from abroad, which is 6.5% more than a year ago. The head of Rosalkogoltabakkontrol Igor Aleshin cited such data during his speech at the Federation Council.

According to Interfax, citing Aleshin's presentation, imports of labeled alcohol in Russia in 2023 increased by 5.4% (up to 60 million decaliters), unmarked - by 8% (up to 42 million decaliters).

Alcohol imports to Russia increased by 6.5% over the year

Most of the imported vodka (85.9%) supplied to the Russian market came from. Belarus Another 3.9% delivered, Finland 3.1% Kazakhstan-, 2.9% -, France 1.7% -. Sweden

The leader in the supply of cognac is Armenia (61.7% at the end of 2023). Also 22.5% brought Georgia, 7.4% - France, 2.8% - Spain. More than half of the whiskey imports came to Russia from Britain (53.9%). The United States delivered 13.8%, Ireland - 10.5%.

The five main suppliers of quiet wines to the Russian market in 2023 were Spain (17%), Italy (15.8%), Georgia (15.8%), Portugal (13%) and Abkhazia (10.4%). In sparkling wines, Italy is the leader (70.8%), followed by France (13.4%) and Spain (8.3%).

Most cider in 2023 was supplied by Belarus (68.8%), Britain (10%), France (7.7%), Spain (3.3%) and Belgium (3.3%). As for low-alcohol drinks, in 2023 they were most often imported to Russia from Serbia (41.8%), Italy (30.8%), Spain (18.2%), USA (8.3%), Japan (1.1%).

According to Rosalkogoltabakkontrol, the export of alcoholic beverages from Russia at the end of 2023 decreased by 36.6% compared to the previous year and amounted to 25.1 million decaliters. It is noted that about 85% of Russian alcohol exports are unmarked alcohol.^[4]

Increase in beer imports by 12.6% to 370.5 million liters

In 2023, 370.5 million liters of beer were imported into Russia, which is 12.6% more than a year earlier, but less than the indicators of 2020-2021. This was reported at the end of February 2024 by the Kommersant newspaper, citing data from market participants.

The publication notes that after the start of the Russian military special operation in Ukraine, countries such as Britain, Canada and the United States stopped supplying beer to the Russian market. In the first months of 2023, beer imports to Russia began to recover, but then the dynamics weakened. According to the results of the first half of 2023, shipments of foreign beer to Russia increased by almost 35% compared to the same period in 2022 (to 179.9 million liters), but in the second half of the year deliveries decreased by 2.4%, to 190.6 million liters.

In 2023, 370.5 million liters of beer were imported to Russia

According to Nikolai Zhelagin, founder of the Take the Day Off chain, at the beginning of 2023, retail chains actively made up for the lack of imported beer, and unknown brands issued in Europe were sold for 50-70 rubles per 0.5 liter, but due to the depreciation of the ruble, the competitiveness of inexpensive imports fell. Problems with logistics and the expansion of the assortment of domestic brands have also become a deterrent to beer imports, experts interviewed by Kommersant say. They add that parallel imports have a negative impact on the business of Russian brewers.

In 2023, the most foreign beer to Russia came from Germany (51.7% of total imports), Czech Republic and. Belgium At the same time, the supply of these alcoholic beverages from Mexico (+ 72.6%) and (+ China 84.4%) increased significantly.

The main share of the import of beer into the Russian Federation fell on large retailers and distributors. At the same time, the networks "Red & White," "Bristol" and X5 Group accounted for 44% of beer imports to Russia at the end of 2023^[5]

Named the largest importers of alcohol

According to the results of 2023, imports of wine and strong alcohol to Russia exceeded 520 million liters, an increase of 7% compared to the volume of a year ago. The largest importers of alcohol became known on February 1, 2024.

The five largest importers of alcohol included Kh5 Group (increased supplies by 18 percent, to 44.4 million liters), Bacardi (38 million liters), Bristol and Krasnoye & Beloye (37.9 million liters), developing the Vinlab network Novabev Group (35.8 million liters) and Magnit (plus 83%, increased supplies to 28.5 million liters).

According to the head of WineRetail Alexander Stavtsev, large chains have recently preferred to abandon technical importers in favor of more stable schemes. However, "Red & White" began to develop its imports only in 2023. X5 Group announced an expansion of supplies from various countries, planning to increase imports from Asia and Latin America in 2024. Magnit explained the increase in volumes with a low base in 2022, noting that it sees no prerequisites for further growth in alcohol imports in 2024.

Wine supplies, whose imports from unfriendly countries have been subject to increased duties since August 2023, increased by 1% to 428.4 million liters by the end of 2023. Imports of strong alcohol increased by 45%, to 92.38 million liters, of which about a third (37.4 million liters) is whiskey. The leaders in the import of strong drinks were Johnnie Walker (Diageo) and Jack Daniels (Brown-Forman), which were allowed for parallel imports.

AST CEO Leonid Rafailov says that with the departure from Russia of some of the owners of global alcohol brands, which were the only distributors, the import of such drinks ceased to be structured. Several players are engaged in the supply of the most popular positions at once, which leads to a sharp increase in import volumes and the accumulation of wastewater in some cases, which may be enough for six months or a year, he points out.^[6]

2022

Cognac exports from Armenia to Russia continue to grow

In 2022, 54.2 million liters of cognac were delivered from Armenia to Russia, which is 12.8% more than a year earlier. In comparison with 2018, the export of these alcoholic beverages increased by 85.2%, analysts at BusinesStat calculated. Their data was released in May 2023.

The study says that the main volume of cognac exports from Armenia accounted for the countries of the Customs Union - 95% of supplies on average over a five-year period, while Russia accounted for 79% of total exports. Thus, the increase in the supply of cognac from Armenia was the result of an increase in demand from these countries, experts clarify.

According to them, export growth in 2021 by 26.9% was due to the recovery in the catering sector of the buying countries. In 2022, the growth of supplies continued. This was largely due to major changes in the Russian alcohol market: many European producers of strong alcoholic beverages belonging to the high price segment left it. French cognac brands such as Remy Martin, Martell, Hennessy have disappeared from the Russian market, Scotch whisky producers have almost completely left. There was a shortage, which primarily affected the premium segment of strong alcohol products. One of the measures taken by Russian retail chains to overcome it was the purchase of alcoholic beverages from Armenian producers.

The report also noted that the import of cognac to Armenia is small, supplies are one-time and unstable. In 2018-2022 imports varied within a fairly wide range: from 149.9 to 944.4 thousand liters.^[7]

Imports of tequila decreased by 34%, to 2.34 million liters

Imports of tequila to Russia in 2022 decreased by 34% compared to 2021 and amounted to 2.34 million letters. Such data were released in March 2023.

According to Kommersant, imports of whiskey in the Russian Federation decreased by 52% in 2022, to 18.17 million liters, gin - by 36%, to 1.73 million liters, rum - by 14%, to 6.19 million liters.

Marketing Director of Luding Group Andrei Ushakov, in a conversation with the publication, noted that tequila accounted for less than 1% of alcohol turnover in the Russian Federation, and in 2022 sales of the drink decreased by almost 15% due to the departure of global brands with a significant share in the category. Tequila Don Julio, for example, was in the portfolio of Diageo, which left the Russian Federation. In this regard, the Luding Group plans to launch its own brand of tequila Corritos. As noted by Andrei Ushakov, it is important to increase the brand representation in all channels to promote the product.

Magnet In "" they said that in 2022 the Sombrero brand took 5.5% of the tequila category in the Russian Federation, in 2022 sales of the brand in Magnit in money increased by 50%.

Magnit, together with Tatspirtprom, will launch the distribution of Sombrero tequila to restaurants and parts of retail outlets. The retailer imports the drink from Mexico.

In 2022, the structure of the Magnit network, Retail Import, imported 15.5 million liters of alcoholic beverages into Russia, excluding the EAEU, according to market participants. Tatspirtprom, which belonged to the government of Tatarstan, in 2022 was the country's second producer of vodka (Tundra, Russian Currency, Khanskaya brands), it also produces tinctures, liqueurs, beer, etc.

Magnit will be able to increase the volume of its own imports, increase its efficiency, and the partner will take on possible difficulties with distribution, says Alexander Stavtsev, head of the WineRetail information center.^[8]

Wine imports to Russia up 10%

Wine imports in Russia in 2022 reached 405 million liters, which is 10% more than a year earlier. Such data from the Federal Customs Service (FCS) were released in early February 2023. Read more here.

2021

Exports of strong alcohol grew by 20%, to $195 million

Russian exports of strong alcohol in 2021 increased by 20% compared to 2020. This is evidenced by the data of the Federal Center for Product Export Development AGRARIAN AND INDUSTRIAL COMPLEX Ministry of Agriculture Russia Agroexport(""), which were published in February 2022.

In total, in 2021, Russia delivered abroad almost 3 million decaliters of strong alcoholic beverages in the amount of $195 million, and most of the sales (2.3 million dal in the amount of $160 million) fell on vodka. Exports of gin and juniper tinctures increased 2.5 times to $3 million.

Sergey Chernikov, Associate Professor of the Faculty of Economics of RUDN University, associates the growth in demand for Russian vodka (its supplies abroad increased by 5.6% in decaliters and by 12% in money, according to Agroexport) partly with the fact that British and Swedish brands have risen in price more than Russian ones.

A noticeable demand from foreign buyers was also observed for cognac, brandy and whiskey from Russia. Whiskey exports amounted to 5.5 thousand decaliters (59% more) by $5.8 million (8.6%), alcohol tinctures from grapes (cognac, brandy, grappa, etc.) - 35 thousand decaliters (32% more) by $4.3 million (37%).

In total, Russian alcohol was exported to 75 countries of the world. The leaders are Europe. In particular, supplies to Latvia increased by 51%. Supplies to China (by 66%), Hungary and Azerbaijan (62% each), Georgia (32%), Vietnam (30%), Germany (25%) also increased. The top 5 importers of strong alcoholic beverages from Russia also included Ukraine ($22 million, 27% more) and Kazakhstan ($14 million, 74% more).

In 2022, the Ministry of Finance of the Russian Federation approved an increase in the minimum retail price (MRC) for vodka, brandy and cognac. The MRC of vodka was increased from 243 to 261 rubles per 0.5 liter. Similar measures were applied to cognac and brandy - their minimum retail prices increased from 446 to 480 rubles and from 324 to 348 rubles, respectively.^[9]

Russian vodka exports grew by 12.2%, to $166.7 million

Russian vodka exports in 2021 increased by 12.2% compared to 2020 and reached $166.7 million. This is evidenced by the data of the Federal Customs Service (FCS), published on February 7, 2022. According to the statistics presented, Russia supplied 2.4 billion decaliters of vodka abroad, which is 6.4% more than a year ago.

It is noted that Russia has been increasing the export of vodka for several years. In 2021, the Russian Federation accounted for about 7% of global supplies. In the list of leaders, Russia is significantly ahead of Sweden and France.

Most Russian companies have strengthened their position in the ranking of the world's largest strong alcohol brands according to the international industry magazine Impact. Stanislav Kaufman, brand director of the Moscow Crystal plant, in a conversation with Kommersant, stressed that the results of Russian companies are primarily related to the problems of foreign manufacturers due to the COVID-19 coronavirus pandemic. Unlike the Russian Federation, in the markets of Western countries, the bulk of the consumption of strong alcohol falls on the catering channel, which, due to the pandemic, worked intermittently, he recalls. The authors of Impact confirm that the COVID-19 pandemic has shifted its focus in favor of brands more focused on home consumption. In addition, Mr. Kaufman adds, the restrictions themselves in other countries were more serious than Russian ones, up to the closure of some factories.

Vice-President of the Russian Standard Holding, President of the Union of Alcoholic Beverages Producers Igor Kosarev believes that Russia has great potential in exporting vodka. He estimated the export market for these alcoholic beverages at $400 billion a year. According to the Russian Export Center, the export of Russian strong alcohol is growing dynamically at a rate of more than 10% per year.^[10]

2020: Decrease in the volume of vodka exports from the Russian Federation by 7.7%, to $148.7 million - FCS of the Russian Federation

The volume of vodka exports from Russia at the end of 2020 reached $148.7 million, down 7.7% compared to 2019. Such data are provided by the Federal Customs Service (FCS).

In 2020, vodka supplies abroad amounted to 2 billion 293.3 million decaliters, which is 2.8% less than a month ago. In December, exports rose by 21.3%, to 291 million 259.3 thousand decaliters, and 39 percent growth was registered in money, to $20.3 million.

The decrease in the export of vodka from Russia at the end of 2020 is associated with the COVID-19 coronavirus pandemic, due to which bars, a restaurant and clubs were completely or partially closed - a large channel for the sale of alcoholic beverages. In addition, the pandemic has greatly reduced international passenger air travel, which led to a drop in sales in duty free stores.

In 2020, Russian vodka was supplied to 76 countries. The top 3 importers in recent years are, and Latvia Germany. The Great Britain top 10 importing countries of Russian vodka also included,,,, Armenia, and Kazakhstan. In Ukraine USA Lithuania Israel Bulgaria 2020 Russia , it ranked third in terms of vodka exports with a share of 7.4%, strongly inferior (21%) and (19 Sweden %). France

On January 1, 2020, amendments to the Budget Code of Russia came into force, within the framework of which manufacturers of excisable alcoholic beverages had the opportunity to subsidize interest rates on loans received for the development of export alcohol production.

According to Igor Kosarev, President of the Union of Alcoholic Beverages Producers (SPAP), for export development, it is necessary to extend state support tools operating in other sectors of the agro-industrial complex to alcohol, including preferential lending, transport subsidies, marketing support and assistance in protecting intellectual property.^{[11] [12]}

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