Tea and coffee (Russian market)

2024

Dangerous pesticides were found in teas "Richard," "Greenfield," "Three friendly elephants" and "Roschayprom." Rospotrebnadzor demanded to urgently withdraw them from circulation

On August 23, 2024, it became known that Rospotrebnadzor demanded to immediately withdraw from circulation the batch of tea brands "Richard," "Greenfield," "Three friendly elephants" and "Roschayprom." The reason for this decision was the discovery of dangerous pesticides in these products that are not provided for by hygienic standards.

According to Izvestia, dangerous substances were identified in the tea of four large brands. In particular, pesticides were found in Richard green leaf tea produced by Mai LLC, as well as in Greenfield black Ceylon tea from Orimi. Two teas from the Ryazan Tea Factory also came under suspicion: black Ceylon tea "Three Friendly Elephants" and black tea with thyme and malva flowers under the brand "Roschayprom."

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Unsplash

Inspections were carried out in December 2023 in retail chains SPAR and "" in the Traffic light Republic. As Tatarstan a result of monitoring studies, pesticides for which hygienic standards have not been established were found in these teas. In this regard, Rospotrebnadzor issued instructions to manufacturers and suppliers of products on the need to develop measures to prevent harm, and also notified the territorial bodies of the department about the need to control the seizure of these goods. The agency instructed manufacturers to develop a program to prevent harm from pesticides in their products.

Previously, such violations have already been recorded. For example, in 2023, Rospotrebnadzor identified pesticides in Richard tea in the Tula region, after which the batch of product was suspended in sale, and consumers were advised not to use this tea with a certain date of manufacture.

The federal Rospotrebnadzor reported that in the first half of 2024, more than 50 thousand inspections were carried out for the content of pesticides in food products, of which 0.02% did not meet the established requirements. All identified batches were withdrawn from circulation, and administrative measures were taken.^[1]

Capsule coffee production launched near Tver for 100 million rubles

The MilFoods company, which develops coffee and roasting production in the Tver region, has launched a new line for making coffee in capsules under the Poetti brand at the enterprise. The press service of the regional government announced this on January 30, 2023. Read more here.

2023

Coffee production in Russia for 4 years increased by 62%, to 87.3 thousand tons

In 2023, 87.3 thousand tons of natural coffee were produced in Russia. For comparison, in 2019, the volume of production of these products was estimated at 54.1 thousand tons. Thus, in four years, production increased by 62%, as stated in BusinesStat materials published in mid-October 2024.

The study takes into account fried and non-cooked natural coffee. The production volumes of these products in Russia are steadily growing, which is associated with an increase in demand. So, in 2019, coffee consumption in the country for the first time exceeded tea consumption. In large cities, a culture of coffee consumption in public catering began to take shape, coffee chains appeared en masse, craft coffee drinks became in demand. Among the major players in the industry are named LLC "[[Orimi Trade'Orimi," LLC "May-Brands," LLC "Strauss," LLC "Slavkofe," etc.

In 2019, the volume of natural coffee production in Russia amounted to 54.1 thousand tons, showing an increase of 19.2% compared to the previous year. In 2020, an increase of 14.9% followed - to 62.1 thousand tons. At the same time, in the segment of the hotel and restaurant business, a decrease in demand was recorded by about 10% due to restrictions introduced in the context of the COVID-19 pandemic. At the same time, retail sales continued to grow, which contributed to an increase in production at large coffee factories.

In 2021, coffee production in the Russian Federation jumped by 23.8%, reaching 76.9 thousand tons. In 2022, the increase was 1.1% with a final result of 77.7 thousand tons. The decline in growth is associated with a worsening geopolitical situation: Russian companies are faced with a rise in logistics prices, an unstable exchange rate, changes in the terms of payment for goods and other difficulties. The situation stabilized in 2023, when the volume of production rose by 12.3%.^[2]

Growth in coffee sales by 3.6% to 185.8 thousand tons

In 2023, approximately 185.8 thousand tons of coffee were sold on the Russian market. The growth in relation to 2022, when 179.4 thousand tons of products were sold, amounted to 3.6%. Such data are reflected in the BusinesStat study, the results of which are presented on February 27, 2024.

Analysts take into account the implementation of natural, soluble and sublimated coffee. The list of leading players in the industry includes Jacobs Dow Egberts Rus LLC, Orimi LLC, Strauss LLC, Fez Product LLC and Orimi KF LLC.

The report says that in 2019-2023, coffee sales in Russia showed small but stable growth. So, in 2020, the volume of sales increased by 0.1% compared to 2019 - from 178.4 thousand tons to 178.5 thousand tons. The decline in the catering industry caused by the COVID-19 pandemic had a negative impact on demand. However, the market contraction was avoided due to the growth of retail coffee sales.

In 2021, sales increased by 0.4%, amounting to 179.2 thousand tons, and in 2022 the increase was at around 0.1%. The slowdown occurred as a result of sharply increased (by 27.4%) coffee prices, which was associated with a low harvest of this crop in Brazil. In addition, the cost of delivering products to Russia increased, since against the backdrop of a deteriorating geopolitical situation, the largest Western logistics and insurance companies refused to work with domestic customers.

It is noted that in 2023 the growth rate of coffee sales was the highest in five years. Due to price stabilization, the dollar value of imports of products to Russia decreased by 1%, while the average sales price rose at a rate much lower than inflation - by 4.2%. At the same time, in 2022-2023, there was a tendency in Russia to reduce tea sales, which opens up additional opportunities in terms of increasing the share of the coffee segment.^[3]

Reduction in tea production by 6.2% to 138 thousand tons

In 2023, about 138 thousand tons of tea were produced in Russia, which is 6.2% less than a year ago. This was announced in February 2024 by BusinesStat analysts.

According to them, the decline occurred after in 2019-2022, tea production in Russia increased by 32%, to 147 thousand tons, and the decrease in production in 2023 was partly due to the shutdown of the Ekaterra plant (TM Lipton and Brooke Bond brands) in St. Petersburg. At the same time, the Russian company "Orimi" in an attempt to take advantage of the departure of a competitor from the market announced an increase in production by 5-7% at the end of 2023.

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BusinesStat

As noted in the report, in Russia, due to the peculiarities of the climate of its own tea, it is extremely small: on an industrial scale, it is grown only in the Krasnodar Territory, so the country is almost 100% dependent on imports. At the same time, about 80% of imports are made up of tea, which is a raw material intended for further processing and packaging, and only 20% are ready-to-sell products.

At the same time, in 2023, there was a downward trend in the share of finished imported tea. This is due to a higher cost, and most importantly, with a long logistics, which is at least a month from the date of order, analysts say.

They add that companies that have their own production in the country are most active in the Russian market. Imported packaged tea in the form of a finished product by 2023 was presented mainly in the premium segment.

The following companies (without specifying shares) are named the largest tea producers in the Russian Federation: DobrynyaRus, Kuban-Ti, May, Orimi, Santi, Universal Food Technologies, Akhmad Ti Factory, Fez Product and Yakovlevskaya Tea and Vegetable Factory.^[4]

Russian market for takeaway coffee grew by 21%

The volume of the coffee market with you at the end of 2023 reached 102.7 billion rubles, which is 21% more than at the end of 2022 (85 billion rubles). Such data are provided by Smart Ranking. Read more here.

The number of coffee shops in Russia for the year increased by 10%

By the end of 2023, the number of coffee shops (classic establishments and points with takeaway coffee) in cities with a population of one million in Russia amounted to 15.4 thousand points, which is 10% more than a year earlier. This is evidenced by the data of GIS, "published on February 5, 2024. Read more here.

2022: Reduction of coffee sales by 11% to 86 thousand tons

The volume of the Russian coffee market in 2022 reached 86 thousand tons, which is 11% less than a year earlier. Such data in early May 2023 are cited by BusinesStat analysts.

According to them, coffee sales in the Russian Federation decreased largely due to the following factors:

• significant price increases. Coffee growing countries did not join the sanctions against Russia, however, the rise in world prices for green coffee and the refusal of a number of large container carriers and insurers to work with Russian companies led to a significant increase in the cost of supplies and to an increase in the cost of logistics;
• a decrease in real disposable income of Russians contributed to a decrease in the volume of coffee purchases;
• a decrease in the number of coffee buyers due to the departure of a significant number of Russians in 2022.

The volume of the Russian coffee market in 2022 reached 86 thousand tons

According to researchers, in 2018-2021. coffee sales annually grew at a fairly significant rate, by 6-20% per year. Coffee grew in popularity, the number of coffee shops increased, and fast food chains developed. This makes it possible to predict that as prices for coffee raw materials stabilize, importers' logistics problems are solved and real incomes of Russians resume to grow, coffee sales in the country will continue to grow, according to a study published in early May 2023.

According to the report, coffee exports from Russia in 2018-2021. increased annually by 17.8-50.2% per year and reached 15.1 thousand tons in 2021. In 2022, coffee supplies from Russia for the first time in five years decreased by 9.7% and amounted to 13.7 thousand tons.

The price of coffee exports from Russia decreased in 2019-2020. and at the end of 2020 amounted to $4.23 per kg. In 2021-2022 there was an increase in export prices. However, in 2021 the growth was insignificant (by only 0.8%), in 2022 the price increased more significantly - by 29.3% and reached $5.51 per kg.^[5]

2020

According to Nielsen, in the largest retail chains of the Russian Federation from August 2019 to July 2020, coffee sales in Russia increased by 16.1% in monetary terms and by 12.8% in kind. Euromonitor International estimates the volume of the Russian coffee market at 140.13 thousand tons, and the turnover - at 224.7 billion rubles. for 2020.

Coca-Cola begins selling cereal and ground coffee under Costa Coffee brand

In September 2020, it became known that Coca-Cola is starting a new business in Russia - the sale of grain and ground coffee under the Costa Coffee brand. Consumption of these products is growing, and the retail market has hardly suffered during the COVID-19 pandemic. But, experts and market participants believe, competing with existing Coca-Cola players will be difficult, primarily due to expensive imports. Read more here.

2019: Coffee first became more popular than tea in Russia

In 2019, coffee consumption in Russia reached 180 thousand tons, which is 12% more than a year earlier, and the tea market during this time grew from 151.5 to 138.8 tons. Coffee has become more popular than tea among Russians for the first time. In the previous two years, residents of the Russian Federation consumed approximately the same amount of tea and coffee over the year - 160 thousand tons each, according to the data of the Russian Association of Tea and Coffee Producers "Rosschaikofe."

Coffee consumption grew from year to year, starting in the late 1990s, and tea, in general, was in such a stagnating position. And so, in general, at some point it was obvious that this would happen. This happened in 2019 unequivocally, - said Ramaz Chanturia, general director of Rostchaikof.

For the first time in Russia, they began to consume coffee more than tea

 Data from the Federal Customs Service (FCS) generally confirms the words of Chanturia. In 2019, Russia imported 413.3 thousand tons of coffee of the main types (excluding soluble) and only 314.2 thousand tons of tea. According to the head of Rosschaikof, the discrepancy in the data is explained by the fact that customs takes into account the supply of raw materials, not finished products.

 The research company GfK told RBC that Russians have been buying coffee home more often than tea for two years. In 2019, they bought 110.8 thousand tons of coffee and 90.6 thousand tons of tea, in 2018 - 104.7 thousand and 92.3 thousand tons.

The consumption of pure tea has decreased dramatically. Obviously, part of consumption is replaced by an increase in the popularity of herbal and fruit drinks, including Ivan tea, but now for the first time it can be confidently argued that the growth in popularity of coffee has had a significant impact on the reduction in tea consumption, according to Rosschaikof

The association also noted an increase in the consumption of grain coffee: if its share in 2018 was 52% versus 48% for soluble, then in 2019 this ratio was 44.7% to 55.3%.^[6]

The largest player is Nestle (Nescafe brand) with a 19.4% share of the Russian coffee market in 2019.

2018: Per capita tea consumption per kg per year

Tea consumption per capita, kg per year. Data for 2018

See also

• Coffee (global market)
• Tea (global market)

Notes