Vodka (Russian market)

Vodka (global market)

Main article: Vodka (global market)

Production

2023

The largest vodka producers in Russia are named

According to the results of 2023, Novabev Group (Beluga, Belenkaya, Myagkov brands) remained the largest producer of vodka in Russia, which produced 9.9 million decaliters of the drink during the specified period against 10 million decaliters a year earlier. The corresponding statistics were released on January 23, 2024.

According to Kommersant, citing data from market participants, Tatspirtprom (Tundra, Khanskaya brands) took the second place in the production of vodka in the Russian Federation in 2023, which produced 9.5 million decaliters of products, which is 2% higher than the result of 2022. The top three also includes the Siberian Alcohol Group (ASG; "White Birch," "Husky") with the production of 7.86 million dal vodka against 7.92 million dal a year earlier.

Novabev Group remains the largest producer of vodka

Occupying the fourth position of the Rust Group of Companies (Russian Standard, Green Brand) in 2023 reduced the production of vodka by 8%, to 5.8 million decaliters. The fifth place was taken by Bashspirt, controlled by Bashkiria (White Fortress, Gold of Bashkiria), increasing vodka production by 14% to 4.49 million decaliters. And the largest growth rates among 20 companies were shown by KLVZ Kristall (Bionica) and Ladoga (Tsarskaya), increasing vodka production by 59% and 46%, to 2.11 million decaliters and 2.06 million decaliters, respectively, the newspaper notes.

According to experts interviewed by the newspaper, the success of Novabev Group is associated with the development of its own stores and good representation in federal chains. Market participants, in turn, expect to maintain the volume of vodka consumption in 2024, including by replacing imports.

Deputy General Director of Tatspirtprom Yuri Karjakin told the publication that in 2023 the company's shipments reached a record level, an increase of 7% year-on-year. In addition, sales of the Tundra brand increased by 60%.^[1]

The leader changed in the list of the largest vodka producers in Russia for the first time in a long time

Tatspirtprom"" (the company is owned by the government; Tatarstan produces Tundra vodka, Russian Currency, Khanskaya) ahead Beluga Group of vodka production and took first place among its largest producers in the first quarter of 2023. This became known in early May 2023.

In January-March 2023, Tatspirtprom increased the production of vodka by 8% year-on-year, to 2.05 million decaliters. At the same time, Beluga Group, which occupied the first place (Beluga, Arkhangelskaya, Belenkaya, etc.) reduced production by 11%, to 1.98 million decaliters, and dropped to second place, writes Kommersant"."

The leader has changed in the list of the largest vodka producers in Russia

In total, 15.8 million decaliters of vodka were produced in Russia, which is 8% less compared to the first quarter of 2022. A decrease in production was also recorded among other players. In particular, the Alcoholic Siberian Group ("White Birch," "Five Lakes," "Husky") produced 1.33 million dal of vodka (-16%), GC "Traditions of Success" ("Horta") - 1.28 million dal (-21%), GC "Rust" ("Russian Standard," "Green Mark," "Parliament") - 1.23 million dal (-27%). The largest production volumes were increased by the Kaluga plant "Crystal" - by 71% to 346,000 decaliters.

Tatspirtprom says that in January - March 2023, the Russian vodka market did not grow due to the high base of 2022 and the poor performance of this March. Tatspirtprom's growth in the category was mainly provided by the Tundra Authentic and Khlebnaya brands, whose shipments increased by 54% and 16%, respectively. The ASG explained the reduction in vodka production year-on-year by rush demand in the first quarter of 2022, when chains filled shelves and buyers made purchases for future use.

The Beluga Group did not provide a comment at the request of the newspaper. Earlier, the group explained that the results of the first quarter of 2023 were affected by abnormal shipments in March 2022 related to political events.^[2]

Reduction in vodka production by 4.3% to 80.4 million decaliters

The volume of vodka production in Russia at the end of 2023 amounted to 80.4 million decaliters (dal), which is 4.3% less than a year earlier. Rosalkogoltabakkontrol published such data on January 15, 2024.

The main reason for the fall in the production of vodka and other alcoholic beverages, analysts at Strategy Partners consider the ban on the export of domestic alcoholic beverages to the EU, the United States and a number of other countries. The ban on the supply of alcohol from Russia was adopted by the sixth package of sanctions, which in total reduced the volume of export revenue by about a third of the total, experts calculated.

Vodka production amounted to 80.4 million decaliters

The factor in the decline in demand and, as a result, the decline in production was the fall in household incomes and the transition to cheaper alcoholic beverages - beer and other drinks, - said Ekaterina Mikhaleva, director of the Consumer Sector practice at Strategy Partners, in a conversation with Izvestia. However, it is not yet possible to say for certain whether the market will return to pre-crisis values, although there are prerequisites for this. Cheaper analogues of world brands appear on the market, demand and interest in the domestic product are growing.

According to the president of Ladoga, Veniamin Grabar, the fall in vodka production in 2023 may be an extra question and production in 2022. For example, according to him, the volume of production of Ladoga's own brands increased by 27%. In particular, the production of vodka increased by 62%, gin - by 22%, Russian whiskey - by 76%.

Then [in 2022], against the background of an incomprehensible course and the general situation in the country, purchases were made for future use, which caused a jump in production, Grabar recalls. - In this [2023] year, no similar behavior was observed. Today, the market is stable.

In 2023, State Secretary - Deputy Minister of Finance Alexei Sazanov attributed the drop in vodka production in Russia to a sharp reduction in exports of these alcoholic beverages.^[3]

2022: Top 10 biggest producers named

In Russia in 2022, sales of vodka increased by 5.9% compared to 2021 - to 76.2 million decaliters (dal). This was reported in the press service of Rosalkogolregulirovanie on January 24, 2023. The list of the largest vodka producers in Russia for 2022 is given by Kommersant.

According to the publication, three of the five largest vodka producers in Russia slowed down the pace of production of the drink in 2022 relative to 2021. Occupying the first line in terms of Beluga Group volumes (Beluga, Arkhangelskaya, Belenkaya brands) reduced production by 104 thousand decaliters, to 10.01 million decaliters. GC "Traditions of Success" ("Horta") in 2022 produced 7.1 million dal of vodka, which corresponds to last year's level. And the production of the Rust Group of Companies (Russian Standard, Parliament, Green Mark) decreased by 34%, to 6.32 million decaliters. In 2021, the production of vodka from these players grew by 5%, 45% and 5%, respectively.

The Traditions of Success Group told the newspaper that production supports a low price on the shelf in comparison with other strong alcohol and a narrowing of supply in the import of the economy segment. Beluga Group said that the decrease in the amount of 104 thousand dal was influenced by export sanctions, as well as deviations between sales and production on the size of the balances. After the outbreak of hostilities of the Russian Federation in Ukraine, the authorities of the EU, the United States and the United Kingdom banned the import of vodka from Russia. And in 2021, about 45% of strong alcohol exports from the Russian Federation in money fell on Latvia, Great Britain and Germany, calculated in Agroexport. The Rust Group of Companies noted that as the largest exporter of vodka from Russia, production volumes were reduced due to the embargo.

Among the five key players, the most noticeable production of vodka in 2022 was increased by Tatspirtprom, owned by the government of Tatarstan, by 13%, to 9.3 million decaliters. The company associates the dynamics with the growth of sales of the flagship brand Tundra by 38% in the category and with the launch of new products.^[4]

2021: The share of Russian producers increased to 89.03%

On October 13, 2022, the Gradus agency shared the results of a study of the elite strong alcohol market.

The share of vodka sales of Russian producers in the domestic market increased in February-July 2022 compared to the same period in 2021 from 86.23% to 89.03%. Back in 2021, the main competitor of Russian premium vodka, although with a huge difference in market share, was vodka from Finland. But in February-July 2022, due to EU sanctions and a 19% increase in prices for vodka from Finland in annual terms, sales of Finnish vodka in Russia fell by 20% in natural units, and the share of vodka from Finland in the Russian market decreased from 4.47% in February-July 2021 to 2.84% in February-July 2022.

Vodka from Sweden has become less popular, sales volumes have decreased by a third, sanctions and an average price increase of 21% have affected. The liberating niche of imported products, in addition to Russian producers, is also replaced by manufacturers from Belarus, since the share of vodka from Belarus in the specified period of 2022 increased from 1.4 to 1.65%.

Sales of premium vodka increased in February-July 2022 by 25% year-on-year by 2.74 million DAL and by 27% to 46.7 million units. Vodka of the premium price segment in this period increased in price by only 2.6%, significantly lagging behind inflation in price dynamics, which was an important reason for the growth in sales volumes. In the premium vodka segment, Russian vodka occupies a maximum share exceeding 80% (based on sales volumes in physical terms).

Sales

2022: Israel comes out on top in terms of Russian vodka imports

Israel in 2022 increased purchases of vodka from Russia in monetary terms - from $5.7 million in 2021 to $24.7 million, becoming the largest importer of Russian vodka in the world. This was reported in April 2023 by RIA Novosti with reference to the analysis of UN Comtrade data.

The second place in the import of Russian vodka in 2022 was taken by Germany, which, on the contrary, reduced purchases - from $43.4 million in 2021 to $7.5 million. The top three also included Armenia, which also reduced the import of this drink. It is noted that the country has reduced supplies by almost half - from $13.2 million in 2021 to $6.9 million a year later. The ten leaders in terms of purchases of vodka in monetary terms also included:

• Britain ($5.5 million);
• USA ($5 million);
• Georgia ($3.9 million);
• Azerbaijan ($3.4 million);
• Czech Republic ($3.3 million);
• Bulgaria ($2.5 million);
• Slovakia ($2.2 million).

Israel became the largest importer of vodka from Russia in 2022

Over the years, Britain has been the leader among importers of Russian vodka, which bought the drink for more than $50 million annually, but in 2022 this country dropped to fourth place among countries that buy Russian vodka more than others. The news agency notes that the EU countries, the USA, Japan and Canada, within the framework of the sanctions packages adopted in 2022, have limited the import of some goods from Russia, which, in their opinion, are important for budget revenues. The restrictions affected, among other things, strong alcoholic beverages, primarily vodka.

In 2022, the volume of vodka production in Russia increased by 4%. At the same time, some of the largest domestic players have a slowdown in growth. Companies associate this with the sanctions of Western countries on the import of vodka from the Russian Federation in connection with military operations in Ukraine. Experts note the possible achievement of the peak of alcohol production and predict a narrowing of the market and a redistribution of demand.^[5]

2021: Falling demand for vodka

The demand for vodka in Russia in 2021 decreased: the sale of these alcoholic beverages in stores in countries fell by 0.9% compared to 2020, to 71.9 million decaliters. According to the NRA agency, the decline in demand was influenced by state regulation measures: high excise rates, restrictions on trade and advertising. In 2021, prices for vodka still grew more slowly than for the rest of alcohol, but the excise tax on it is indexed annually by 4%, the minimum price for the purchase of ethyl alcohol from food raw materials increased by 16%. The consumption of vodka is also influenced by the increase in the share of the population, which follows the principles of a healthy lifestyle, added to the NRA.

The fall in demand for vodka is a long-term trend, analysts at GfK say. The proportion of households buying vodka has consistently declined since 2016, they said. The average consumption of vodka per family in GfK is estimated at almost 6.5 liters per year.

2020: Sales growth 0.4%, to 73.7 million decaliters

Vodka sales in 2020 increased slightly - by 0.4%, to 73.7 million decaliters. this is evidenced by data from analysts at NielsenIQ. Rosalkogolregulirovanie (RAR), which takes into account the sale of alcohol both in stores and in public catering, agrees with these figures.

Consumption

2021: Vodka consumption up 2%

The consumption of vodka per capita in Russia at the end of 2021 increased by 2%, to 5 liters per person. This is evidenced by data from the Center for Research on Federal and Regional Alcohol Markets (CIFRRA). The organization used information on legal sales from the state accounting system of the EGAIS and the population in the Russian Federation at the end of 2020. During the same period, sales of vodka per person also increased by 2%, explained in CIFRRA.

2020: Increase in vodka consumption in the Russian Federation by 2%, to 4.9 liters per capita - CIFRRA

Vodka consumption in Russia at the end of 2020 amounted to 4.9 liters per capita, which is 2% more than the previous year. This is evidenced by data from the Center for Research on Federal and Regional Alcohol Markets (CIFRRA).

The calculation was made on the basis of information on sales of alcoholic beverages from the state alcohol control system, UNIFIED STATE AUTOMATED INFORMATION SYSTEM as well as preliminary information Rosstat on the population in Russia as of January 1, 2021, clarify "" News with reference to CIFRRA.

Leaders in vodka consumption per capita:

• Sakhalin - 12.4 L (+ 2%),
• Magadan region - 11.6 liters (+ 2%),
• Komi - 11.2 liters (+ 3%),
• Karelia - 9.8 liters (unchanged),
• Chukotka - 9.4 l (-6%).

Vodka consumption in Russia in 2020 increased by 2%

As the head of TSIFRRA Vadim Drobiz noted, the top 5 regions in terms of vodka consumption do not change from year to year, since we are talking about territories remote from the central part of Russia, where it is difficult and unprofitable to take illegally produced products. Therefore, residents of these regions usually consume only legal drinks.

Drobiz noted that vodka consumption did not jump sharply even though 2020 suspended all movement of Russians outside the country.

According to statistics from CIFRAA, in 2020, legal production of vodka decreased by 4.9%, and its sales through EGAIS increased by 2%.

As the President of the Union of Alcohol Producers (SPAP) Igor Kosarev noted, due to the COVID-19 coronavirus pandemic, channels through which legal vodka is usually illegally sold were covered. The fact is that in 75 thousand settlements of the country there are no stores with a license to sell alcohol, and, for example, legal vodka is sold in them illegally. But in 2020, due to difficulties related to logistics and movements, some of the legal vodka was sold legally.^[6]

Notes