Weekly analytical column of Vadim Drobiz Week May, 16 2016 – May, 22 2016 (12)

Weekly analytical column of Vadim Drobiz

Week May, 16 2016 – May, 22 2016

Vadim Drobiz – Head of the Center for Federal and Regional Alcohol Market Research (CFRAMR)

The most quoted in the Russian media expert on the alcohol market of Russia, former Soviet republics and Eastern Europe. The latest news, detailed analysis, commentary, statistical databases on the alcohol market since 2002.

Full versions of the materials published in Russian on the website Vadim Drobiz http://cifrra.info/

 The situation on the Russian wine market and retail trade

I have already said earlier that since February this year, almost completed import substitution of finished wine production in Russia. Production of own wine in the first quarter (-7.9%) and imports (+ 4.1%). If we take one month of March, imports (+ 21%). In sparkling wines in the first quarter of this year, its own production (-16.7%), but already in March (-4.9%). Import sparkling in the first quarter of this year (+ 1.4%) in March (+ 34%).

It is normal that in the first quarter continued to actively import of imported wine materials (+48%) – in this is the salvation of our market from counterfeit. Planted new vineyards over the years 2013- 2015, will give significant crop only in 2020. They can give a yield increase about (+ 19%) and (+ 19%) of finished wine to the figures of 2015. Not previously and no more.

Recently, the Russian media often commented on the rise in prices of the part of wine production in the first quarter of 2016. From my point of view, this shows excessive dependence of Russian winemaking on imports wine materials and exchange currency rates. In October and November 2015 the dollar was 67-70 rubles, and at that time in the retail price many of companies was laid rate no higher than 65 rubles. The end of December last year – in January 2016 the dollar was about 80 rubles. Since February went falling dollar. It is understood that on the shelves in March wine sold at a high rate of December – January. And just as it is clear that fall in retail prices after the fall of the dollar in March and stabilize it at the level of 66-67 rubles will not be. Wine trading business is forced to lay in the retail price rate of the dollar is not less than 73 rubles to insure the next inevitable recession of ruble. No one wants to transfer the foreign exchange fluctuations in the price jumps, and immediately laid the high dollar rate in retail prices.

Table for the production of wine products in Russia

Production figures(mln dal) 2010 2011 2012 2013 2014 2015
Still wines 45,07 40,4 36,7 33,91 32,08 39,94
Sparkling wines 22,36 22,02 20,55 17,22 15,55 16,02
Wine beverages 1,75 1,34 2,21 12,27 17,15 23,79
Total: 69,18 63,76 59,46 63,4 64,78 79,75

Non-alcoholic beer: Trends and Prospects

Non-alcoholic beer is becoming more popular among Russians: in the first quarter of 2016 its production increased by 34.5% at once. Among the reasons – improving the taste of the drink and a lot of advertising, according to retailers and manufacturers.

In the first three months of 2016 in Russia was produced 13.3 million liters of non-alcoholic beer, which is 34.5% more than in the same period of 2015. The increase in total beer production in the whole country amounted to 6.4%, to a value of 1.56 billion liters (i.e., non-alcoholic beer had less than 1% of the total beer production in the country).

Three years ago, alcohol-free (or “zero”) beer is not caused much interest among Russian consumers, but the situation is changing: from 2013 to 2015, the non-alcoholic beer production increased by 9.4%, despite the fact that the country’s total production of beer has decreased over same period by 19%. Only 2015 non-alcoholic segment grew by 1.1%, to 72 million liters, despite the fact that beer production in the year as a whole fell by 5.7%, to 7.3 billion liters. According to the research company Nielsen, the share of non-alcoholic beer now accounts for 1.08% of all beer sales in Russia. In 2013, its share was less – 0.73%.

The growth of non-alcoholic beer production and increased assortment in this category are mainly related to the specifics of advertising legislation in Russia. Beer, containing alcohol, are allowed to advertise only during the broadcast of sport events, only at a certain time, in addition, to such advertising is prohibited to use images of people and animals. For the non-alcoholic beer all these restrictions do not apply, so manufacturers often promote it as an umbrella brand for the advertising entire line of its beer. With this advertisement the consumer learns about the existence of non-alcoholic varieties and buying them more often.

Prior to 2016 advertising of non-alcoholic beer on central TV channels appeared only sporadically, and is now present in the ads blocks on a permanent basis. Advertising of non-alcoholic beer on television – a great opportunity for the producer of beer to advertise your entire brand. For the manufacturer of non-alcoholic beer production – to a greater extent this is an opportunity to stimulate interest in the brand as a whole, including alcoholic beer.

As evidenced by the company TNS Global data (monitors more than 550 TV channels in 29 Russian cities, including Moscow), brewing company in 2016 actually returned to the number of advertisers on TV. In the first quarter beer commercials were aired on TV 766 times; their total duration was just over 217 minutes. However, while it is still quite a bit. For comparison: in the first quarter of 2012, when a ban on alcohol advertising of beer has not acted (was introduced on July 1, 2012, and before that the ads may appear on the air after 22 hours), TNS recorded 6077 shows a total duration of 2014 minutes.

Representatives of the brewers companies agree that until the beginning of 2016 wary of television advertising. Possibility of advertising non-alcoholic beer for industry have always been. The only thing that stopped from being able to start using this right in full – the lack of effective tools for the labeling of this product in such a way to avoid any mixing alcohol with non-alcoholic brands.

As a result, the market leaders have agreed to a special icon that emphasizes soft nature of the products, and received a guarantee from the Federal monopoly service supervising compliance with the law “On Advertising”, which claims to such ads will not arise. In the summer of 2014 the company “SUN InBev” (Russian division of the Belgian brewing corporation AB InBev) released promo video of beer “Siberian Crown nonalcoholic”, starring Hollywood star David Duchovny, and in 2016 – in favor of soft beer Hoegaarden ads with Chuck Norris.

The leader of the soft segment of the Russian beer market with a share of 58.8% is “Baltika” (owned by the Danish Carlsberg), promoting the brand “Baltika 0″. In 2013, the company’s share was higher – 79.9%. The development of non-alcoholic drinks portfolio for Carlsberg is one of the strategic goal on the global market.

The press service of the Moscow Brewing Company said that also rely on the non-alcoholic variety. There are non-alcoholic “Trechgornoe”, which is specially produced for sale at the stadiums during football matches. Such a non-alcoholic beer may be sold also on airplanes, trains, etc.

The representative of another brewer Efes Rus said the company believes in the potential of soft segments: Efes had and before quite an extensive range of non-alcoholic beer in the assortment of products, and in 2016 the company launched three new non-alcoholic varieties, including under the Miller brand.

The representative of Heineken (has in the portfolio non-alcoholic version Amstel and Zlatý Bažant) said that the increase in this category of his company has been going on for two years. He believes that the growth in demand for this type of beer production is not so much connected with the appearance of a large number of commercials on television, how much is a global trend, coupled with the popularity of healthy lifestyles.

According to Euromonitor International, if in 2013 the world market of non-alcoholic beer was $ 5 billion, that by 2018 will grow to $ 6.5 billion. The main driver of growth is actively work of breweries in Muslim countries where alcohol consumption is prohibited or not welcome by religious reasons. “For example, in Iran, non-alcoholic beer consumption growth is now such that if tomorrow will come the end of the world”, – quotes the expert of Euromonitor Huffington Post. Among other reasons, the expert called the work of companies to improve the taste of non-alcoholic beer – “in the 1990s, it even does not reminiscent taste of beer.”

Weekly analytical column of Vadim Drobiz Week May 09 2016 – May, 15 2016 (11)

Weekly analytical column of Vadim Drobiz

Week May, 09 2016 – May, 15 2016

Vadim Drobiz – Head of the Center for Federal and Regional Alcohol Market Research (CFRAMR)

The most quoted in the Russian media expert on the alcohol market of Russia, former Soviet republics and Eastern Europe. The latest news, detailed analysis, commentary, statistical databases on the alcohol market since 2002.

Full versions of the materials published in Russian on the website Vadim Drobiz http://cifrra.info/

Email: alko-pr59@yandex.ru

Emirates and alcohol

Elena Rykovtseva – journalist of Radio Liberty

The first time I went to Dubai 18 years ago with my eldest daughter. And at this time I was pregnant with my youngest one, so then for me of alcohol problems did not exist. I just knew that consume it at the moment I cannot. I was then do not matter, have it in this country or not. But on arrival in Dubai then it turned out that the problem is acute care for the local population. Every morning we drove from the hotel to the beach in small car. His driver was never tired of every time to ask us whether we have vodka? We told that there is not brought. But he could not believe in such nonsense. A new morning began with new inquiries: whether we have a bottle of alcohol? We are disappointed the driver, and he once again did not believe us: this cannot be, that we came to this country without big supplies of alcohol.

In my current visit to Dubai it was all different. This time I was not pregnant, so prudently tried to find out in advance, as in this Muslim country affairs with drinking? Friends have told me that the local restaurants do not have a problem with it. When we arrived, we went to explore the restaurants, there are an incredible number of them – for all tastes, cuisines from around the world. Dubai – this is modern Babylon, in which the English language is more common than Arabic. How else to communicate peoples from dozens of countries who working in the emirate? Dubai does not give the impression of orthodox and very religious city. Many women walk around town in shorts and no one is shocking! Everything is like in any European or American bustling resort city.

However, as our survey of the restaurant market it turned out that they do for all tastes, but not in all religions. None of them had alcohol! “You will not find it here.” So we were told in an Indian restaurant, located in the world’s largest Mall of Dubai. I did not believe in it and we went to a nearby Italian restaurant, where behind the bartender we saw bottles of limoncello.

We sat at a table and ordered a pasta and asked for the wine list. And we were told that there is no wines. And it was very sad – to sit in a good Italian restaurant with gorgeous views of the Dubai Fountain, there is the usual Italian food and do not drink Italian usual red wine.

And then for dessert, they brought us limoncello! “A gift from the boss,” – smiled the waitress. I was glad that I can drink as much as two glasses, because my youngest daughter, with whom I went this time in Dubai, does not drink alcohol. However, two glasses, by contrast, got she.  Because the liquor turned soft drink. So, stringy lemon syrup. One mockery.

Then we went to a luxurious new quarter Marina Dubai. This latest collection of skyscrapers over the artificial lake. On the lake slowly sailed boats, strolling along the promenade people, and the whole promenade was full of restaurants “7 km restaurants !!” – It was written on the illuminated signs. We walked along the endless chain of Brazilian, Portuguese, Italian, Mexican and some more restaurants, and the whole chain is something reminiscent to us restaurant’s waterfront in Miami Beach, Florida, but we felt important difference: there was no loud music, laughter and loud conversations. Here people sat at tables, drinking glasses of water, talking quietly, and in general they were few! And the food on their tables was not enough, because  plain water does not cause of appetite. And I again, as in the Dubai Mall, asked for waitress: “And whether there is at least one restaurant with alcohol?” And received the answer: “There is no, but in the blue skyscraper – there is a little shop with any alcohol and there may be sold it to you.”

But we did not have the power to go into the shop. We sat down and had dinner at this quiet waterfront as everybody. I ate and thought how strange: Dubai – designed for tourists. It attracts them with all their windows. It’s all oriented for trade. And the ban on any alcohol, local authorities are not only deprived of income from the sale of it, they are the rest of the trade do worse. Tourists eat less in their countless restaurants and less buying in their unending malls, because alcohol – it’s not only enhances the appetite, it is very stimulating consumer hype. I feel it is good in myself: after a glass of alcohol I was very drawn to the purchase. I do not rule out that for many other people alcohol increases the buying activity. So the one who does not give people drinking hinders trade.

In this sense, it is interesting as in the Emirates sell pork. The supermarkets have a small department for non-Muslims, where sell this kind of meat. Nothing like this on alcohol. It is not sold in supermarkets. I have a version of why this is so. I think, because Muslims will not eat pork under any conditions, and it can to sell. But alcohol – this is a big temptation. And consume alcohol locals want. They are ready to sin on your own risk. And in order not to enter into temptation of its citizens, which will be difficult to sustain, the store did not sell alcohol.

We moved from Dubai to Abu Dhabi. There’s alcohol can be found in stores and restaurants, but:

… these restaurants only at expensive hotels.

… just a couple of these stores, and their windows are tightly closed and that the store sells alcohol, you can guess, but once inside it.

… in order to buy alcohol, you first need to buy a license to purchase it.

… such a license sell only to visitors employees (non-Muslims), but not for tourists. To do this on the website need to download the number of work visa and a certificate of salary! You cannot spend on alcohol more than 10 per cent of yours wages. The license costs about 150 dollars. It is expensive!

So what to do? A friend of mine told me: “You go to the store and you will be ask a license, and you say that you forgot it at home, but most likely you do not even ask. But some builders from Bangladesh are likely to be asked. It is at the discretion of the store or restaurant employees. Because if you order alcohol in a restaurant, you must also show the license. But if they see that you’re an obvious tourist – the license is not likely to be asked. ”

– But they have to ask?

– They ask a must. But do not ask.

Alcohol, even if you have a license or shop (restaurant) sold alcohol to you without it, will cost you dearly. Prices in a store about 30% higher than, for example, in Europe. A bottle of ordinary Chilean wine, which in Europe costs $10, in the Emirates will be $15. But in hotels $15 worth just one glass of wine. Bottle of real limoncello – it’s $200.

At the same time in a German restaurant at a local hotel you can easily see how there sat a man in traditional Muslim clothes and drink beer. And no one forbid! As I was told, in the Emirates all ready to close their eyes while the visitor does not violate the accepted rules of behavior.

It seems to me that prohibit (or limit) the consumption of alcohol for those who do not consider its consumption as sin, it is too big a concession the economy in favor of religion in the country turned increasingly to tourism than to religious fanaticism.

And if we really talk about practical things – it is not necessary to wait for the mercy from local regulations. The United Arab Emirates are allowed to import four liters of alcohol per person. On a very short break should be enough!

Alcohol and age …

I would like to bring the following table, which shows the structure of the consumption of alcoholic beverages in Russia today, depending on the age drinkers.

Age of the consumer vodka beer wine port wine moonshine
- to 25 years old 25% 80% 28% 7% 7%
- to 26- 39 years old 50% 70% 26% 9% 7%
- to 40- 55 years old 59% 53% 23% 9% 9%
- over 55 years old 58% 35% 21% 12% 13%

(Respondents were allowed to name a few types of alcoholic beverages.)

Vodka consumption grows with age. But with beer trend reverse. Most of all wine consumed young people up to 25 years. Then consumption is declining.

Today the population of Russia at the age of 18 to 25 years in 2 times less than in the beginning of the century. Potential consumers of wine was less demographically. This factor has started to work on the wine market in 2012- 2013.

The following table shows the legal sale of wine in Russia in million dal given by years:

2010 2011 2012 2013 2014 2015
62,2 62,0 61,8 60,2 57,8 57,8


The last two years (2014/15) wine consumption in the country is almost stable. But if consumers demographically becomes smaller, it means that the wine consumption per capita has increased somewhat.


Nielsen Company as a result of the poll found that 41% of Russians are choosing global brands of alcohol, 27% – local, to 31%, this factor does not play a significant role.


One man may be duty-free import into the country at a time not more than 5 liters of alcohol.

In March this year vodka output in Belarus decreased to 937 thousand dal, compared to 949 thousand dal in February. In January-March 2016 production of vodka amounted to 2549 thousand dal. In the first quarter of 2015 it was produced 2.579 million decaliters. Thus, the first quarter of 2016 +1.2%. Growth it not call, but some stabilization of recession in the alcohol market of the country observed.


The most popular alcoholic beverage among Russians in the first quarter of 2016 was the vodka, it would prefer 40% of buyers. In second place – the beer (38%), the third – wine (10%) These data are contained in the latest report on the socio-economic situation in Russia, posted on the official website of the Federal State Statistics Service.


Number of Finns traveling to neighboring Estonia only for alcohol greatly reduced: if a year ago, in February and March 81% of Finnish tourists in Estonia mandatory bought an alcohol, but this year the figure was 69% in the same period. The share of tourists, who buy large amounts of alcohol (more than 500 liters per person), reduced by one third over the year.

I want to remind that the tourists from Finland were taken in 2014 and 2015 at 35% of the volume of alcohol retail sales in Estonia.

Czech Republic

The Czechs are moving away from the tradition of drinking beer in bars and restaurants. On this, as reported by Radio Prague, the statistics show. The biggest amount of beer sold in glass containers – 41%. On draft beer now accounts for 37% of consumption. 12% of Czech consumers buy beer in plastic containers. 7% like canned beer. 60% of respondents said that they prefer to consume a traditional Czech low-alcohol drink out of bars and restaurants.

Weekly analytical column of Vadim Drobiz Week May 02 2016 – May, 08 2016 (10)

Weekly analytical column of Vadim Drobiz

Week May, 02 2016 – May, 08 2016

Vadim Drobiz – Head of the Center for Federal and Regional Alcohol Market Research (CFRAMR)

The most quoted in the Russian media expert on the alcohol market of Russia, former Soviet republics and Eastern Europe. The latest news, detailed analysis, commentary, statistical databases on the alcohol market since 2002.

Full versions of the materials published in Russian on the website Vadim Drobiz http://cifrra.info/

Email: alko-pr59@yandex.ru

Recent data on the status of the Russian alcohol market in early 2016 and for the entire 2015


During the year, the share of vodka in the alcohol market of Russia has decreased from 41% to 40.6%, based on pure alcohol. This was reported by Rosstat (Russian Statistics Agency), comparing data on sales of alcohol in the 1st quarter of 2016 with information on the same period last year. The reason for reducing the share of vodka was the fall of its sales, recorded statistics. So, for the period from January to March this year, it has fallen by 4%.

Besides vodka sales for the year fell in the segment of sparkling wines (by 5.7%), as well as in the segment of brandy, and brandy products (by 4.6%).

At the same time, the increased popularity of  still wines, as well as apple and pear cider, mead (an alcoholic drink based on honey) and similar beverages. In the first quarter of 2016 the share of these drinks has risen by 50.9%, as a whole amounted to 0.1% of the Russian alcohol market. (The increase is significant, but from a very low initial base).

The share of still wines has increased over the year from 9.9% to 10.5% (sales, respectively, increased by 0.6%).

As a result, according to the first quarter of this year, the country’s alcohol market is unable to demonstrate positive dynamics. According to Rosstat, in the first quarter of 2016 the sale of all alcoholic beverages decreased by 3% in terms of absolute alcohol.


Enterprises of the Russian Federation in the first quarter of 2016 compared to the same period last year reduced the production of vodka and sparkling wines, but increased the release of cognac (brandy) and beer, from the data of Rosstat. In March 2016, based on year vodka production, it grew by 5.5% – to 4.5 million decaliters, while compared to February 2016 – increased by 41.8%. The production of vodka in the first quarter of this year decreased by 8.3% compared to the same period last year.

Release of sparkling wines and champagne declined in March by 4.9% compared with March 2015 – to 887 thousand decalitres, as compared to February of this year increased by 19.2%. In general, in the first quarter drop in production amounted to 16.7% on an annualized basis.

Release of cognac in March on an annualized basis increased by 7.7% – to 578 thousand decalitres, as compared to March of last year + 38.6%.

Beer production in March on an annualized basis increased by 11.2% – to 72.5 million decaliters, compared with February + 34.2%, while in the first quarter + 5.5%.


Export of Russian vodka in February increased to 117 thousand dal, against 107.2 thousand in January. This was reported by the Federal Customs Service. In January-February of vodka exports totaled 224.3 thousand dal. (This is in terms of pure alcohol). Of these, 72.2 thousand decalitres were exported to the CIS countries and 152 thousand to foreign countries. In December last year, Russia exported 267.1 thousand dal of vodka.

According to the Union of Winegrowers and Winemakers of Russia in growing grapes in the country it is engaged in around 280 specialized farms, of which 61 have the capacity for the primary processing of grapes. Total not less than 86 thousand people are employed in industry. According to forecasts of the Union this year, domestic manufacturers will provide up to 80% (750-800 million liters) of the domestic market in a quiet and sparkling wines. Although only half of the wines will be made from grapes of the Russian. It will save the lovers of these drinks money, because domestic wines rise in price at a slower pace than imported products tied to the rate of dollar and euro to ruble.

The new name – drop in sales?

Example of how to change the name of the alcohol product can affect the level of sales. In connection with the plans of accession of Moldova in the EU there was a need to change the familiar names of Moldovan alcohol products, as required by EU rules. This list includes wine Cagor (Kagor), which has received a new name Pastoral.

Head of Sales and Marketing of Moldovan company Alianta-vin, Wanda Festishina, explains that “… in 2018 the sale of wine Cagor this company are subject to risk, because at that time forbidden to use the word Cagor (Kagor). The company has developed a strategy that would allow gradually accustom consumers to the new name. Currently, on the labels used the two words at the same time: “Cagor (Kagor)” and “Pastoral”. Gradually increase the height of the letters the word “Pastoral”. It began to use one kind of font for both titles. Over time, the frequency of use of the word “Cagor” in the title will be reduced gradually to disappear completely. But we feel that as soon as something is changing – sales are down. We understand that this is inevitable, but necessary step…”

With a similar problem will sooner or later encounter many manufacturers of alcohol in the post-Soviet space, which is massively used names such as Champagne, cognac, sherry, port, madeira, etc.

Krušovice will sponsor the World Hockey Championship in Russia

In Russia, from 6 to 22 May 2016 in Moscow and St. Petersburg will host the next World Hockey Championship. One of the official sponsors of the tournament will be the Krušovice beer (HEINEKEN group). The brand has also been an official partner of this tournament last year, and before the World Cup in the Russian sides extended the agreement until 2019, inclusive.

The status of official sponsor in the “beer” category allows Krušovice place their ads on the sides of the hockey arenas, which will host 64 matches. Krušovice logo will display on all press conferences and screened during the official program. In addition, Krušovice will be the official sponsor of the World Cup matches broadcast on the First Channel of Russian television.

The tournament should be a real media event in Russia, considers the director of marketing for HEINEKEN Russia Jonny Cahill. Broadcast of the last World Cup – 2015 in the Czech Republic have been very popular in Russia: total views exceeded 300 million, and a home tournament will break all records on the size of the audience, he said.

According to Cahill, sponsorship Home World Hockey Championship – a great opportunity to support the brand, which has become one of the fastest growing in the Russian market. Now Russia – the largest market for Krušovice. “Hockey for Russia historically – sport №1. Despite the fact that the attendance and the audience it concedes to soccer, it is in hockey it was won the greatest victory of Russian sport. We are proud that the Royal Krušovice beer has been able to maintain a royal tournament, “- said John Cahill.

Czech hops sold until 2020

Сrops of Czech producers of hops sold for several years, and most of it is exported – mostly to Asia, Africa and South America. Knowing the current area under crops and the average volume of harvest, experts suggest that the entire Czech hops are already sold out till the years 2019-2020. So hop growers will expand crops, because the raw material needed and the Czech breweries. This summer, it is planned to lay 350 hectares of new areas, and a whole planting area reached 4800 hectares. Varieties planted mostly Žatecký Poloraný Červeňák, Sládek, Saaz Late, Kazbek, Agnus and Premiant.

Overall abroad are exported 80% of the Czech hops. Most of all purchases Japan, where many brewed lagers Pilsner type. In addition, the biggest customers are China, Germany, Russia, Italy, Belgium, United Kingdom, Vietnam, the United States and South Africa. In Africa, the Czech hops also buy Zimbabwe, Lesotho, Uganda, Swaziland and Botswana. In South America – Peru, Colombia and Brazil.

Among Czech companies buy most Pilsen Gambrinus.

Recently, consumers prefer a strong beer, and therefore need more hops.

The harvest in 2015 due to the intense heat was unsuccessful – only 4843 tons of raw materials. In addition, the weather affected the quality of the crop. Unfortunately, in the Czech Republic only a quarter of the fields for the cultivation of hops installed irrigation system.

Poisoned, poisoning and will be poisoned?..

How much is said and written in Russian about the poisoning of surrogate alcohol? However, our consumer does not scare any mass poisoning. But whereas this was only marginalized part of population, but now poisoned counterfeit drinks are not afraid and more affluent segments of the population. Every year, Russia’s population drinks more than a dozen million of such bottles surrogate whiskey, rum, gin, tequila, French cognac and etc. Over the last 5-6 years, in Russia has formed a large and stable market production (often in his own garage), sales (mainly in illegal retail) and consumption (normal citizens of the middle and lower-middle income) surrogate Western and Russian premium alcohol. A poisoning while isolated. Even if such products poisoned to death by 5 years of 20-30 people, then we drank during that time at least 50 million bottles a surrogate.

Try to convince the person in danger of the surrogate product, minimally familiar with the basics of mathematics. He will say that the probability of poisoning is negligible and it is certainly not going to happen with him. That’s from such “education” we suffer!

Ban plastic beer packaging – for whose benefit?

Finally, it became clear to whom in reality working those people and organizations in Russia that urge to abandon the plastic packaging in the beer industry. I called even 5 years ago, the most concerned – are producers of glass and metal packaging. At the same time I had not heard about the glass oligarchs in the country. But the oligarchs for the production of aluminum are known to all! One of the largest of them, Oleg Deripaska, offered at a government meeting Prime Minister of the country, Dmitry Medvedev, have the courage to remove the plastic packaging from the beer industry for the support of strategic sectors of the country – aluminum and glass manufacturers. However, even Rospotrebnadzor (Federal Service for Supervision of Consumer Rights Protection) is unable to obtain the appropriate expert opinion about the dangers of plastic packaging.

The Union of Russian Brewers appealed to Deripaska a return letter, which stated that its proposal would destroy the beer industry. I think it will not destroy industry, and not too affects the consumption of beer in the country. Demand for beer for this reason if dropped, is not more than 5%. At present, in Russian in aluminum packaging is done in no more than 20% of the beer – it gave 140 million dal a year.

From polyethylene prohibition metal packaging market will receive an additional about 10% of the beer market in the country – it is about 70 million dal. This increased production of aluminum cans is 1.5 times. This is serious business, for which real capitalist will sell his own mother! (Russian proverb.)

So beer or wine?

For all the novelty and appeal of crafting beer the Russian state and society will have to decide – that today is more necessary in the youth sector of consumption: craft beer or wine?

I personally think that crafting beer takes no more than 10% of the beer market in Russia, and not earlier than in 10 years. That’s about 75 million dal of products which will drink mainly young people under 30 years old. I have no doubt that the brewers will find money on advertising of crafting beer, especially if to that will join Western beer monsters. And the Russian winemakers money on advertising, comparable to beer, was not, don’t and never will be! And we in the coming 10 years will lose another generation of young people. It will also be a beer-generation – and them so in 2 times less in number due to the Russian demographic specifics!

At the same time, once again, I want to emphasize that I do not consider myself an enemy of beer – I’m all for it as a consumer. But for this is such a thing as alcohol policy – reasonable, with specific goals and realistic objectives. And many Russian officials have turned this in anti-alcohol policy. And in the anti-alcohol policy it is prohibited to use brains!!

Sparkling wines and champagne are in Russia more and more unaffordable product, so the Russians are switching to cheaper drinks.

Last year, Russians consumed 230 million of champagne and sparkling wine, which is 15 million liters less than in 2014. Of this amount, the share of Russian products 165 million liters (or 72%). These missing liters Russian consumers replaced with wine fizzy drinks in which no added alcohol. Due to this, they are 30% -40% cheaper than the usual sparkling wines. I believe that in 2016 a further fall of consumption of sparkling wines in Russia will not be.

The price of the bottle of wine: what happened with it in Russia?

I set a goal to compare the average factory selling price per conditional bottle of wine (0.75 l) during the period 2012 – 2015 years, and the 1st quarter of 2016, taken from the report of the Russian statistical agency. The results are tabulated.

Products in rubles 2012 2013 2014 2015 First quarter2016 2016 to2015 2016 to2012
Average conditionalprice of 1 bottle of still wine 45,0 50,0 55,0 72,0 85,0 +18% +89%
Average conditionalprice of 1 bottle of sparkling wine 94,0 102,0 110,0 120,5 138,0 +14,5% +47%

For still wines: the growth of the average bottle price of 1Q 2016 to the average price 2015 – (+ 18%), and to 2012 – (+89%). For sparkling wines price rose (+ 14.5%) compared to 2015 and (+ 47%) to 2012.

In fact, wine production in Russia has risen dramatically in just a few years. The increase in the excise duty rate was low during this period. But have become more expensive all other components of the price.

(Price changes over the same period in the US dollar or the euro is much more difficult to trace, because at different times was a different exchange rate of these currencies to the Russian ruble.)