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FoodAlert - Capturing Key Trends in the Global Food and Drinks Market

 Import dependency of Russian food market highlighted 

Article Date: 24/02/2012 

 

James O’Donnell, Emerging Markets Director, Bord Bia – Irish Food Board

The Russian food market is developing rapidly. In 2009, the market was estimated to be worth $225bn and is expected to grow at a compounded rate of 20.5% by 2013. By 2015 Russia is expected to be one of the top five grocery markets in the world.

The industry is heavily dependent on imports with the majority of raw materials and ingredients used by Russian food processors being imported due to insufficient domestic supply. According to the Federal Customs Service, the value of this sector totalled $25.8bn in the period January-August 2011. In the meat processing sector for example, 70% of the raw materials are imported. Within this category, there is an increasing emphasis on ‘natural’ ingredients. This creates an opportunity for Irish products that have the advantage of carrying the ‘green’ image.

The dairy products market in Russia is currently valued at $16-17 billion and is growing annually by 7-9%. The main players within this market are Wimm-Bill-Dann and Unimilk with imports playing a vital role. In 2010, 255,000t of dairy products were imported and in major Russian cities over half of the milk products consumed are imported.

With Russia becoming a member of the World Trade Organisation, the opportunity now exists for Ireland to trade more actively in Russia with fewer barriers to entry.



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