27th International Food Exhibition
17–20 September 2018 • Expocentre, Moscow, Russia

German food & drink’s place in the Russian market

News
Germany exports more food and drink items to Russia than any other EU nation – and sanctions don’t seem to be diminishing Deutsche dominance. Compared with other countries, Russia’s import market is far from closed to German produce.
German food & drink’s place in the Russian market
 
Volumes may have dropped over the past four years as previously big-value export products, like pork, are under Russian embargo – but don’t be disheartened. According to data from the online MIT Atlas of Economic Complexity database, Germany’s collective food and drink exports to Russia in 2016 totalled $990 million – and that’s when sanctions were hitting their hardest.
 
Germany and Russia appear to be on the road to normalisation, trade-wise, with Germany’s Russia-destined exports rising 21% between January-November 2017. At this time, total exports stood at $29.3 billion.
 
The other bit of good news for German exporters is the fact Russian food and drink imports are growing once more. In 2017, Russia imported 11.4% more food, hitting a total of $27.9 billion – the first such rise in three years.
 

A look at the German-Russian food trade

 
Before we examine the best opportunities for German food and drink manufacturers in Russia, let’s take a look at the existing food trade. 
 
According to MIT data, taken from Germany’s own national statistics service, 2016 saw Germany export close to a billion dollars in foodstuffs and drinks to the Russian market.
 
It’s worth pointing out that many of Germany’s biggest export products remain under sanction in Russia. However, this is not the whole story. There are many sectors, when combined are worth many billions of dollars, that are still wide open to German brands. Click here to learn more.
 
Whether supplying the raw materials needed for Russian producers to concoct their own goods, to pure consumer focussed products, Germany has a lot to offer food wise. The below are Germany’s top export items to Russia:
 
Chocolate & chocolate confectioneries - $108m
Coffee & tea extracts - $77.5m
Baked goods incl. bakers ware - $55.3m
Beer – $34.8m
Coffee – $30.5m
Spirits - $28.9m
Sugar confectioneries - $28.8m
Cocoa powder - $27.2m
Sauces & seasonings - $20.7m
Wine - $14.4m
 
From the above, we can see that it’s a bit of a mix, from ingredients through to finished products. There is one major thread linking these products – the fact they are not under embargo in Russia.
 
We know what Russian importers are buying from German firms, but are they the best market prospects? Let’s look at some sectors where German produce can really shine.
 

Confectionery: a major export group for German brands

 
Since the invention of the world-famous gummi bear, German sweets have found favour across the globe – and they most can most certainly enjoy the same happy reception in Russia.
 
Consumption and imports of candies started climbing again in 2017 in Russia. At that time, its citizens consumed 24.5 kg of chocolate, sugar candies and flour-based sweets – 6% higher than the previous period. This was against a 25% rise in import volumes between 2016 and 2017.
 
Chocolate, a German speciality, saw the biggest, most encouraging growth in volumes brought in from foreign suppliers of 37%. This resulted in shipments weighing in at 27,500 tons.
 
Western Europe covers 65% of all foreign chocolate bought by Russian buyers, so its reputation nationwide is well founded.
 

Wine and beer offer more market entry points

 
Alcohol and Russia are close bedfellows. Drinking is an essential part of Russian culture. As many as two thirds of the state’s 143.9 million population consumes alcohol at least twice a week. Russians do enjoy a drink – and this, like confectionery, has experienced rising import volumes.
 
Between Jan-Feb 2017, for instance, volumes were up 58% compared with the previous period’s stats. Indeed, German brewers enjoyed their own mini-renaissance between 2016 and 2017. Then, German beer exports grew by an astounding 96%.
 
Collectively, alcoholic drinks is an import sector worth in excess of $1.6 billion in Russia. 
 
German brands can uncover market space in the two expansive product groups: wine and beer.
 
Wine is an exceptional market in Russia right now. Total foreign wine imports in 2016 hit $693 million following 4.5% growth, with sparkling and table wines hitting 174.7 million litres and 34.8 million litre volumes respectively. 
 
Sales of imported wines are expanding again as the Russian economy rebounds from its recent troubles. For instance, Dixie, a major Russian supermarket chain, noted a 5% rise in sales of foreign labels across 2016.
 
Let’s turn to beer now, which is well on its way towards becoming Russians’ alcoholic drink of choice, controlling 45% of the market. And German brands continue to enjoy a sizable market presence. Spaten and Franziskaner were the most popular imported brands in Russia across 2015.
 

German brands: find your market opportunities at WorldFood Moscow

 
The Federal Republic of Germany will be represented with its own National Pavilion at WorldFood Moscow, Russia’s leading food and drink exhibition, in 2018 – and we’d like your business to take part.
 
As part of the German National Pavilion, you get a big advantage over your competition. Benefits include:
 
A ready-made stand complete with a highly attractive design
Representation for your company under the coveted “Made in Germany” brand
On-site management from IEC Berlin
Access to WorldFood Moscow’s Pavilion Lounge for client meetings and complimentary refreshments
 
WorldFood Moscow is Russia’s premier food and trade show. For over 25 years, it has been connecting thousands of top Russian buyers with international food and drink manufacturers. 
 
96% of visitors are directors, CEOs, managers, and other key decision makers
84% of visitors’ purchasing decisions were influenced by the products at 2017’s show
80% of visitors intend to buy from WorldFood exhibitors
 
Want to take part? Closing dates for applicants is 15 May 2018 – so please act fast to avoid disappointment.
 
Contact Claire Porter, Business Development Manager for DACH countries, to secure your space.
 
Claire Porter
T: +44 (0) 207 596 5290
E: fm@ite-events.com