Customer Logins

Obtain the data you need to make the most informed decisions by accessing our extensive portfolio of information, analytics, and expertise. Sign in to the product or service center of your choice.

Customer Logins

Article:Russian food self-sufficiency programme is succeeding

20 August 2020

Domestic food production now accounts for more than 80% of retail sales, up from 60% in 2014.

In 2018, the Russian Government announced a USD51 billion plan to boost domestic agricultural production, setting the ambitious goal of increasing food exports by 70% (to USD45 billion) by 2024

The weak rouble and relatively stagnant consumer purchasing power generally discourage imports, says a new USDA report, adding: "However, Russia's food processing industry is modernising to better serve domestic consumers and a growing number of strategic trading partners."

While imports of consumer products have fallen by more than one-third since 2013, Russia remains a net importer, and continues to rely on foreign supplies of fresh and dried fruit, nuts, vegetables, beef, dairy, wine, spirits, food ingredients, and processed foods, including condiments, snacks and juices. Since 2014, imports have shifted from European to Asian, Middle Eastern and Latin American suppliers.


Russia is Europe's third largest consumer market by turnover, behind only Germany and France. Its domestic food processing industry and developing food retail sector contributed significantly to the economy over the last five years. According to the Russian State Statistic Service (RosStat), in 2019, the production of food products grew by 4.9% and food drinks by 3.1% compared with 2018. Retail trade turnover in the Russian Federation in 2019 increased by 1.6% in comparable prices to RUB33.5 billion (USD465.7 bln).

In 2019, the turnover of Russian food retail industry grew by 1.4% to RUB16.1 bln and the share of the top 10 fast-moving consumer goods (FMCG) chains in the retail food market increased to 32.9%.

The acceleration of market consolidation is associated both with the continued high growth rates of the major retail chains and M&A activity. Because of slim profit margins, the USDA says that most industry observers predict continued consolidation in the retail sector.

In 2018, consumer behaviour changed from saving to 'lean' consumption. In 2019, consumers maintained this pattern amid a record level of promotional activity from the largest FMCG chains and an accelerated transition of retailers and suppliers to an omnichannel business model, which provided customers with a seamless experience whether they are shopping online from a mobile device, laptop or a bricks-and-mortar store.

Convenience is becoming one of the key priorities for consumers, which has stimulated the development of e-commerce and negatively affected sales in large-format shopping facilities.

In the retail food market, the discounter format is increasing. To attract consumers, retail chains are introducing large-scale promotions even though this results in lower margins and profits.

"This increasingly tough competition will probably lead to regional and interregional players going out of business," says the USDA.

Consumer Trends

Russian consumers continue to economise, buy rationally with minimal impulse purchases, and also look for healthy, natural, innovative and fashionable products at affordable prices. According to a GfK survey, last year, 46% of Russians said they were looking for a way to save money and use special offers for this purpose, 54% of Russians say they are looking for stores with low prices.

Russian consumers appreciate convenience so ready-made food is gaining popularity and becoming an alternative to traditional home cooking. According to GfK, half of all consumers visit bakery and pastry shops, a quarter go to fast-food restaurants or cafes and one-fifth order food for delivery at least once a month.

In Moscow, St. Petersburg other major cities, demand for ready-made meals is growing. In 2018, ready-to-eat meals, such as frozen, pre-cooked lasagna or soups, grew in Moscow by 18%, and in St. Petersburg by 12%.

Health concerns

Another significant trend is increasing interest in a healthy lifestyle. Russians are increasingly worried about their own health. According to Nielsen, more than 84% stated that they recently changed their eating habits, such as: 53% reduced fat intake, 65% reduced sugar, and 67% increased the share of natural and healthy foods in their diet.

More often, Russian consumers are carefully calculating calories, more attentively looking over the ingredients, and purchasing products with less artificial ingredients, less fat and less sugar. A wide selection of healthy food has become an important factor when choosing a store. Almost all federal retail chains have a section for healthy products.

Russians are becoming increasingly interested in farm products and organic/ecological foods. In 2019, sales of such products in the Russian market exceeded RUB900 bln, according to Euromonitor.

Russian consumers are increasingly buying food and drinks via the internet, especially in big cities and major regional centres. According to Euromonitor, food and drink internet retailing grew 20% in 2018, to RUB46.4 bln and is forecast to reach RUB115 bln in 2023.

View more articles



Follow Us

Jun 01

RT @SPGlobal: June marks the start of Pride Month, where we commemorate and celebrate the LGBTQ+ community in countries across the globe. S…

{"items" : [ {"name":"share","enabled":true,"desc":"<strong>Share</strong>","mobdesc":"Share","options":[ {"name":"facebook","url":"","enabled":true},{"name":"twitter","url":"","enabled":true},{"name":"linkedin","url":"","enabled":true},{"name":"email","url":"?subject=Article:Russian food self-sufficiency programme is succeeding | IHS Markit &","enabled":true},{"name":"whatsapp","url":"","enabled":true}]}, {"name":"rtt","enabled":true,"mobdesc":"Top"} ]}
Filter Sort