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 GWS takes in-depth look at Russian market ? full report now available to members.

In the wake of recent events in Georgia, Global Wine & Spirits has been interested in understanding the changing dynamics of the Russian wine market from the standpoint of both supply and demand. We are now publishing the second in a series of national reports available exclusively to Global Wine & Spirits members. Here is a brief summary of our report on Russia.

The Russian wine and spirits marketplace continues to evolve. In recent years, there has been a trend towards consolidating the alcoholic beverages industry through a strengthening of the major players, enabling them to develop new product lines and penetrate new geographic areas. It is important to note that the alcoholic beverages industry is still highly dependant on the political and economic situation (financial guarantees, problems with liquidity and the banning of imports from Moldavia). Internationally, Russia is only 12th in terms of wine consumption, but with 38% annual growth in 2006, the outlook is excellent. The ban on imports from Moldavia and Georgia has created a new set of rules for the market and established Russia as a niche market for other exporters. As a result, many suppliers are competing for a place in the growth of wine exports to Russia.

The Russian market is composed of a wide range of products ranging from low- to high-end. Producers are being asked for ever more stringent quality guarantees in an effort to improve the overall quality standard of the wine industry. While the low-end market continues to dominate, a growing preference for mid-priced wines is perceptible as wine becomes established as a status symbol. In the coming years, Russia needs play an active role in providing wine education and in making the product more accessible to all consumers. Moreover, marketing policies should be implemented to promote the everyday health benefits of wine compared to hard spirits. At the same time, major discrepancies remain in consumption practices between the major urban areas and other regions of Russia.

The current growth in wine consumption is part of an overall change in wine and spirits consumption habits. Russians tend to prefer either sophisticated brands of wines or refreshing drinks such as beer over hard spirits, whose consumption has been declining for a few years now. Finally, imported wines have been gaining market share in recent years, showing steady annual growth in overall consumption. This is especially true of New World wines, which more closely meet Russian expectations in terms of consumption criteria (i.e., low-price, sweeter varietals, and so forth) than do Old World wines, which continue to dominate the high-end market.

Contact Global Wine & Spirits directly for our full up-to-date report including consumption and distribution statistics and trends, a complete summary of import and labelling rules, as well as lists of key importers and distributors. Write to us at