Beer crossed the border

The range of foreign beer brands on the Russian market, which had drastically declined after the outbreak of hostilities in Ukraine, began to grow again. At the end of 2022, the average number of import positions in retail chains increased from 18 to 22 units. This was facilitated by the solution of problems of distributors with payment, logistics and the expansion of brand portfolios. But imported beer has become significantly more expensive than local, which limits the demand for this segment.

The average number of positions (SKU) of imported beer in the assortment of retail chains in October 2022 began to grow after falling in spring and summer, follows from a NielsenIQ study. According to analysts, from January to September, the number of imported beer SKUs on average decreased from 35 to 18 positions, and in October—December it increased to more than 22 SKUs. The representation of beer under global brands, produced in the Russian Federation under licenses, in the fourth quarter decreased from more than 54 to 52.5 positions. And the range of local brands has increased on average from about 78 to 80 SKUs, according to NielsenIQ. According to analysts, at the end of 2022, local beer brands accounted for 48.1% of the assortment, licensed ones – 33.4%, imported – 16.6%.

Imports of beer to Russia declined after the outbreak of hostilities in Ukraine and the tightening of Western sanctions. According to market participants, companies from the UK, the USA and Canada stopped deliveries, while some enterprises from the Czech Republic, Germany and Belgium continued to ship. According to Igor Khavsky, the co-owner of the SWAM Group distributor, in 2022, beer imports in the Russian Federation decreased by 30-35% year-on-year. In 2021, deliveries were at the level of 50 million decalitres.

Kommersant’s interlocutor in the beer market says that, in addition to the departure of some suppliers, the import of beer last year was complicated due to problems with payment and logistics, and in the summer a large number of import positions washed out of the assortment of stores. According to him, in September-October, importers found new partners, banks, logistics solutions and supplies recovered. In addition, some distributors have begun to expand their portfolio, for example, with beer from China.

Igor Khavskiy confirms that some of the difficulties with imports have been resolved. For example, beer is purchased from European distributors and delivered to Russia through third countries, he says. But, adds Mr. Havsky, the cost of goods is growing, which negatively affects sales, and the gap with the price of local beer is likely to increase. According to NielsenIQ, as of December 2022, imported beer cost more than 200 rubles on average. for 1 liter, issued under license – over 120 rubles. per 1 liter, and local brands – less than 100 rubles. for 1 liter

Nikolai Zhelagin, the founder of the Beru Vykhodny chain of beer stores, says that the largest drop in sales of imported brands was observed in the summer of 2022, and the dropped volumes were replaced mainly by local brands. In recent months, he notes, imports have been gradually returning. The demand for Czech and German brands, which previously belonged to the “second tier”, has grown, and brands have also appeared on sale, the manufacturers of which refused to supply to the Russian Federation, but about 1.5 times more expensive than before, says Mr. Zhelagin.

Acting President of AB InBev Efes (brands Velkopopovicky Kozel, Old Miller from a Barrel, Sibirskaya Korona, Klinskoye, etc.) Oraz Durdyev attributes the growth in the number of imported beer SKUs to the diversity within the segment, the share of which in any case continues to decline . “Distributors switch from one import brand to another depending on what they can find,” he says. The slight decrease in the number of SKUs of licensed brands, continues Mr. Durdyev, is due to the washing out of brands, a decrease in focus and marketing investments, as well as a drop in purchasing power.

In 2023, Oraz Durdyev expects the launch and development of local beer brands, as well as the growth of the flavored beer segment. And Nikolai Zhelagin notes that the price factor remains the main one for the consumer. According to NielsenIQ, in 2022, only local beer brands increased the share of natural sales, from about 66% to almost 68%.

Anatoly Kostyrev