Experts explained the futility of sanctions against beer supplies to Russia

Since the beginning of the year, the import of low-alcohol alcohol into the country has grown by more than a third

Deliveries of beer to Russia for the first half of the year increased by almost 35%. Germany remained the largest importer, from where almost half of this product is shipped. The leaders are also Belgium, the Czech Republic and China, Kommersant writes. What caused such a significant increase in demand for a foamy alcoholic drink among Russians and why, despite severe economic restrictions, European states continue to supply beer to our country, MK found out.

After the events of February 2022 and the tightening of Western sanctions, difficulties arose with the import of beer. Companies from Great Britain, the USA and Canada have stopped deliveries of the beer to Russia. However, judging by the figures, not all representatives of unfriendly countries followed suit. Thus, Germany remained the largest supplier of beer to Russia. Its shipments of this product increased by 46.4% and reached 102.7 million liters. Belgium also increased imports of barley drink to 19.4 million liters. The deliveries of beer from the Czech Republic and China also increased. In other words, most of the positions in the rating of suppliers of foamy alcoholic beverages to Russia were retained by countries that are unfriendly.

Experts explain their reluctance to follow in the wake of modern geopolitical upheavals in different ways. “Restrictions on the import of beer and other alcoholic products apply to items more expensive than 300 euros per can or bottle,” says Svetlana Avdasheva, professor at the HSE Faculty of Economics. “Well, yes, such beer does exist, but it is obvious that the main share of imports is made up of products with more modest prices.” So there is no talk of circumventing sanctions. At the same time, according to the expert of the Moscow branch of the All-Russian public organization “Support of Russia” Vyacheslav Belobzhetsky, there was a redistribution in the market and more eminent brands gave way to lesser-known representatives of the same countries. “Today, with supply chains being rebuilt and large international suppliers gone, there is an opportunity to source from smaller manufacturers in Europe,” he says. — For them, the political component in business is not so important, especially if they are local producers. Accordingly, they are ready to supply where there is demand.”

Experts also argued about the reason for such a tangible increase in the supply of foam products to Russia. One group of analysts argues that the increase in imports is broadly in line with demand, with Russia booming domestic tourism and actively stimulating consumption. “Part of domestic products was “attracted” by hoteliers working on the all-inclusive system, which, according to the new rules, must ensure that the bar has at least one type of domestic beer,” believes Associate Professor of the Department of Informatics of the Russian University of Economics. G. V. Plekhanov Alexander Timofeev. Well, the missing volumes on the store shelves were occupied by foreign brands of foamy alcohol.

The situation with closed borders for the rest of Russians abroad as a whole had a very strong impact on the demand for barley drink. So, according to Belobzhetsky, beer consumption is also affected by the decline in international tourism to Europe – now what is consumed outside the country is now consumed.

However, another group of analysts sees the reason for the significant increase in demand for beer in the global transformation of the behavior of compatriots. “In Russia, there is a long-term trend of changing the structure of consumption of alcoholic beverages,” says Avdasheva. — Research by Yana Roshchinina from the Higher School of Economics and co-authors has shown for several years a significant shift in Russian alcohol consumption towards the Mediterranean model: more wine and beer, less strong drinks. So in Russia, beer consumption is replacing vodka consumption, refuting stereotypes about Russians as a people who prefer vodka to all drinks.”

The third group of experts believes that purely economic phenomena are to blame. Thus, according to Alexei Nebolsin, an independent expert on the alcohol market, there is nothing strange in the increase in the import of barley drinks: since there were no direct sanctions on the import of foreign beer brands into Russia, importers blamed high energy prices for the local decline in sales, which made production more costly. Now suppliers are trying to make up for the lost share in the Russian market and, accordingly, increase their income. “Demand for Irish Guinness and Kilkenny from domestic connoisseurs has been preserved, which is well understood by foreign producers. The latter do not care deeply about the multiplying Western obstacles – they are guided by economic, not geopolitical aspects. It is profitable for importers to send large batches of beer in Russia, especially since our consumers still have a demand for products that have long been loved by them. There is a dialogue between businessmen, not between diplomats, therefore, despite the sanctions, first of all, European brewers do not miss the opportunity to fill the market with their own, more attractive and liquid products,” the expert explains.

However, there are also less optimistic nuances of growth in foreign beer purchases. “Two years ago, the share of imported beer in Russia did not exceed an insignificant 5%, which corresponded to export deliveries from our country. The foreign trade turnover for these alcoholic products was equivalent. Now even an increase in foreign purchases does not yet compensate for previous failures. The noted explosive growth is just one of the moments of the recovery of the imported beer market in Russia, which still continues to lag far behind the results of previous years,” Vadim Drobiz, head of the Center for Research on Federal and Regional Alcohol Markets, believes.

Representatives of the Russian industry are still cautious about a significant increase in prices for imported beer. On the one hand, at the end of 2021, the Union of Russian Brewers proposed to the Ministry of Economic Development to increase the duty on imports of foreign products by several dozen times (from 2-4 euro cents to 1 euro per liter). Through such a protectionist measure, they were going to nullify the advantages provided to foreign manufacturers. True, such a proposal has not yet been confirmed by legislative acts.

Meanwhile, according to private owners of breweries, parallel imports through Armenia or Kazakhstan, which are currently used by domestic buyers of imported beer, just in case, contain a lot of regulatory circumstances that contribute to the completely legal distribution of products in supermarkets. Each bottle can be affixed with its own brand of a trade enterprise, thus protecting the products from any external and internal state influence. The quality of the drink does not suffer due to such perturbations, and the consumer is satisfied – the cost of the goods grows slowly and does not outstrip inflation, so that the availability remains at its former level.