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Top Growth Opportunities: Dairy & Soy Food in Russia

Top Growth Opportunities: Dairy & Soy Food in Russia

Summary

Russia currently ranks sixth by per capita expenditure in US Dollar terms among the top ten Dairy & Soy Food growth opportunities. Average consumer spend in Russia is currently in the recovery phase following two years of recession and mounting pressure on household incomes, while exchange rates make comparisons between Russia and other markets problematic and prone to misinterpretation. Russia's Dairy market is forecast to experience high growth in per capita dairy and soy consumption as consumer spending and investment in business increase, making it a clear long-term growth market.

Russia’s economy is set for a return to modest growth in 2017 following two years of recession. The Dairy market is expected to benefit from this wider economic recovery, posting a CAGR of 8.7% in the five years to 2021. This follows a period of negative growth in US Dollar terms which saw the market contract 9.6% between 2011 and 2016. A series of tit-for-tat economic and trade sanctions between the EU, US, and Russia in the wake of the Ukraine crisis in 2014, combined with a rapidly depreciating ruble, have actually boosted the development of domestic business by encouraging import substitution and making exports more competitive. Russia is now the world’s biggest exporter of grains and produces its own pork and chicken.

Despite negative growth in US Dollar terms in the five years to 2016, Russia’s Dairy market is stable and growing steadily, with a value projection of US$28.6 Billion by 2021. This growth is underpinned by several factors, including a modest recovery in household incomes and more favorable business climate for producers and exporters in key industries, such as agriculture and related sectors.

Off-trade Dairy consumption accounts for almost 70% of overall market value, reflecting the trend for at-home consumption in Dairy. Overall US$ market value contracted at a CAGR of -9.59% between 2011 and 2016, reflecting currency movements and reduced consumer spending. Both off- and on-trade consumption recorded negative value growth due to the drastic depreciation of the Russian ruble’s position against the US Dollar between 2011 and 2016. Exchange rates aside, market value has grown steadily during this period, and there are opportunities for investment in both areas of the market as household incomes continue their modest recovery after two years of recession.

The report Top Growth Opportunities: Dairy & Soy Food in Russia provides recommended actions and detailed analysis of how to target the best growth opportunities for dairy and soy food producers and retailers. Readers can understand what categories, channels, companies, and consumers will drive the success of dairy and soy food markets in Russia.

Specifically, this report provides the following -

  • Key consumer demographic groups driving consumption within the Russian market. Improve your consumer targeting by understanding who’s driving the market, what they want, and why.
  • A study of market value and volumes over 2011-2016 for Russia, supplemented with category, brand and packaging analysis that shows the current state of the market, and how it will evolve over the 2016-2021 period.
  • White space analysis, to pinpoint attractive spaces in the market and the key actions to take.
  • Insight into the implications behind the data, and analysis of how the consumer needs will evolve in the short-to-medium term future.
  • Examples of international and regional product innovation targeting key consumer needs.
Companies mentioned in this report: Magnit, Auchan, X5 Retail Group, PepsiCo, Danone, Valio, Groupe Lactalis, Savushkin Product, Karat Zao, Hochland AG, Molvest Zao, Milkiland, Alekseevskiy MKK, President, Actimel, Castelli, Prostokvashino, Domik V Derevne, Vesely Molochnik, Bio Balance, Takanashi Shibo, Forager Project, Vitako, Imunele For Men, Agusha Zasypay-ka, Parmalat, Danone Activia, Bonfesto, Vkusnyi Standart, Volko Molko, Epica, Deluxe, Devinos, Danone Danio.

Scope
  • Despite negative growth in US Dollar terms in the five years to 2016, Russia’s Dairy market is stable and growing steadily, with a value projection of almost US$30 billion by 2021. This growth is underpinned by several factors, including a modest recovery in household incomes and more favourable business climate for producers and exporters in key industries.
  • Despite recording negative growth in US$ value terms due to the effect of currency movements, the Russian Dairy & Soy Food market registered steady growth in volume between 2011 and 2016.
  • Cheese and Milk, the two largest segments in value and volume terms in 2016, are forecast to register impressive growth in the five years to 2021, while Cream is forecast to record the fastest value growth.
  • Off-trade distribution channels together account for almost two thirds of Dairy & Soy Food consumption in Russia, although On-trade is the largest single channel by 2016 market value share.
  • The top three brands across all segments saw their collective average value share remain constant between 2011 and 2016, demonstrating that consolidation in the Russian Dairy market has slowed in response to reduced consumer spending and private label gains.
  • The value share of private label is growing faster than that of brands across all segments in the Russian Dairy market, highlighting a move among consumers towards private label products, which are often cheaper but increasingly perceived to be of equal value to brands.
Reasons to buy
  • This report brings together consumer analysis and market data to provide actionable insight into the behavior of Russia's dairy consumers.
  • This is based on GlobalData's unique consumer data, developed from extensive consumption surveys and consumer group tracking, which quantifies the influence of 20 consumption motivations in the Dairy sector.
  • Category, brand, and packaging dynamics are also examined.
  • This allows product and marketing strategies to be better aligned with the leading trends in the market.


  • Introducing a top growth market for Dairy
    • Top opportunity markets
    • GlobalData Consumer's opportunity scoring methodology
    • Top 10 global growth opportunities scores
    • Top global issues
    • Assessment against global strategic issues
    • GlobalData's strategic issues map
    • Predicted future issues for the Global Dairy sector
    • Russia reward and risk assessment
    • Opportunity score - Russia Overview
    • Consumer dairy spending trends - peer group comparisons
    • Political, Economic, Social and Technological: Analysis
    • Enablers and inhibitors of growth
    • Dairy & Soy Food - Rewards and opportunities for growth
      • Table Market value of Russia's Dairy & Soy Food market, 2011 - 2021
    • Summary of the Dairy market in Russia
  • Market insight - identifying the opportunities to move into
    • - Market growth by category
    • Value growth of the Russian Dairy & Soy Food market by category
    • Contribution to change by value
      • Table Category values (US$ millions)
    • Volume growth of the Russian Dairy & Soy Food market by category
    • Contribution to change by volume
      • Table Category volumes (millions kg)
    • Level of premiumization by category
    • Category analysis - key drivers of change in Dairy
  • Retail and distribution insight - key channels and retailers driving growth
    • Dairy & Soy Food retail channel share - Russia
    • Key Retail Channel trends
    • Routes to market - retail overview
    • Routes to market - key retailers
    • Drivers of change in the Dairy sector
  • Company and brand insight - the competitive landscape defined
    • Dairy & Soy Food category fragmentation
    • Company and brand strength
    • Private label penetration
    • Brand Share by leading supplier for total Dairy
    • International and domestic brand analysis
      • Table Top 5 international Dairy & Soy Food brands
      • Table Top 5 domestic Dairy & Soy Food brands
    • Company and brand strength
  • Consumer insight - who, what, when, where and why
    • Strategic issues map - pitfalls and opportunities
    • Strategic issues map - key consumer trends affecting market strategy
    • Key consumer drivers for Dairy
    • Key consumers trends in the Russian Dairy market
    • Consumer Groups - Key consumer targets
    • Consumer Groups - key consumption motivators
    • Key Health & Wellness trends
    • How Health & Wellness benefits will contribute to growth
    • Penetration of Health and Wellness claims by category
    • Consumer trends summary
  • Product and packaging insights -
    • Key Product Insights in Dairy
    • Trends and strategic issues - other notable product trends
    • Product & Packaging insights - Key product innovation case studies
    • Key product innovation case study: Epica - Yogurt - Krasnyi Apelsin
    • Key Packaging Insights
    • Trends and strategic issues - packaging material trends
    • Trends and strategic issues - packaging closure
    • Product launch key takeouts
  • White spaces and innovation opportunities - space to move into
    • Highest growth segments to target when entering the Russian Dairy market
    • Consumer spaces to target when entering the Russian Dairy market
    • Segment focus - opportunities
    • Price change by category in the Russian Dairy market
    • Pricing strategies - movements in average prices for leading brands
      • Table Monthly average price point, US$
    • Product launch key takeouts
    • Recommendations for new ways to enter the Russian Dairy market
  • Appendix
    • Definitions
      • Category Definitions: Loose & Unpackaged sales are not tracked
      • Category Definitions: Butter & Spreadable Fats
      • Category Definitions: Cheese
      • Category Definitions: Cream
      • Category Definitions: Dairy-based & Soy Desserts
      • Category Definitions: Drinkable yogurt
      • Category Definitions: Fromage Frais & Quark
      • Category Definitions: Milk
      • Category Definitions: Soymilk & Soy drinks
      • Category Definitions: Yogurt
      • Channel Definitions
      • Product Attribute Definitions: Food Minus
      • Product Attribute Definitions: Functional & Fortified
      • Product Attribute Definitions: Naturally Healthy (NH)
      • Product Attribute Definitions: Food Intolerance (FI)
      • Accreditation Definitions
      • Consumer Benefit Definitions: Performance
      • Consumer Benefit Definitions: Health Management
      • Consumer Benefit Definitions: Weight & Shape Management
      • Consumer Benefit Definitions: Beauty From Within
      • Consumer Benefit Definitions: General Wellbeing
    • Research Methodology
      • Consumer Packaged Goods Retail Data
      • Health & Wellness data is built using detailed store audits in combination with market volumes from GlobalData's market data research
      • Online Price Intelligence Methodology

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