Table of Contents
Growth potential in the Russian Food and Beverage Market
The Russian fruit and berry fillings market comprises four segments: diary, confectionery, ice cream, and HoReCa, all of which have moderately high margins and growth potential. There are high entry barriers for new participants due to the lack of reliable purchasing channels of raw materials and sales opportunities of finished products. The study provides a detailed export-import analysis of the market as well as domestic production data based on numerous reliable primary sources. The base year is 2014 and the forecast period is 2015-2020.
Key Findings of the Russian Fruit and Berry Fillings Market
- The size of the fruit and berry fillings market in Russia was thousand tons in 2014, including the fillings produced by some companies (mainly in the dairy and confectionery industries) for their internal consumption as a part of a full production process.
- The current actual capacity of the market (if provided quality appropriate product) can be estimated at
- % higher than actual consumption. However, there is a slight shortage of supply:
o This gap in the supply is due to a shortage of raw materials (fruits and berries) resulting from sanctions applied by the European Union (EU) on some imports.
o There is no shortcoming in production lines’ capacities. In fact, in 2014, there was on an average % idle production capacity in the market.
- The main end-user industries of the fruit and berry fillings market are the dairy industry, which consumes over % of the total market product, and the confectionery industry, which has a %
- Import of fruit and berry fillings in Russia decreased significantly over the past years and currently amounts to % of the total market or thousand tons.
- While the import segment of the market will continue to decline, there will always be at least some demand for premium imported products in the dairy, confectionery, and HoReCa.
- The export segment in the fruit and berry fillings market in Russia amounts to about % (or thousand tons) of the domestic consumption segment and is mainly directed at other nations in the Commonwealth of Independent States (CIS). This segment does not have significant growth potential.
- Russia is highly dependent on imported fruits and berries due to the following reasons:
o Russia’s climatic conditions do not allow for several harvests in a year
o Lack of sufficient raw materials (for instance, some exotic fruits can only be obtained through imports)
o Underdeveloped cold chain system (that is, field - storage - delivery – processing)
- The market works in accordance with a principle of “customer proximity”. The Moscow region is responsible for more than half of all fruit and berry fillings production in Russia even though Krasnodar
region provides times more fruits than the Moscow region.
- There are about dozen manufacturers in Russia whose core business is the production of fruit and berry fillings. Apart from that, every fruit and vegetable cannery produces similar products. However,
their total contribution to the domestic business-to-business (B2B) segment does not exceed % of the total market share.
- The market is consolidated; the top market leaders, namely, Agrana Fruit, Zuegg Russia, and Gummi were responsible for more than half ( %) the total domestic production in 2014.
- There is no horizontal integration (integration of businesses through mergers or acquisitions) in the market which is associated with the early phase of market development; major acquisitions (primarily
dairy companies, small regional players) might happen in future.
- Vertical integration happens only in direction from an agricultural business with a less value-added to filings production, not the opposite (examples: Gummi, Bogucharovo).
Packaging in the B2B Segment of the Russian Fruit and Berry Fillings Market
- Basic requirements applied to packaging of fruit and berry preserves and semi-finished products are regulated by GOST P 53959-201, which applies to the packing, marking, transportation and storage of
processed fruits, vegetables and mushrooms.
- Sterilized fruit and berry fillings are packed in sealed shipping containers; unsterilized fillings (with preservatives) are packed in non-sealed transport containers.
- State standards describe information on recommended transport container means; a mandatory requirement is the use of packaging authorized for food.
- Recommended containers for fruit and berry fillings:
o Wooden, metal, or polymer barrels with or without liners
o Boxes made of wood and wood materials
o Cardboard boxes with a liner made of a polymer material
o Aseptic capacities or capacities with an aseptic liner
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