Sausages Lose Popularity in Russia

Sausages Lose Popularity in Russia

According to the analytic report of marketing specialists, the sausage market decline was 12% last year. This decline is significant, especially considering the steady consumption in this sector during the last few years. Russian consumers use all types of convenience foods in their diet: Vienna sausages, bratwurst, ham, raw smoked and dry-cured sausages, such convenience foods as sausages for frying, and delicacy products. 90% of the Russian population consume different sausage products, therefore the consumption volume decrease by 540,000 tonnes has significantly affected the market.

The imports also showed a negative momentum: minus 17% in 2017. However, it’s highly unlikely that Russian producers will cry over that market segment, because the import has only a small share in the total volume. The import substitution in the production of sausages and convenience foods has been successful, and most of the products have been made by Russian producers. The companies even exhausted their capacity.

This information was provided by the Association of Bidding Participants based on the results of the closed analytic report. The ABP’s experts also believe that there is still available place for Russian companies. Currently, there are small supply volumes by Belarus, Serbia and Kazakhstan. If those supply channels are eliminated, those places can be taken by the Russian producers, said the ABP’s representatives.

The sausage market decline has begun several months ago, after the decrease in the real income of the population. This trend has been increasing during the last few years. According to the official statistics, the incomes of the Russian population have decreased by 0.7% in 2014, while in the next years, the fall has accelerated by 3.2% and after that by 5.9%. Therefore, the incomes have already decreased by 10%, which has negatively affected the convenience food consumption.

Megaresearch’s experts noted in their research that “there was a change in the behaviour of the consumers. People are more interested in healthy foods and prefer pure meat, although some consumers still buy sausages, but with lower quality”. The market situation is further complicated by the rising electricity and water utility prices, transport costs and the unfair competition among the producers.

Broadly speaking however, the situation is good for the sausage producers, said the Megaresearch’s experts. They expect that the incomes of the population will recover and the consumer demand will normalize. Additionally, when the period of adaptation of the companies to the new market conditions is over, it will lead to the end of the crisis. The Ministry of Economic Development of the Russian Federation already saw signs of improvement in its official forecast for the period until 2020. If the basic trends don’t change, the number of sausage consumers will increase in a couple of years.

According to the forecasts on the sausage market, this sector will see a steady growth in the next 3 years. The expected dynamics are presented exponentially. The main consumers, however, will be the large retail chains able to maintain big supply volumes without significantly changing the prices.

Source: www.peterburg.meatinfo.ru