Russia’s economic crisis hurts meat sales

By Nick Holdsworth, in Moscow

- Last updated on GMT

Related tags: National meat association, Russia, Beef, Pork, Poultry

Despite the turmoil, turkey producers have benefited from Russia's economic crisis
Despite the turmoil, turkey producers have benefited from Russia's economic crisis
Meat producers are struggling in the midst of Russia’s economic crisis as hard-pressed consumers cut back on luxury beef and pork in favour of cheaper alternatives, like turkey. 

Overall meat consumption – including poultry – is forecast to drop 2.4% this year to 9.9 million tonnes compared with 10.2 million tonnes in 2015, figures from Russia’s National Meat Association (NMA) show.

Mushegh Mamikonyan, president of the meat industry council of the Russian-led Eurasian Economic Union (and the president of the Russian Meat Union), along with other meat industry experts, said meat consumption had fallen with the rise of Russia’s economic crisis, the devaluation of the Russian rouble and a sharp drop in imports, many of which were caused by the Russian government embargo on Western meat imports.

Beef purchases experienced the steepest decline, down by 10% across Russia during the year, he told Russian language business daily RBC.

Year-on-year fall

The trend has been backed by figures from Moscow’s World Trade Centre, which said lower incomes, rising prices and the import ban contributed to a year-on-year fall of 31.5% in the volume of imported meat and meat products in the first 10 months of 2015 to 921,000t. In dollar terms the decrease was even steeper – by value, imports fell 42.7% to US$2.5 billion.

Meanwhile, consumer prices for meat have climbed steeply – the first six months of 2015 saw the average price of meat cuts increase by 29% compared with 2014, with meat sales down by 5%, according to Russian market research agency Romir.

People simply don’t have the income now, so they save money on meat,​” said Sergei Yushin, executive director of Russia’s National Meat Association, another meat sector organisation in the country. Yushin emphasised that meat consumption in Russia remained high by international standards – currently around 70kg per person per year, a drop of 5kg compared with 2013. The comparative figure for some of the world’s richest countries – such as the USA and Canada – was around 82kg he added.

Turkey enjoys bumper year

Meanwhile, Russian turkey and duck farmers have been benefiting as rising meat prices have forced changes in shoppers’ habits. A decade ago, Russians ate 200 grams of turkey per person a year. Today that figure has grown to almost 2kg and production is increasing at a similar pace.

Indeed, turkey producers had a bumper year in 2015, with production up by a third year-on-year to 205,000t by carcase weight, compared with around 28,000t a decade ago, according to Vadim Vaneev, general director of Eurodon, one of Russia’s leading producers of turkey meat, and Global Reach Consulting.

Eight years ago, everyone was laughing; no one wanted to hear about turkey. Now all and sundry are involved in turkey. We rocked the market,​” said Vaneev.

Duck meat is also benefiting from the switch in consumers’ habits, with an increase of 12.7% to 124,000t last year, according to Russia’s Agriculture Ministry.

Most duck meat is produced by small firms and farmers, although Donstar, a southern Russian subsidiary of Eurodon, was responsible for 24,000t alone in 2015. Eurodon plans to consolidate production and form larger units.

Related topics: Meat

Related news

Show more

Follow us

Products

View more

Webinars