Cheers! Not really for Russian beer despite a surge in sales during World Cup
The surge in sales during the World Cup will not have a lasting impact on Russia’s beer industry, where consumption has been losing fizz for years
Moscow: Football fans from around the world are flocking to Russia’s bars, beer gardens and craft beer pubs to quench their thirst as the World Cup heats up.
But the surge in sales will not have a lasting impact on Russia’s beer industry, where consumption has been losing fizz for years—ever since it lost its classification as a soft drink.
Russia ranks 14th in terms of annual alcohol consumption per capita, according to the World Health Organization.
But with spirits traditionally playing a stronger role in social life, Russia ranks at 32nd in terms of beer consumption, according to a 2016 survey by Japanese beermaker Kirin.
Part of the reason why Russians are drinking less beer now than they were in the early 2000s is because of moves to restrict sales and advertising. Higher taxes on beer and declining consumer spending power have also contributed. The real turning point came in 2011, when beer was classified as an alcoholic drink rather than as a soft drink. Since then, nighttime sales have been banned, as have sales at street kiosks and in particularly large volumes.
Since 2013, with a major economic crisis in full swing, the market has contracted more than 24% and is set to lose another 11% by 2023, according to an estimate by Euromonitor.
“Between 2007 and 2017, tax on beer grew almost tenfold,” said Pavel Yerankevich, senior development director at Baltika, Russia’s number one beer brand, which now belongs to Denmark’s Carlsberg group. “All that together with the unfavourable macroeconomic situation has of course influenced the state of the market,” he added.
Budweiser, as the official sponsor of the World Cup, may be the only beer likely to see a strong benefit. Budweiser, made by AB Inbev, is the only beer allowed in stadiums and fan zones.
Alcoholic beverage sales are banned in a two-kilometre radius around the stadiums.
- Vinai Venkatesham new Arsenal MD after CEO Ivan Gazidis joins AC Milan
- Virat Kohli, weightlifter Mirabai Chanu recommended for Khel Ratna
- Sachin Tendulkar likely to sell off his stakes in Kerala Blasters
- With tobacco revenue now forbidden, F1 turns to high-tech
- The best travelling batsmen in the past 30 years
Editor's Picks »
- Pidilite’s shares hold their ground despite weak rupee and rising crude
- Automobile sector shares trip on rising risks to earnings growth
- Steel companies are taking a shine to their home market
- Investments in HDFC AMC shares are subject to regulatory risks
- Spot electricity prices: Seasonal spikes becoming structural issue