The Russian coffee market is on the peak of its development

08 Sep 2009 • by Natalie Aster

Since 2009 in Russia the mid-annual increase of retail coffee trade turnover is expected approximately at 4-5% in value terms. Experts of «Information Agency «CredInform North-West» reached such conclusion having made marketing research: The Russian coffee market: state and development trends. In 2008 reduction of natural coffee output (32573 tons) occurred due to import decrease of raw materials that reached 3716 thousand bags in the same period.

World coffee consumption can exceed its output approximately at 8 million bags due to decrease in coffee crop in Brazil during 2009-2010. Next year coffee harvest can be reduced 12%. At the same time throughout last years experts note steady reduction of coffee stocks. So, according to preliminary information the world reserves level on 2008/2009 crop is estimated in 17 million bags.

The Russian coffee market shows annual stable growth. The indicators increase in kind makes approximately 5%, in value terms – about 20%.

However according to experts estimations growth rates will further decrease. During the pre-crisis period market capacity growth was promoted by increase in demand from consumers with income average level.

The Russian coffee market is characterized with high import-dependence providing consumer demand for all kinds of coffee products in local market. In 2008 the greatest share of import deliveries was made from Vietnam as in kind as in value terms.

The world coffee demand in spite of economic crisis is kept on enough high level which is estimated by experts in 128.5 million bags. Also in the world the coffee consumption level grows basically at the expense of exporting countries, in particular, Brazil. As to Russia coffee demand was reduced to 8.4% in general during 2008 and reached 3716 thousand bags in absolute terms.

In Russia under crisis conditions according to a pessimistic development scenario the market participants expect state support in the form of credit granting (6 billion rub) in order to purchase raw materials for the whole branch.

In 2009 the Russian coffee market in kind will grow at 5% in average at relative stability in the world coffee market.