Russia: Beer market still has 15-20% growth potential

Russian beer market still has 15-20% growth potential, Anton Artemiev, president of OOO “Baltika” Brewing Company, said at a press conference on April 6, according to Russian Beer Union, April 9.

Therefore, brewing companies continue to increase production potential and undertake new projects. “Baltika” plans to increase the production of its brewery in Samara by this summer and to build a brewery in Novosibirsk with a capacity of 2 mil tonnes, by summer 2008.

According to Artemiev, beer production will grow 3-5% this year. At the same time he accentuates that this is only a provisional prognosis. “We have a unique warm start of the year, the market is growing faster than we expected and yet not all the factors influencing the prognosis are taken into consideration”, he added.

In 2006 Russia produced 99.82 hl of beer, 9.8% more than in 2005.

According to Beer Union, the beer consumption constitutes 67 liters per capita which places Russia on 30th place in the world. The Europe average is 80 liters per capita.

“Brewing industry transferred to state budget 87.8 bln rubles in taxes, including 19.1 bln rubles in excise duties”, Artemiev said. Referring to excise duty policy, he proposed to index the beer excise duty according to inflation in the industry and not to that of entire economy. Last year, the prices grew 6%, this year the increase could reach 5%.

This proposal was supported by the Director of Federal Antimonopoly Service, Igor Artemiev. “This practice should be applied in the entire economy”, he said.

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