USMEF Strategic Market Profile

Russia

Market Trends and Growth Potential

• Despite the increase in per capita pork consumption in Russia over the past few years, it is still only 70% percent of the record Soviet level in 1990.
• The retail sector is showing tremendous growth.
• Consumption of chilled pork has grown rapidly.
• Branded cuts are more heavily promoted.
• Pork variety meat consumption has grown due to a favorable quota regime and competitive prices.

• Local pork production is expensive and inefficient and leaves room for imports, though the Russian government offers strong support to domestic production.
• U.S. pork is recognized for its consistent quality and reliable supply.
• Branded U.S. pork retail items are becoming more competitive because of price and added value.
• U.S. suppliers are extremely competitive in pork variety meats.
• Smuggling from Ukraine, Moldova and China may generate unfair competition when equivalent veterinary controls are not applied.

Market Penetration

• U.S. penetration into the processing sector remains high.
• U.S. pork benefits from full access to the retail sector.
• U.S. pork value-added cuts have expanded into the HRI sectors in Moscow, St. Petersburg and Vladivostok. Frozen U.S. pork is also showing regional HRI expansion.
• Consumption of retail goods is increasing. U.S. pork’s consistency, packaging and variety is a very positive factor for expansion in this sector.

Product/Industry Image

• U.S. pork enjoys a reputation for being a high quality and consistent product that is readily available.
• The public perceives the product as safe.
• U.S. pork benefits from strong brand identification.
• U.S. business practices are considered transparent.

Operating/Marketing Environment and Trade/Distribution Issues

• Shelf life for chilled pork is restricted.
• Port capacity is limited.
• The quota system lacks transparency and predictability.
• There is a strict veterinary regime that is unyielding.

Access Conditions

• U.S. pork products are considered safe by the Russian Veterinary Services.
• Retail certificates are available for all U.S. pork and variety meat products.
• USDA offers prompt approval of U.S. pork plants for shipments to Russia. USDA is authorized to conduct inspections on behalf of Russian Rosselkoznadzor.
• FAS/Moscow and FAS/Washington are prompt in resolving access issues.

Import and market share data is based on import data of Russia (from GTA), and U.S. export data is from the U.S. Department of Commerce, Trade Census Bureau.

Long-term Strategy:

• Identify new metropolitan areas and key accounts to target beyond Moscow, St. Petersburg and Vladivostok.
• Develop high-quality, high-end markets across the sectors.  Major cuts to be promoted include middle cuts and enhanced product for growing upscale HRI and retail sectors, and leg and shoulder parts for further processing and standard retail outlets.
• Maintain loyalty and continue building demand for U.S. pork in the processing sector in Russia.

USMEF Export Forecasts: