openPR Logo
Press release

Russia's Imports Substitution Policy: What Are the Drawbacks?

09-30-2016 10:46 AM CET | Advertising, Media Consulting, Marketing Research

Press release from: IndexBox

According to marketing research firm IndexBox, in Russia "counter-sanctions" have resulted in higher prices and poorer quality consumer products.

Russia introduced a products ban against the USA, the EU and several other developed countries exactly two years ago this August. In the immediate aftermath of the ban coming into effect, experts warned, amongst other things, that it would lead to higher prices and a reduced availability of consumer goods.

This is exactly what happened. According to data published in a report last summer by the Analytical Centre for the Government of the Russian Federation, the share of bread, cereal and pasta products increased (from 22.2% to 23.1%), while the share of fruit and vegetables declined (from 20.6% to 16.8%), within the cost structure of the minimum food products range during 2015. At the end of last year, the share of these food items in the consumer goods basket stood at 38% - much higher than the typical levels for developed countries (15-20%) and for some developing countries, for example, Brazil (17.8%).

The quality of dairy products has become an acute issue under the terms of the ban. According to data from the Federal Service for Veterinary and Phytosanitary Surveillance, in October 2015, 50-78% of cheese in various regions across Russia was a counterfeit product - it was actually vegetable fat. The double-digit price increases were another problem: in 2015, the price of butter surged by 11%, milk powder by 20%, beef by 16%, frozen fish by 24% and apples by 14%. It should be mentioned here that prices were also increasing on those products that did not fall under the embargo: bread (by 13.2%), pasta products (by 19.5%), sunflower oil (by 37.2%) and granulated sugar (by 12.9%). Egg prices soared the most: they reached their lowest level in August (49 rubles for 10); by December, the cost had surged to 65 rubles, exceeding even February's record (64 rubles for 10).

A number of quality foreign goods automatically became unavailable to Russians as a result of the food ban. The imports slump across a whole range of product categories is also associated with this: in 2015, imports of fresh and chilled fish contracted by 66%, poultry by 44%, butter by 38%, cheese and cottage cheese by 37% and frozen beef by 37%. Imports of these products would have invariably contracted following the devaluation of the ruble; this curtailment would have been less significant, however, if the food ban had not been introduced.

Given this scenario, the impact of the price hike would not have been as harsh. Neighbouring Belarus is one example of this: in 2015, the rate of the national currency against the dollar plummeted by 56%. In December 2015, however, the price of beef in Belarus was 19% lower than in Russia; the price of pork - 15%, poultry - 11%, apples - 38%, and milk 24%. Nothing other than the negative effect of the food ban, which restricted competition on Russia's food products market, could account for this discrepancy.

Overall, the concerns of those experts who believed that the embargo would result in a price hike and poorer quality consumer products, were justified. IndexBox experts maintain that Russian experience has indicated once again that the consequence of foreign trade restrictions may be not simply the substitution of imports, but also a depleted status for the consumer.

IndexBox is a leading market research publisher in the world. We conduct market research and publish reports. You can find more than 25,000 research reports in our web store, which cover global industries and regional markets. All the worldwide marketing data you need is at your fingertips. We collect this data from hundreds of highly reliable sources, verify it and carry out market analysis, uncovering new business opportunities and empowering you with actionable insights.

Media Contact
Company Name: IndexBox
Contact Person: Kirill Bezverhi
Email: kirill.bezverhi@indexbox.co.uk
Phone: +44 20 3239 3063
Country: United Kingdom
Adress: 44 Main Street Douglas South Lanarkshire Scotland ML11 0QW
Website: www.indexbox.co.uk

This release was published on openPR.

Permanent link to this press release:

Copy
Please set a link in the press area of your homepage to this press release on openPR. openPR disclaims liability for any content contained in this release.

You can edit or delete your press release Russia's Imports Substitution Policy: What Are the Drawbacks? here

News-ID: 368559 • Views: 568

More Releases from IndexBox

Global Sweetened Dried Fruit And Nut 2018-2025 – Industry Report, Market Analy …
IndexBox, Inc. has just published a new report "World – Fruits, Nuts And Peel (Sugar Preserved) – Market Analysis, Forecast, Size, Trends and Insights". Here is a summary of the report’s key findings. Sweetened dried fruit and nut Imports In 2017, approx. 168K tonnes of fruits, nuts and peel (sugar preserved) were imported worldwide; ascending by 9% against the previous year level. The total import volume increased at an average annual rate
Global Grain Market - Industry Snapshots and Statistics 2018
IndexBox has just published a new report "World: Cereal Grains - Market Report. Analysis And Forecast To 2025" ( http://www.indexbox.co.uk/store/world-cereal-grains-market-report-analysis-and-forecast-to-2020?utm_source=opr ). This report contains an in-depth analysis of the global grains market. Within it, you will find the latest data on market trends and opportunities by country, consumption, production and price developments, as well as the global trade (imports and exports). The forecast exhibits the market perspectives through 2025. Countries coverage: Worldwide
Global Meat Market - Research on Economic Outlooks, Analysis and Forecasts to 2 …
IndexBox has just published a new report "World: Meat - Market Report. Analysis And Forecast To 2025" ( http://www.indexbox.co.uk/store/world-meat-market-report-analysis-and-forecast-to-2020?utm_source=opr ). This report covers an in-depth study of the global meat market. Within it, you will discover the latest data on market trends and opportunities by country, consumption, production and price developments, as well as the global trade (imports and exports). The outlook indicates the market perspectives through 2025. Countries coverage: Worldwide -
Global Mustard Seed Market - Industry Snapshots and Statistics 2018
IndexBox has just published a new report "World: Mustard Seed - Market Report. Analysis And Forecast To 2025" ( http://www.indexbox.co.uk/store/world-mustard-seed-market-report-analysis-and-forecast-to-2020?utm_source=opr ). This report covers a detailed survey of the global mustard seed market. Within it, you will identify the latest data on market trends and opportunities by country, consumption, production and price developments, as well as the global trade (imports and exports). The outlook presents the market prospects through 2025. Countries coverage:

All 5 Releases


More Releases for Russia

Packaged Water in Russia
ReportsWorldwide has announced the addition of a new report title Packaged Water in Russia to its growing collection of premium market research reports. Packaged Water in Russia industry profile provides top-line qualitative and quantitative summary information including: market share, market size (value and volume 2011-15, and forecast to 2020). The profile also contains descriptions of the leading players including key financial metrics and analysis of competitive pressures within the market. Synopsis: Essential resource
Medium & Heavy Trucks in Russia
ReportsWorldwide has announced the addition of a new report title Medium & Heavy Trucks in Russia to its growing collection of premium market research reports. Medium & Heavy Trucks in Russia industry profile provides top-line qualitative and quantitative summary information including: market size (value and volume 2012-16, and forecast to 2021). The profile also contains descriptions of the leading players including key financial metrics and analysis of competitive pressures within the
Energy Drinks in Russia
ReportsWorldwide has announced the addition of a new report title Energy Drinks in Russia to its growing collection of premium market research reports. Energy Drinks in Russia industry profile provides top-line qualitative and quantitative summary information including: market share, market size (value and volume 2011-15, and forecast to 2020). The profile also contains descriptions of the leading players including key financial metrics and analysis of competitive pressures within the market. Synopsis: Essential resource
Consumer Electronics in Russia
Summary After the collapse of retail volume sales of consumer electronics in 2015, the negative trend continued in 2016. Although prices of oil were partly restored, business investments and the real income of Russians continued to decline, making a fast recovery of Russia’s economy questionable. As a result, consumers in Russia became very cautious when making their purchasing decisions. Despite the strong overall decline in retail volume sales, the performances of
Consumer Health in Russia
Summary Russian consumers are becoming more restrained in terms of spending money on consumer health products. The trend towards economising has become more widespread due to an economic slowdown in Russia and the consequent decrease in consumers’ disposable incomes. Russians are showing a greater preference for cheaper remedies or refusing to purchase any in the case of mild ailments that can be cured by traditional medicines. This is particularly so for
Russia Hotels – Best Hotels Available in Russia
Are you tired of searching for best hotels in Russia through search engines, now there is no need to waste your valuable time digging search engines, because we proudly announce besthotelsrussia.com here you get all details about hotels available in Russia. Russia is the largest country in the world this place covers almost the whole of Asia and 40% of Europe. It also has huge population ranking in ninth position