Alcohol consumption spikes in Russia

Russia’s alcohol consumption has reached alarming highs, with almost 2 billion litres of alcohol sold in the Russian retail trade in the first 10 months of 2024.

Vodka demonstrated record sales in 2024 with 625 million litres sold, breaking the 2017 high of 542 million litres.

Record sales were also observed for still and sparkling wines. Still wine sales amounted to 469m litres, 0.9% more than last year. Sales of sparkling wines increased to 163m litres over the same period. This equates to a 10.9% year-on-year rise for the same period.

Parallel imports of wine have surged in Russia as a means to bypass Western sanctions, allowing consumers continued access to popular European brands.

The wine sanctions affecting Russia were imposed by Western nations in response to the Ukraine conflict. These sanctions aim to restrict trade and reduce revenue streams. Russia responded in 2023 by increasing import duties on wine from unfriendly countries, from 12.5% to 20%, making parallel imports a key strategy to maintain access to foreign wine markets.

Wines from countries like France and Italy, which faced the higher import duties for unfriendly nations, are now entering the market through alternative supply chains. These parallel imports enable distributors to sidestep restrictions by re-routing products through intermediary countries, keeping shelves stocked with international wines at competitive prices. While this has made high-quality imported wine more affordable for Russian consumers, it undermines the effectiveness of sanctions and raises concerns about the regulation and authenticity of products in the market.