The consumption of cheese and cheese products in 2020 compared to 2019 was driven up by the expansion of the footprint of chains and active demand-boosting promotional events, as well as a change in consumer preferences in favour of home-made consumption and partial refusal from public catering during the pandemic. This ramped up the production volume of this category of products, as well as that of butter, by 5% – up to 758 and 282 thousand tonnes, respectively. The combat of the Government against illegal trafficking of products from vegetable fats, as well as the decline in real household earnings, pushed up the demand for cheese products, while the growth in the production of semi-hard cheese slowed down.
The dairy products market in Russia is fragmented. Based on preliminary data for 2020, the top-5 cheese producers accounted for 22% of the market. Rusagro’s share in the Russian cheese market was 1.8%.
In 2020, the exports of margarines and spreads from Russia, including monolith margarines, grew by 10% to 234 thousand tonnes. Supplies of cheese and cheese products increased by 26% to 312 thousand tonnes, which included 50 thousand tonnes of cheese products (+26%). Export sales of Russian butter, whole milk powder and skim milk posted a considerable growth as to relative ratio (94% and 65%), but amounted to only 3 and 2 thousand tonnes, respectively. The development of exports of the product categories under consideration was boosted by higher competitiveness of Russian dairy products amid weakening rouble environment.
With the rising cost of milt production in 2020, the average annual price of raw milk increased by 4% and stood at RUB 25.9 per kg, excl. of VAT, which is a record high over the last five years.
The average annual producer prices for finished dairy products remained above the last year figures across all categories under analysis, other than cheese product category. Thus, with higher prices for milk, prices for cheese and butter rose by 8% – up to RUB 335 per kg exclusive of VAT. Prices for margarines and spreads, including monolith margarines, showed a little more advance – by 9%, due to higher market prices for palm oil.