February 12 2003, 13:20

Russian pasta market decelerates its growth

Rates of growth in production in the Russian market of pasta are decreasing.

In the Russian market the share of high-quality pasta, produced of durum wheat (group A pasta), is 25 percent. Of this group, 80 percent of the pasta is produced by large domestic holdings, and the remainder of the high-class macaroni segment is mainly the premium class import, represented by renowned Italian brands.

The lion's share - around 75 percent - of Russian pasta market belongs to macaroni group B: lower quality items, produced from soft wheat by Russian factories only.

Specialists are forecasting that already in this year distribution of the groups A and B in the market will change. The share of the higher quality, and consequently - more expensive - group A will reach 50 percent. This will be fostered by expected change of market conjuncture.

It has been the second consecutive year that the rates of growth in the formerly dynamic pasta market have been decreasing, now constituting just 3 to 5 percent a year (in the late 1990's it was 25 to 30 percent). Further development of the market is being prevented by low demand: consumption of pasta in Russia is about 5 to 7 kilos per person per year, which is 10 times as little as in West Europe.

Much fiercer competition in expected in the market in nearest time. Weaker players will be ousted, while the quality of stronger players will increase.