Adult life of baby food
The domestic market of baby food has a huge potential that needs to be developed, belive industry experts. Head of the Department of the Research Institute of Baby food – a branch of Federal state budgetary institution of science «Federal research centre for nutrition and biotechnology» Elena Simonenko describes the range of domestic baby food on various raw materials as insufficient with the enormous capacity of the market.
- In terms of infant formula for young children, the market is dominated by products of foreign origin. There is a wish that the domestic production also received the development. It is necessary to work on import substitution and develop domestic production of breast milk substitutes, – said Simonenko.
The need to stimulate the production of baby food is also emphasized by the authorities: in April, the first Deputy Minister of agriculture Dzhambulat Khatuov held a meeting on the import substitution of raw materials for the production of baby food.
– One of the areas that still remains import-dependent is the production of raw materials for baby food. The state is ready to invest in the modernization and construction of new enterprises, as these products are necessary for the country, – said the first Deputy Minister.
Recently it became known that the Ministry of agriculture intends to allocate new areas of compensation CAPEX for the construction of enterprises producing infant formula. According to Deputy Director of the Department of food industry of the Ministry of agriculture of the Russian Federation Vladimir Skvortsov, the Department intends to compensate up to 20% of the direct costs incurred to create capacities for the production of powdered dairy products for baby food and components for them.
Baby food market in numbers
According to the marketing agency Discovery Research Group, in 2016 the total volume of baby food in Russia amounted to 595.28 thousand tons, which is 252.20 billion rubles in monetary terms. Similar indicators in terms of production of powdered cereals – 9310.4 tons which means 9120,2 million rubles. The main production of powdered cereals for children in Russia is in Vologda oblast, where in 2016 they produced 2816.4 tons of products.
The leading brand for the supply of infant formula to Russia at the end of 2016 became NESTOGEN. The volume of import under this brand amounted to 13164.7 million rubles, which is equivalent to 10481.8 tons. In 2016 most of infant formula from Russia were exported by NUTRILAC - the volume of export amounted to 1115.0 tons or 1453.1 million rubles in monetary terms.
According to retail audit Nielsen, the decline in sales on the baby food market has been replaced by a rise: there is observed the sales growth in real terms by 1.3% from July 2016 to June 2017. At the same time, the growth rate of sales in monetary terms slowed down: in July 2016-June 2017 – by 5.3%, a year earlier – by 9.7%. The reason for this was a noticeable slowdown in prices per unit: from 11.5% to 2.3%.
If you believe Euromonitor International, the brand "Frutonyanya" of JSC "Progress" has become the leader on the market of baby food in Russia in 2016 with a share of 16.1% in monetary terms. It is followed by Danone - brands "Tema" and "Rastishka" occupy 13.8% of the market. Nestle with its products Nan, Nestogen and Gerber ranks the third among the leaders, their share corresponds to 9.9% of the market. At the same time, the company is the leader in terms of export of powdered cereals for babies from Russia – in 2016 the figure was 1108.0 million rubles, which is equivalent to 881.7 tons of products.
The largest category in terms of sales in monetary terms is viscous baby food (puree, ready meals) with a share of 24.5%, the share of the category in real terms is 12.3%.
- At the moment, Russia has created an attractive economic climate for operation in the field of milk production and processing. I assume that the production of baby food in the country will grow: the industry is interesting, payback, technological. I believe that we can reach the export of Russian baby food, – commented in an interview with The DairyNews Director of the Association of industrial goat breeding, Head of LLC "Lukoz Saba" Taras Kozhanov.
Market analysts predict trends towards the overall stabilization of the market and they hope that this will create a favorable background for the development of domestic production of baby food. According to the forecasts of “Rusprodsoyuz”, the growth of the birth rate and low rates of price growth can become drivers for increasing the production of baby food.
Цитаты дня
