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Russian citrus market growing

The Conference "Citrus Market in Russia" organized with the information support of the FruitNews Information Agency took place in Moscow. It was attended by both Russian and foreign representatives. In her Conference opening speech Irina Koziy, General Director of RK Marketing Co. brought up a wide range of topics for discussion, from imports and logistics to retail sales.

“The citrus market is growing in Russia, it is still not formed completely. According to customer preference studies, citrus fruit category is the second most important. Its popularity among consumers is between bananas and apples. It’s also the traditional festive fruit, oranges and mandarins are the Russian seasonal fruits, much like the apple is in North America,” said Irina Koziy.

Anton Kruger, CEO of the Fresh Produce Exporters' Forum (FPEF), South Africa, noted the perspectives the Russian market holds for African suppliers. Not everyone gets the chance to supply fruit to Russia, as the standards are high and very strict. Besides, the marketing conditions are still somewhat unclear.

“Merely understanding the structure of the Russian fruit market is not enough to determine what kind of fruit are the most in demand. It is essential to establishing close business relations between exporters and importers,” Kruger pointed out.
Salvo Laudani, Marketing Manager of ORANFRIZER, Italy, suggested that all conference attendees should try the company’s blood orange juice during the coffee break. In his speech Salvo Laudani noted the favorable climate and fertile soil of Sicily, which allows the local farmers to grow great citrus fruit. Italian manufacturers enjoy the guaranteed best conditions for growing and harvesting blood oranges from December to May. Laudani emphasized the wholesomeness of Italian citruses.

Bas Hilferink, Director of Sales, Marketing and Innovation of International Paper, Morocco, made an interesting report on manufacturing modern packaging for the citrus market. He paid special attention to cost reduction and ways of increasing production quantity.

The expert on logistics - Ignat Ananyin, Executive Director of M-Ekspeditsia, LLC, Optifood Group of Companies pointed out the importance of accurate paperwork for the citrus import to the Russian market. Even a small mistake can lead to a significant delay in the customs clearance. Product handling and storage is also an important issue.

“One of the problems is that there is a lack of warehouses in Russia. This became an even bigger obstacle after the crisis,” noted Ananyin.

After a break, when the participants enjoyed the juice of Sicilian blood oranges, Natalia Antohina, Purchasing Director of the Federal Purchasing Alliance JSC “System "Т3С", took the floor. She spoke about the principles of organizing purchases in Russian retail chains and their scheme of work with suppliers. “Price, caliber and taste. That’s what matters most! Of these three, taste is the most important one. Price is essential in attracting customers, so the choice of supplying country is based on the prices. You can’t increase sales if your prices are high,” remarked Antohina.

Dmitry Ger, Manager of the Retail Division of Nevskaya Co., told about the suppliers the company works with, about the requirements of retail chains regarding fruit and their choice criteria. The company specializes in supplying fruits and vegetables. Its total turnover has increased by 30% in the last year. Citruses make up a quarter of the company’s sales. The demand for lemons and grapefruits is highest early in spring, while mandarins and oranges are bought most often late in fall. Nevskaya’s suppliers are mainly from South Africa, Morocco and Egypt. Large companies tend to be more reliable and provide higher quality products, so Nevskaya only works with them. Every retailer has specific demands concerning packaging and delivery. The price changes constantly depending on the current market situation.

Mischa Fok, European coordinator of the Chilean Fresh Fruit Association, shared some methods of marketing support used in supplier-buyer relations and ways of promotional support on the international market. In the year 2012 the Chilean Fresh Fruit Association organized a successful promotion campaign in Great Britain. Early this year a similar project in Russia increased sales of the product being promoted by 64%. Such campaigns help maintain the Russian retailers’ interest in goods from Chile.

Oleg Ivanov, Director of the BIGSUR Company, spoke about the level of market awareness and the uncertain picture of the final levels of consumption. “The problem is that the Russian market has no infrastructure aimed at attracting customers,” said the Russian expert. Oleg Ivanov noted that in Russia regional retail companies reached national level relatively recently – no earlier than in 2005. However, detailed sales statistics for different products is available today. The problem of low awareness still remains acute: much of the information doesn’t reach the end-buyer. For example, the type of product is marked on the label, but the country of origin isn’t. Retailers should realize the importance of providing customers with maximum information so that they can make a rational choice of this or that specific product. That’s up to promotion campaigns.

As the final accord of this citrus-rich event it was decided to make the Conference “Citrus Market in Russia” an annual event. “I’m very happy that the Conference audience turned out to be so remarkable. Half the attendees represented foreign suppliers of citrus fruit to the Russian market and the other half were from domestic companies selling citrus within the Russian Federation,” mentioned Irina Koziy. “I believe the increasing significance of the subject will insure the next year’s conference, where we’ll again have the opportunity to discuss many important topics.”

For more information:
FruitNews Information Agency
Tel: +7 (495) 729-3080
Fax: +7 (495) 989-2670

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