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News and analysis on the global poultry
and animal feed industries.
on October 22, 2008

Russian meat consumption could decline 10%‚ say analysts

The global financial crisis, which has led to a reduction in the purchasing power of average Russians, could also lead to a 10% reduction in meat consumption by the end of 2008 compared with the first half of the year, reported Interfax News, citing...

The crisis would contribute to a reduction in the number of expensive products on the market and increase demand for more cost-efficient meat, said the report.

"According to rough estimates, the consumption of meat and meat products could fall by 10% compared to the first half of the year," Agrarian Marketing Institute General Director Yelena Tyurina told Interfax. The consumption of beef, the most expensive type of meat on the Russian market, could see the biggest decline, while poultry meat consumption could increase, she said.

Russian Meat Union President Musheg Mamikonian said sales channels for meat products could also change as consumers become more conscious of their spending. “Now, some consumers won't be going to expensive stores but to stores that get products directly from the company so as to avoid large markups, or they'll go to the market," he said.

Mamikonian also predicted there will be increased consumption of average- and low-price products in place of more expensive options.

"Producers have already reacted to these forecasts," Tyurina said. "Our regular monitoring has confirmed that many companies are aiming to increase the production of cheaper products and cut production of delicatessens," she said. “Producers will essentially return to the products they were producing two years ago,” she added.

The changes in consumer preference will affect middle-class and upper-middle-class families to a large degree, she said. "They will have to switch to cheaper products, while not much will change for families with lower incomes, since they couldn't afford delicatessens before," she said.
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