E-Malt.com News article: 3515

Russia: Baltika, the top Russian brewer, plans to add Iraq and Cuba to its export map next year as it continues to attract new overseas fans. "There are quite a lot of people who like to taste new brands," Baltika Director for Exports Dmitry Kistev said in a telephone interview late on Thursday, October 21, according to Reuters. "They are attracted by the unusual link of 'beer and Russia'," Kistev said of Baltika's typical customer.

The St Petersburg-based company, jointly owned by Carslberg and Scottish & Newcastle, plans to raise its export volumes to 180 million litres next year from just 41 million litres in 2001 when it began shipping abroad. "Initially, exports were just the acknowledgment of the quality of our beer," Kistev said. "But when Russian market growth started to slow in 2001, we had to look for new markets."

In 2001, export volumes accounted for 1 percent of Baltika's overall sales, but the company hopes to raise that to 6.5 percent this year and 9 percent in 2005. The ultimate goal is to export 15-18 % of production, Kistev said.

Russia's biggest beer exporter, which has recently started deliveries to New Zealand, sells the amber liquid in 35 countries. It plans to enter markets in Brazil, Cuba, India and Iraq next year. "We think that military operations will continue next year," he said of Iraq, adding that Baltika hoped mainly to supply coalition forces with its beer. "It will be Baltika No. 9, our strongest beer with 8 percent alcohol content. We already have orders, maybe deliveries will start even this year." Baltika will also sell Baltika No.0, its alcohol-free beer, for the local Iraqi population.

The United States -- Baltika's biggest market -- should consume 1.5 million litres this year and double that next year. "China should show a similar result next year," Kistev said. Brazil will drink 360,000 litres of Baltika beer in 2005.

The only market where Baltika faces major problems is ex-Soviet Georgia, whose authorities jailed the head of Baltika's local distributor for 3 months on accusations that the company had not paid excise charges. Baltika denies this. "We have been forced to stop sales to Georgia," Kistev said. Baltika used to deliver beer to Armenia via Georgia, but will now have to consider transportation through Iran, where Baltika also sells alcohol-free beer.

Baltika also plans to launch production outside Russia, primarily in the CIS countries. "There are such plans and we are holding talks," he said without elaborating.


24 October, 2004