Russian alcohol production increased in 2024

By Rhod Mackenzie

In 2024 Russia produced record levels of alcohol including wine,beer and spririts although alcohol consumption and exports rose. Rhod Mackenzie looks at the sector and what is behind the increase in the volume of production.

In 2024, Russia set a new record for alcohol production, with a volume of 10.1 billion liters — an increase of 9.5% compared to the previous year. The most notable growth was seen in wine, with a 14% increase. According to data from the Federal Service for Alcohol, Tabacco and Control (Rosalkogoltobakkontrol), beer and strong alcohol were in second and third place.
At the same time, alcohol sales per capita also grewb but at an albeit a more modest rate, as noted by analysts from the Ministry of Health. So what are the most popular drinks in Russia today and the factors driving the significant growth in alcohol production.

So what are the factors contributing to the significant increase in alcohol production in Russia.
In 2024, production volumes of all alcoholic beverages increased by 9.5% compared to 2023, reaching a record high of 10.1 billion litres over the eight-year period. For instance, in 2017, manufacturers produced 9.54 billion litres.

The wine sector demonstrated notable growth in recent market trends. Production in this sector increased by 14%, with still wines showing an 8.6% growth, and sparkling wines recording an impressive 24.7% increase. Liqueurs made from graped like brandies also experienced a substantial expansion, with a nearly 30% growth. The draft final report of Rosalkogoltobakkontrol (RATK) contains the relevant data, 
Second in terms of positive dynamics are fermented drinks, including beer, cider and mead, which saw a 12% increase. The next category is strong alcohol, including vodka, brandy, gin whisky, rum and other similar products. Yes I can attest the at Russia produces a wide range f excellent gins which I enjoy myself
Th Production volumes of these spritss increased by 8%. Notably, according to the results of last year,the production of "weak alcohol" (e.g. alcoholic cocktails) decreased by more than half (-56%), which is attributable to a threefold increase in excise tax on them from May 1, 2024.

The RATC document states that there is a correlation between the growth in alcohol production and the increase in its legal retail sales.

"The positive dynamics are influenced by several factors at once: the import substitution process continues. The falling volumes of foreign alcohol are being replaced by domestically produced products. Plus, the domestic tourism market is undergoing active development, with an increase in sales of alcoholic beverages during holiday and vacation periods, according to the service's observations outlined in the draft report.
Also, it should be noted that the population of the Russian Federation has increased as a result of the incorporation of new regions into the country, thereby impacting market dynamics.
RATK announced that production and retail sales volumes are increasing, plus  a decrease in the market share of illegal products.

Market research has indicated a growing interest in Russian wines, with a positive dynamics of shelf sales being a key indicator of this. Arsen Karapetyan, CEO of the Moe Vino company, has stated that there has been an increase in sales of domestic bottled wines by 13%. For instance, Inkerman, Massandra and Novy Svet wines demonstrated collective growth above market expectations. In 2024, bottled sales surged by 25% compared to the previous year.
The dynamics in sales and production of Russian wine in 2024 are due to several factors. An increase in excise taxes, coupled with higher duties on wines from non-friendly countries like France Italy and Portugal, has led to heightened consumer interest in domestic wine.
Furthermore, the analyst added that the marketing strategy have included campaigns and wine fairs for a wide range of consumers in million-plus population cities across the Russian Federation, as well as specialised events for market professionals and others.

He emphasised that the law "On Viticulture and Winemaking in the Russian Federation" has become a key factor in the development of the domestic wine industry. One of the key provisions of the document is the introduction of the definition of "Russian wine".
The policy restricted the use of imported wine materials, thereby encouraging the development of domestic vineyards and the growth of the share of domestic raw materials in production. Furthermore, the law established new regulations for winemaking and labelling, leading to Russian wine being recognised as a product of defined origin and quality. This led to a favourable perception of some drinks.
According to the Ministry of Agriculture, viticulture and winemaking in our country have become one of the most actively developing branches of agriculture in recent years. It was noted that the area of vineyards is increasing on an annual basis, and that the culture of winemaking and the quality of Russian wine are improving. The department anticipates an increase in wine production this year.
The Ministry of Agriculture has reported that consumers are increasingly opting for Russian wine in stores and restaurants.
At present, Russian wine accounts for approximately 60% of the total volume of wine sales. Please be advised that the grape harvest and, consequently, the volume of wine production are contingent on favourable weather conditions. In the initial four months of this year, the Russian Federation produced 169 million liters of wine, marking a 4.9% increase compared to the same period in 2024. The production of both still and sparkling wines is increasing.
From January to April, the total production of still wines and sparkling wines in the country was 116 million litres and 48 million litres, respectively. This represents an increase of 5.2% and 6.9% compared to the same period last year.

The Ministry has specified that there is an annual increase in grape production in the Russian Federation. In 2024, the harvest amounted to 908 thousand tons, which represents a record value in modern Russia. For comparison, in 2023, the figure was 882 thousand tons, according to the Ministry of Agriculture. The area of vineyards totalled 110,200 hectares, of which 86,400 hectares are in the production stage.
Last year, producers planted almost 7.5 thousand hectares of new vineyards, with the largest increase recorded in Crimea and Krasnodar Krai. The most popular varieties are Cabernet Sauvignon, Chardonnay and Pinot Noir. The department also recalled that this industry in the Russian Federation is actively supported by the state within the framework of the federal project "Stimulating the Development of Viticulture and Winemaking". The objective of this project is to significantly increase the area of vineyards in the fruit-bearing age.

Alexander Stavtsev, head of the WineRetail information centre, explained that demand for domestic wines in Russia has grown significantly. Last year, the entire volume of products produced was sold, with sales even exceeding the volume provided by the manufacturers. As a result, carryovers were necessary. He confirmed that all the wine produced was immediately allocated to store shelves. It is evident that the proportion of imported beverages in sales has diminished.
In the still wine sector, domestic products accounted for approximately 68%, which is 10 percentage points higher than the 2023 figure. In the sparkling wine sector, there was an 8 percentage point reduction in foreign supplies, resulting in a 70% share. The analyst explained that such significant changes are not accidental. The objective is to remove all foreign beverages from the category up to 800 rubles.  ( around $10 )
The authorities have been increasing import duties on wines from unfriendly countries. First, duties were revised on 1 August 2023, increasing from 20% to 20%. Then, on 10 August 2024, duties were increased again, from 25% to 25%. From 1 May 2025, the excise tax on wines will also increase threefold.

Furthermore, domestic producers who make drinks from Russian grapes will be able to recoup their expenses on harvesting. Alexander Stavtsev has stated that trade has increased its demand for Russian drinks, which has led to a significant increase in production.
As reported by Viktor Zykov, deputy head of the Department for the Prevention of Risk Factors and Communication Technologies in Healthcare at the Central Research Institute of Occupational Health of the Ministry of Health, in an interview with Izvestia, the Ministry of Health has confirmed a slight decrease in alcohol consumption per capita in terms of ethanol. The figures show a decrease from 8.49 liters in 2023 to 8.38 liters in 2024.

During this period, the number of people suffering from alcoholism decreased by 3.6%, and the incidence of alcohol addiction and alcohol psychosis decreased by 3.5%. According to industry experts, the recent surge in retail sales of alcoholic beverages can be attributed to the legalisation of the market, which included the implementation of the Honest Label system for beer, beer drinks, cider, perry and mead from the end of 2023.
This view is shared by producers of strong alcohol and beer products. For instance, Igor Kosarev, the president of the Union of Alcohol Producers, stated that, as of 1 January 2025, the excise tax on vodka in Russia had undergone a substantial increase, rising from 643 rubles to 740 rubles.
In anticipation of the measure, manufacturers increased production in November and December 2024. This has a significant impact on the production records of both last year and this year. Media reports indicated a 26% reduction from January to April.

In Q1 of 2025, vodka sales decreased by 7.8%, indicating a shift in sales from legal to illegal markets. This is facilitated by the efforts of some governors who restrict the legal sale of alcohol in their territories. Consequently, the turnover of illegal sales is increasing. In terms of actual consumption, there is a clear trend towards a more moderate lifestyle, although this shift is not happening at the rate that had been anticipated, as the expert explained.

Vyacheslav Mamontov, executive director of the Association of Beer, Malt and Beverage Producers, has stated that positive dynamics in fermented beverages is the result of the market whitening. Specifically, this is the balanced excise policy of previous years, as well as the introduction of a register of beer producers and product labelling, he added.
However, the dynamics of the brewing market may be subject to a slowdown due to an unexpected increase in excise taxes this year to 30 rubles from 27 rubles in 2024, as per the nalysts warning. The increase in rates is likely to have a negative effect on production volumes, result in an increase in the cost of products on the shelf and drive growth in the shadow market. It is anticipated that, in light of the prevailing key rate and the exchange rate's growth, producers will be compelled to undertake a review of their investment plans and consider a reduction in those plans.