The diplomat Alexander I Kuznetsov has visited FENAVIN and participated in a conference in which the keys to all the options and facets involved in exporting Spanish wine to the Russian market have been put forward for the participating wineries and exhibitors.
Coinciding with the dual year Spain-Russia, Russia-Spain, the National Trade Fair on Wine (FENAVIN), which is taking place in Ciudad Real from May 10th to the 12th, has hosted a conference with the very best experts and specialists that has dealt with the behavior of Spanish wine in Russia, with participation of the Ambassador of the Russian Federation in Spain, Alexander I Kuznetsov, to be highlighted, who underlined the growing presence of Spanish wine in his country, stressing the importance of the middle class market.
In this sense the informative forum 'Presence of Spanish Wine in Russia', which has taken place this morning, has offered the wineries and exhibitors present at the trade fair all the keys to the options and facets involved in exporting Spanish wine to the Russian market. Apart from the Russian diplomat, other speakers also participated, among them Alesia Slizhava, expert in the Russian wine market, along with José Manuel Pérez Pascuas, winery owner and Javier Gila, sommelier at Lavinia. The forum was coordinated by the historian and journalist Jesús Palacios.
Diplomat with a brilliant career, Doctor in Historical Sciences and great connoisseur of Spanish wines, Ambassador Kuznetsov predicted great perspectives for Spanish wine in his country. This as long as an effort in promotion is made and if we cater to the middle classes, offering wine that is good quality for money, which is something that cannot be currently found in the Russian Federation.
531 million liters of wine in 2010
In as far as figures are concerned, Russia imported 531 million liters of wine from around the world in the year 2010. Presence of the Spanish product increased in more than forty percent, representing the third market in that pertaining to quantity and seventh in added value. Kuznetsov explained that this difference is due to the fact that almost half of Spanish wine imported by Russia is bulk wine, although imports of bottled wine and sparkling wine are on the increase. The diplomat pointed out that wine is a new product for the Russian citizen, although culture for the same is rapidly evolving, which means that this market is turning into a dynamic one, "in which the wine trade between Russia and Spain has great perspectives."
The Russian Ambassador also explained that his country's market is very competitive and that all wine producing countries do indeed want to find their niche there, with the large supermarkets representing the best indicator of the position of wines in the world. In the case of Spanish wines, Kuznetsov underlines that there is a contradiction, as on the one hand there is much bulk wine "but it is an anonymous wine, and the Spain brand is not very present", while on the other hand we do find better-known first-rate labels such as Rioja, Ribera del Duero or Priorato.
However, in the opinion of the Russian diplomat, "there is a lack of Spanish wine with a good quality-price ratio for the middle classes, as it is impossible to find this product on the store shelves." Currently, the more affordable wines, those that prevail on the market, are wines from Chile, Argentina, and other countries.
Promising future for the wines of Castilla-La Mancha
In relationship with the Castilla-La Mancha wine producing area, Ambassador Kuznetsov assures us that this region does indeed have a great and promising future before it as an exporter of wine to Russia, "for the simple reason that the wineries are undergoing an impressive technological overhaul, with bottled wines of great quality in provinces such as Ciudad Real and Toledo." "I believe, he added, that this is precisely the wine that can compete with Chilean wines, for example, which also have an excellent quality-price ratio." He insists that a more coherent, intelligent, insistent, and aggressive commercial strategy is needed in order to "occupy a position on the Russian market, because you have all it takes to really be an important presence on the market."
Finally, the Ambassador declared that he is a rather moderate consumer of wine, although he particularly appreciates wine's role as an instrument that promotes friendships, human relations, and culture. He acknowledges that he has many friends who are winery owners in Castilla-La Mancha and Castilla y León, where he has recently been appointed Honorary Member (by Valdepeñas and Ribera del Duero). He also points out that visiting FENAVIN is a pleasure, "I have visited wineries in Castilla-La Mancha on several occasions, and I can indeed appreciate the quality of the wine."
Jesús Palacios, coordinator of the round table, considers that the evolution experienced by Spanish wine in Russia is on the rise, although very unevenly. According to his point of view, the perspectives on the Russian market are far more interesting on the medium term than those in other emerging countries such as China, Japan, or Australia. Notwithstanding, he recognizes that until Spanish wine finds its niche in the top spots, as is the case with Spanish olives and virgin olive oil, "we will have to work really hard and overcome the obstacles and hurdles of the red tape involved with the complicated Russian customs barriers. Thus above all, we will have to wager on and support quality so that Spanish wines can become a growing and well-defined steadfast reference for the Russian consumer."
Consumption per capita, 5 to 7 liters
Average consumption of wine stands at about 5 to 7 liters per person and year "although this tendency is gradually changing", he assures. In big cities like Moscow or Saint Petersburg, the wine maker explains, mass consumption of wine is orientated at cheap table wine that costs less than three Euros a bottle, although there is a sector of the population with tremendous purchasing power that consumes expensive and very expensive wines without really paying much attention to price, apart from an emerging middle class that consumes medium and high-end wines on a regular basis.
With regards to products from La Mancha, Palacios values initiatives such as those undertaken by 'Vinos de la España del Quijote', "as they represent an excellent letter of presentation, although initiatives such as these should be associated to good quality and excellence." Likewise, from his point of view, the Spain brand in wines should be implemented in Russia by way of marketing campaigns that must be backed-up by the Administration.
"We must promote medium-high and high-end segment wines"
During her speech, the Doctor in Political Sciences Alesia Slizhava, specialist in the introduction of Spanish wines in Russia, pointed out the difficulties and barriers that Spanish wines encounter in Russia.
More than eighty Spanish wineries are currently working with Russia and the wines that are well known and appreciated the most are Rioja, Ribera del Duero, Priorato, Navarra, Jerez and Penedés, although wines from more than thirty regions are actually represented. In the opinion of the expert, "it is quite obvious that other Denominations of Origin must be made known and the medium-high/high-end segment Spanish wines still have to be introduced, "as Russian citizens love new things, fashionable things; apart from the fact that the purchasing power of Russia's middle class is improving."
Among the problems that should be resolved, Slizhava mentioned the "bad image" that Spanish wine has acquired because of some of the cheap, low quality wines that have been exported to cover an important part of the demand. Thus "a good part of these exports are in the shape of bulk wine that is then bottled in Russia and sold as 'Spanish wine', making different blends that in the long term are actually detrimental to the image of Spanish wine."
The Belarus born expert considers that it is very important to promote good marketing actions for Spanish wine and permanent establishments of Spanish companies should also be insured, "as it would be interesting to have some sort of gastronomical support, linking it with cheese, ham or olive oil."
On his part the Spanish sommelier Javier Gila covered the wine tastes of the Russian citizens, "who prefer powerful, structured wines from well-known areas… in short, they like top wines, exclusive wines." As Sommelier at the Ritz Hotel and for Lavinia, he described the type of consumption made by Russian clients in these well-known spots.
Gila also stressed the importance of paying attention to the middle class market that is emerging in Russia, as "we have excellent wines that can be enjoyed with the middle classes, because a change in trends has actually taken place on this market in which twenty years ago Russians were only drinking vodka and now they are already asking for wine. There is also more knowledge of this product now, because until quite recently they were identifying quality with price."
The impresario José Manuel Pérez Pascuas also participated in the conference at FENAVIN, offering an interesting point of view as an exporter of wines from his wineries in the Ribera del Duero (Hermanos Pérez Pascuas) to the Russian market. Pérez Pascuas has pointed out that in these fifteen years of experience he has been both "pleased and surprised" with the sales made to the high-end segment of the population: private clients, specialized stores and top-end restaurants, "as we never even imagined the results we have obtained," he underlined. Unlike other countries, the winery owner explained, in Russia we have sold expensive wines at high prices.
Pérez Pascuas points out that 20,000 bottles of wine are distributed in Russia, this from a total volume of 550,000 or 600,000 bottles produced in the winery, "a representative percentage that is on the increase despite the crisis, because those that have money in Russia, have a lot of money." The Castilian impresario considers that importers and distributors need support and "affection" from the wineries, which means that it is also convenient and recommendable that the wineries become directly involved in the country by hosting tasting sessions, presentations, etc.
From the more than thirty-five countries in which this Castilian winery is present, the Russian Federation stands among the best three or five. The winery was founded in 1980 and some of the brands it commercializes are 'Viña Pedrosa' and 'Pérez Pascuas', apart from 'Cepa Gavilán' and 'Finca la Navilla'.
In José Manuel Pérez's opinion, "we should not just settle for the elite segment in a market with this level of competition. We must work hard in order to reach the level of countries such as France and Italy."