Russian alcohol producers announce sharp price increases
Five major alcohol producers in Russia have informed retail chains that they will raise wholesale prices on their products starting January 1, 2026, which will lead to a 10–17% increase in alcohol prices.
According to The Moscow Times, companies are forced to adjust prices due to rising excise taxes, inflation, and higher borrowing costs.
Specifically: GC “Rust” reported an increase in production costs due to higher prices for bottles, labels, and sealing materials.Ladoga cited rising expenses for transportation, warehousing logistics, and energy. KVK Group noted that cognac distillates have become more expensive.
The Russian government has previously approved excise tax increases effective January 1, 2026:
For alcohol with 18% ABV or higher, excise will rise by 11.4% to 824 rubles per liter of anhydrous alcohol.
For alcohol under 18% ABV, excise will increase from 148 rubles to 165 rubles per liter.
At the same time, the value-added tax (VAT) will increase from 20% to 22%.
Additionally, minimum retail prices are expected to rise for vodka, brandy, similar spirits, and for cognac and whiskey made from raw materials aged at least three years. Some producers expect that the price hikes will reduce demand in the first quarter of 2026.
The article cites data from the Federal Service for Alcohol and Tobacco Market Regulation, showing that from January to November 2025, alcohol sales in Russia fell by 9.8% compared to last year, totaling 181.9 million decaliters. However, liquor and vodka products grew by 13.4% (to 16.7 million decaliters), while the main decline was due to reduced consumption of low-alcohol products. During the same period, alcohol production in Russia fell by 6.7%, to 158.5 million decaliters.
The Russian budget, after two months of surplus, returned to a deficit. In October, the Ministry of Finance spent 3.4 trillion rubles against revenues of 3 trillion, increasing the budget deficit from 3.8 to 4.2 trillion rubles over ten months.
The Russian economy is entering a prolonged downturn, as companies increasingly report financial difficulties, reduce expenses, and delay investments. By Q3 2025, the main problems for businesses were nonpayments from contractors, declining demand, and a shortage of working capital.
Since the end of 2024, annual economic growth in Russia fell from about 5% to near zero. Analysts cite inflation, military spending, and falling oil prices amid U.S. tariffs under Trump as key factors.
After three years of unexpected growth, Russia is facing a sudden slowdown — war expenditures, inflation, and falling oil prices are now putting pressure on an economy that once seemed resilient to sanctions.
