News

Russia imposes vodka price increase

07 January 2025 By Louis Thomas

Russia’s Ministry of Finance has introduced a 17% increase on the price of 0.5 litre bottles of vodka, a further sign of the critical condition of the country’s economy.

As of 1 January, the Ministry of Finance has raised the minimum price of a half litre bottle of vodka from 299 (£2.20) rubles to 349 (£2.57) – an increase of 50 rubles (£0.37).

This latest increase follows the rise in price back in June 2024 from 281 rubles (about £2.07 today) up to the 299 figure that it was prior to the start of this year, meaning that the new price is 24% above what it was six months ago.

The price of brandy has also been jacked up by 17%, and the price of a pack of cigarettes has increased by 5% to 135 rubles (£1.01).

Almost three years after Putin’s invasion of Ukraine, and the sanctions imposed on Russia by foreign powers, the Russian economy looks to be headed for a challenging 2025. Economic concerns prompted Russians to buy up alcoholic drinks at record pace in 2024, with almost two billion litres of alcohol sold through retail in the first 10 months of the year, the highest level since 2017.

Vodka producers had been pressuring the Kremlin to raise the price of the spirit in order to match the wartime inflation-induced increases in costs. Towards the end of 2024, inflation in Russia reached 9.5%, with Russia’s central bank maintaining the key interest rate at 21%.

In spite of the challenges, vodka remains big business in Russia, with one business recently trademarking one branded in honour of incoming US President Donald Trump, and one of the country’s biggest popstars trying to register “Ya Russky” as a trademark for drinks, household goods, and sex toys.