In the 2021, the total output value of domestic furniture manufacturers rose by about 30 percent, with a total market value of 4 billion euros (28.2 billion yuan) . Much of this growth has been driven by a surge in the number of new homes and apartments in Russia, higher prices for raw materials and components for furniture products, and a range of public and private sectors favouring local purchases over imports. It is also worth noting that the number of home-made metal office furniture increased by 78% , the food and beverage service market increased by 40% , the residential kitchen market increased by 30% , and the pure wood furniture market increased by 20% . Before the outbreak of NCP, imported furniture accounted for about 50% of the entire Russian furniture market. Between 2020 and 2021, the market share of imported furniture fell, stabilizing at about 40 percent. Even in the 2021,92.6 M sq m of new housing, up 14 per cent year-on-year, is not enough to restore imported furniture to its former glory. At the same time, imported furniture due to rising costs and more severe, the average unit price rose by 12% . The increase was due to a 40 per cent increase in component costs, a 35 per cent increase in chipfibreboard costs and a 300 per cent surge in the cost of decorative films and related accessories.

However, there is also an obvious possibility that official market share statistics are “Distorted”by a large number of small and medium-sized furniture manufacturers. This is due to the recent introduction of stricter regulations by tax authorities and the extension of financial incentives for registered enterprises introduced by the government after the epidemic, as a result, these manufacturers have moved from the grey economy, also known as the “Garage”economy, to the legal sector. Taken together, many in the industry believe that these factors are likely to spur at least a 20 per cent increase in the number of furniture produced in Russia in the short term. But that growth needs to be sustained by an increase in the number of new homes coming on to the market and easier access to fixed-term mortgages. In addition, Russia has a large number of domestic consumer groups (such as immigrants from Central Europe) . With the end of travel restrictions associated with the new pneumonia, many Russians are keen to renovate their “Second homes”in more remote parts of the country. Finally, many wealthy Russians have started investing in one or more apartment buildings, either to buy them for rent or as a future home for their children. Although domestic production of furniture products is increasingly dominant in Russia, this does not mean that the door to opportunities for foreign manufacturers, such as suppliers and distributors in Hong Kong, has closed. In fact, there are still plenty of opportunities for foreign manufacturers in accessories, small/foldable furniture and high-end products. As to which product category is the best target for an “Attack”, look to Russia’s leading online market and local version of the product catalog. Inevitably, however, the current situation in Russia and Ukraine, as well as sanctions and trade embargoes against Russia, will make it likely that foreign manufacturers will have to seriously consider future export agreements with Russia.