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Frost & Sullivan declares Russian waste management market open to investors and advanced technologies


Source: Frost & Sullivan

The Russian waste management market is growing, with substantial investments still required for service providers to cope with waste in accordance with sanitary and environmental standards. Improvements in technology, management expertise and diversification of services are necessary in order to foster growth in existing waste management services as well as for recycling and other types of waste processing methods. Heightened government and public awareness, coupled with initiatives and programmes attracting Russian and international investors, promise to open up lucrative opportunities in this market.

New analysis from Frost & Sullivan (, Strategic Opportunities in the Russian Waste Management Market, finds that the market earned revenues of $1,277 million in 2009 and estimates this to reach $2,166 million in 2016.

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In Russia, waste service tariffs are increasing, driving market revenues persistently every year. In 2009, tariffs rose, depending on each region, by approximately 10 per cent, directly impacting revenues for all incumbent market participants.

'Given that the tariff rates are low, market expansion is guaranteed,' notes Frost & Sullivan Research Analyst Emilia Jelenska. 'In addition, legislative and public pressure is further supporting market prospects.'

With growth in tariffs on waste management services, existing market participants will be able to develop better strategies and more efficient processing methods. Moreover, higher tariffs will attract more investments as foreign and international waste management companies enter the market, thereby propelling market growth.

The most significant challenge the market currently faces is the inability of waste treatment plants to process the large volumes of waste generated due to outdated technology. Waste is often managed through illegal disposal on unauthorised landfills, with environmental pressure making this an infeasible practice. Waste thus disposed is as much of an environmental liability as it is an inefficiently managed resource.

'Expanded state programmes and investments by private market participants could boost technological development to levels where waste would not only stop polluting the environment, but be used or re-used efficiently as energy, fertilizers, or recycled by-products, like in Europe or North America,' remarks Jelenska. 'Landfill disposal is no longer as lucrative an opportunity as more developed services like recycling and waste-to-energy treatment.'

International participation in the Russian market is expanding with public private partnerships (PPPs) offering a route for technological improvements and service offerings. The next step for this developing market is for local Russian waste management companies to intensively re-position their services as early as possible.

'PPPs have shown the route for market entry into the region,' concludes Jelenska. 'International waste management companies, as well as regional participants capable of making the proper investments stand to maximize growth and advancement in waste services.'

Strategic Opportunities in the Russian Waste Management Market is part of the Environmental Growth Partnership Services programme, which also includes research in the following markets: Global Biological Waste to Energy Plant Market, Strategic Opportunities in the European Waste Recycling Market, M&As in the European Waste Management Market and European Batteries Waste Recycling Market. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

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