SOUTH AFRICA – The South African food retail sales reached US $44.9 billion in 2017 on increasing demand for organic and natural products by consumers, a report by USDA’s GAIN has revealed.
Growth in the sector is associated with development and production of high quality and niche products in the domestic market plus a strategy to expand into the rest of the continent.
As consumer dynamics change, supermarket giants such as Woolworths, Pick n Pay, Checkers are embarking on innovations that is, introduction of new organic and natural options to their range of products.
Among the top growth products in the period include chicken cuts and edible offal, beer made from malt, swine meat, coffee extracts, pet food, bakeries and confectioneries.
The food retail market is concentrated with local retailers Shoprite, Pick n Pay, Massmart, Spar, Woolworths, the Food Lovers Market, and Choppies, who are expanding with solid growing footprints into other African countries.
Convenience and fast food stores including smaller format express stores, and small grocery shops catering to the convenience retail market are rapidly growing in South Africa.
Convenience stores sales totalled US $2.4 billion at 872 outlets with convenience stores attaching to forecourts retailing gas stations and these include Woolworths/Engen; Pick n Pay/British Petroleum (BP); Fruit & Veg City of Food Lovers Market/Caltex; Burger King/Sasol; Steers/Shell, and Wimpy/Engen.
With this development, US seeking for every opportunity for a slice of the export market in agricultural commodities but will face competition from the EU, MERCOSUR and South African producers in the Southern African Development Community (SADC).
Swaziland is a key exporter of food/drink ingredients and raw cane sugar to South Africa.
Others include Argentina (soybean oil cake and soybean oil), and Indonesia (palm oil and palm kennel).