Monday, 10 May 2021

Middle East & Africa Organic Food & Beverage Market | Market Size, Market Share, Market Trends

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The region's farmers are making more money producing organically grown crops for European markets, where demand for healthier food is growing. According to the report titled 'Middle East & Africa Organic Market Outlook, 2026' by Bonafide Research, the market is to grow with an anticipated CAGR of less than 16%. Valued at USD 3.03 Billion in 2015, the majority of sales come from foreign exports, while due to the unawareness about the benefits the local consumers are not keen to pay a premium price. There are opportunities for small farmers of the region in the global market for some tropical products that cannot be grown in North America or Europe, for example, products like organic cocoa or organic sugar, organic fruits, and vegetables.

Following the organic food & beverage and dairy product segment, the frozen & processed food segment accounted for a market of USD 0.76 Billion in 2020. The support from the government is playing an important role in accelerating the organic farming agenda in the region. The region is seeing a rise in vegan products from the US, particularly when it comes to meat substitutes, with brands like Beyond Meat and Impossible Foods penetrating the market, although these are currently not certified organic. The increasing per capita consumption of beverage primarily fruit juices has created a great platform for the foreign manufacturer to penetrate in the regional market. In addition, the companies are creating new flavours that are expected to compete with traditional flavours at the top of which are peach, pomegranate, pink guava, and lemon with mint. However, fruit juices such as mango, apple, orange, guava, and strawberry remained the most preferred juices among the consumers in the country. The organic beverage segment was lead by non-dairy beverages, while organic beer & wine remained the least contributor with a share of 1.97% in 2020.

The modern retail segment accounted to a share of 51.58% in the year 2015 supported the market growth with a discounted prices and a variety to choose from. The price reduction plays an important role in the region mainly as it persuades people to pay a slightly higher price from conventional product. People are now willing to pay a higher amount category like grains and pulses, where earlier they simply wanted to opt for a cheaper option. Even though the modern retail segment is to lead, the online sales channel segment is likely to reach a market value of USD 2.27 Billion by the end of the forecasted period.

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The market is led by Saudi Arabia, which held to a share of 11.75% in 2015 and was followed by South Africa. The issue in this region is staying true to the essence of the organic lifestyle, which means buying in locality and buying seasonal produce, to consume fresh from the farm within a relatively short timeframe. In Africa, significant efforts have been made in mainstreaming organic agriculture into policy, national extension systems, marketing and value chain development, and curricula of some academic institutions and research activities in the region. Advancements in technology and innovative products, along with the introduction of new flavours and products containing low fat, low sugar, and low sodium levels, are all factors that have gained the attention of the consumers. In the UAE, the major organic product suppliers have witnessed a spike of as much as 300-400% in their sales. This is because the residents have become highly conscious of their health, amidst the COVID-19 pandemic. One of the manufacturers to have witnessed a major spike in its sales is Greenheart Organic Farms. There is a growing awareness of organic food and increasing adoption of different cuisines due to the sizeable expatriate population. A shift toward domestic production will help achieve food sufficiency and security per Saudi Vision 2030 and UAE National Food Security Strategy 2051. In South Africa, the organic sector pioneered private practices and systems in small informal groups to guide the public and private sectors on environmental and sustainability issues.

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