Africa's Food And Beverage Industry Grows Steadily Despite Roadblocks

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Researched by Industrial Info Resources (Sugar Land, Texas)--Africa is currently experiencing an economic upswing, especially in the Sub-Saharan region, with an anticipated gross domestic product (GDP) growth rate of 3.8% in 2024 and 4.2% in 2025. As the economy grows, the region's demand for food and beverages has also increased. This growth is driven by factors such as rising urban population and shifting consumer preferences toward foreign cuisines and convenience foods. In addition, a dynamic ecosystem of players, from small local startups to large global conglomerates, also has aided the market expansion.

Despite immense potential, the industry faces challenges as Africa grapples with issues like rural poverty, food insecurity and supply-chain limitations. As reported by the World Economic Forum in 2022, about 20% of Africa's population (257 million people) suffered from chronic hunger. As Africa is heavily dependent on imports for staples such as rice and wheat, the country's food and beverage market is often hampered by geopolitical tensions, climate shocks and global price fluctuations. Furthermore, domestic supply disruptions resulting from increased input costs, inadequate logistics and local currency depreciation have significantly added to the sector's inefficiencies.

Industrial Info tracking 1,391 operational food and beverage plants in Africa, with a majority of them operating in South Africa (361), Egypt (249) and Kenya (170). Subscribers to Industrial Info's Global Market Intelligence (GMI) Food & Beverage Industry Plant Database can click here for the plant profiles.

IIR also is tracking about 1,000 active capital-spending Food & Beverage Industry projects in Africa, worth US$18 billion. Subscribers to the Food & Beverage Industry Project Database can click here for a list of detailed project reports.

Algeria is the biggest driver of investment, with a market share of 25% and an investment value of more than US$4 billion. It is followed by Egypt and Nigeria with a total spend pipeline of more than US$5 billion across 202 projects combined. Morocco also gathers a significant investment of about US$1 billion. Other countries with substantial investments include Kenya, South Africa and Uganda.

Power International Holding (Doha, Qatar), MICT Nigeria Ltd (Anambra, Nigeria) and Sonatrach (Algiers, Algeria) are the leading players in the market with an aggregate spend of more than US$6 billion and a combined market share of 36%.

The dairy sector in Africa drives the most spending (about US$4 billion). As the leading investor, Power International Holding, through its subsidiary Baladna Food Industries Company, is investing to set up a grassroot dairy processing plant in Guezzam, Algeria, with a capacity of 1.7 billion liters of milk per year. Subscribers can click here to read the project report.

The agricultural products sector also is garnering a sizable investment of more than US$3 billion across 296 projects. Agriculture makes up about 20% of Sub-Saharan Africa's economy, and the continent is home to 60% of the world's uncultivated arable land.

In addition, desalination projects make up about US$3 billion of the overall spend. Office National de Electricite et de Eau Potable (ONEE) is planning to construct a 548,000-cubic-meter-per-day desalination plant in Casablanca, Morocco, with an expandable capacity of up to 822,000 cubic meters per day. Click here to read the project report.

About 67% of the total spending is aimed at grassroot projects, while around 20% is toward unit additions. With 60% of the investment in the planning phase, 28% under construction and 12% in the engineering stages, most of these projects are anticipated to be completed in December 2025-2026, while the rest will reach fruition by December 2028.

The future of the Food and Beverage market in Africa is anticipated to be shaped by improvements in the food supply chain and formulation of fiscal policies to ensure food availability and affordability on the continent. With 289 food and beverage plants likely to come up in Kenya, Egypt and Uganda by 2028 (many of which will be starting between 2024-2026), the African food and beverage market is poised for growth. Click here for a list.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).