Prospects for increased meat demand in sub-Saharan Africa

According to a recent IMS Economics Webinar, Sub-Saharan Africa (SSA) is a large, complex but exciting market prospect.

The reasons for this are in particular because of the following facts:

  • It represents a market of 1.1 billion people where the population is rising faster than any other continent in the world.
  • There has been a significant income growth in recent years in many of the countries – and this is likely to continue in the post-lockdown situation.
  • There is a historical growth in meat imports with further substantial increases expected.
  • Greater urbanisation is also playing an important role in increasing meat demand.
  • The protein deficit is to increase and with it the demand for affordable, nutrient dense products, including bone-in products, variety meats and offal.

Astonishing population growth trends

The rise in incomes has gone into reverse due to COVID-19, with reduced trading opportunities, the collapse of tourism and lower primary commodity prices. Debt levels are also increasing alarmingly. Many Sub-Sharan countries are already amongst the poorest in the world and even the more developed economies such as South Africa and Gabon still rank below 100th place in world GDP per capita tables.

The only countries with significantly higher levels of income per head are the islands of Reunion, Seychelles and Mauritius, which have comparatively small populations. Major GDP reductions are expected in 2020 but economic growth is expected to resume in 2022 and beyond. The main engine of growth in meat demand is the astonishingly high population growth rate estimated at 2.6% per year. This is confidently expected to result in the SSA population by 2050 increasing by an additional 1 billion people. Unlike Asia, there is not likely to be a significantly “middle class” segment in the population so that the increase in meat demand is likely to remain for cheaper categories.

With this in mind, SSA importers are focused on price due to the very low incomes. For exporters, administrative burdens can be a nightmare, personal contact is essential although using traders with local networks can be valuable for dealing with these and other challenges. There is a market for chilled premium meats for hotels and supermarkets, but this is extremely limited and normally operated by specialized importers.

In conclusion, the latest projections suggest strong growth in meat imports into Sub-Saharan Africa countries over the next decade. Although livestock farming is a major source of income in many countries, domestic production is likely to be unable to keep pace with the rapid growth in meat demand. Some observers doubt of the ability of some countries to be able to pay for these imported products, however low-priced they might be due to the lack of currency.

On the other hand, Sub-Saharan Africa preferences are frequently for parts of the animal that are not in major demand elsewhere in the world. The key items to be traded will remain low-priced beef and pork cuts, chicken leg quarters, offal and cheap processed meat.

Source :International Meat Secretariat Newsletter