Nigeria’s food, beverages & tobacco (FBT) industry is a component of the manufacturing sector, which contributed 13 percent or N4.2 trillion to the country’s gross domestic product (GDP in current prices) in 2014 (2013: 11 percent or N3.8 trillion).
The FBT industry is a major component of the manufacturing sector and contributed 49 percent of the manufacturing sector’s output in 2014.
The sector’s performance was better than that of the oil refining industry which recorded negative growth of 6 percent in 2014. In the past three years the FBT has experienced various levels of growth. It grew by 12 percent in 2013 and 7 percent in 2012.
In terms of job creation, the food and beverage employs 5 percent or 1.5 million people. In 2014, the industry and the manufacturing sector created a total of 230,654 new jobs. (However, the manufacturing sector as a whole has always been male-dominated and 2014 was no exception with the industry employing 77 percent males and 23 percent females.)
In 2014, the largest fresh employee batch took place in the first and second quarters with about 183,675 new jobs being created, according to data from the Nigerian Bureau of Statistics (NBS). Overall, the sector accounted for 67 percent of new employees in 2014.
At present, there are more than 20 food and beverage companies quoted on the Nigerian Stock Exchange (NSE), mainly captured under the fast moving consumer goods (FMCG) asset class. In addition to quoted companies, many privately owned and unlisted companies exist.
Segments within sector
The food tobacco and beverages sector is made up of several components. The beverage market is largely dominated by the beer and carbonated soft drinks (CSD), processed juice, spirit and wines and other ‘Ready-to-drink’ beverages (RTDs) cover the balance. However, the processed juice market is gaining traction in considerable competition with the CSD segment.
The food segment is led by multinationals though there are several formidable domestic giants such as Dangote Foods. Major players in the industry include the Dangote Group (Sugar, Flour, Noodles, Juice, among others), Flour Mills of Nigeria, Honeywell Flour Mills, Nestlé, Cadbury, Promasidor, the Nigerian Breweries, Guinness, Nigerian Bottling Company, De-United Foods, among others.
The sector has an oligopolistic market structure: about 15 percent of the market players control 80 percent of the market share and revenues, while the remaining 85 percent are small and medium sized enterprises (SMEs) and account for only 20 percent of total sales volume. Foreign investment is largest in the beverages segment of the industry while the food segment is dominated by imports of packaged goods on one hand, and the domestic emergence of processing and packaging of local foods on the other.
Filled with data on the FBT industry, BRIU’s Food, Beverages & Tobacco (FBT) report (which is scheduled to be released in the first week of September) offers broad coverage of major segments of the beverages sub-sector, the food segment and the tobacco industry. It also covers the fast food industry as well.
In the food and beverage segments, the report covers the processed food and drink products, as well as brands of major manufacturers operating within our local environment. The products and brands covered in the report overlap as most of the major players’ profiled produce across several brand segments.
Food, beverage and tobacco industry includes players in beer, starch, flavouring, soft drinks and carbonated water, flour and grain milling, as well as tea, coffee and dairy products. The sub-sector also encompasses manufacturers in industries such as fruit juice, tobacco, biscuits and bakery products, sugar, distillery and blending of spirit, among others.
More information on the special highlights of the report will be published for general consumption while, the full report is available on request.
OMOSOMI OMOMIA
