Food Business Africa July/August 2021 by FW Africa

FOOD BUSINESS A F R I C A ’ S

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DAIRY BUSINESS AFRICA:

FOOD STARTUPS AFRICA:

• SENDELET FOODS • SAGE VALLEY

ICE CREAM INNOVATION MILLING & BAKING AFRICA:

MYCOTOXINS IN POULTRY BEVERAGE TECH AFRICA:

FUNCTIONAL BEVERAGES BOOM PACKAGING:

TRENDS IN MEAT PACKAGING

EXECUTIVE INTERVIEW

ANDREW CHINTALA

President, Millers Association of Zambia

COMPANY FOCUS:

PEPSICO: African

strategy on track

AFRICA’S TOP 100 FOOD COMPANIES

BAKHRESA GROUP:

Taking a bite at Africa’s growth trends WWW.FOODBUSINESSAFRICA.COM

YEAR 9 | ISSUE NO. 47 JULY/AUG 2021

The Art of European Meat

Hindquarter Carcass with jowl

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Find your Belgian meat master at artofmeat.eu

THE CONTENT OF THIS PROMOTION CAMPAIGN REPRESENTS THE VIEWS OF THE AUTHOR ONLY AND IS HIS/HER SOLE RESPONSIBILITY. THE EUROPEAN COMMISSION DOES NOT ACCEPT ANY RESPONSIBILITY FOR ANY USE THAT MAY BE MADE OF THE INFORMATION IT CONTAINS.

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JULY/AUG 2021 | FOOD BUSINESS AFRICA

CONTENTS

YEAR 9 | ISSUE NO. 47 JULY/AUG 2021

39 Food Startups Africa:

Sendelet Food: Refreshing Ethiopians with real fruit juice products

30 Executive Interview:

ANDREW CHINTALA - President, Millers Association of Zambia

Company Highlight: Bakhresa Group takes aim at a bigger piece of Africa

35 Food Startups Africa:

Sage Valley: Bringing some zest into Zambia’s kitchens

ON THE COVER Andrew Chintala President of Millers Association of Zambia 4

JULY/AUG 2021 | FOOD BUSINESS AFRICA

48 Company Focus:

PepsiCo Africa's strategy could succeed this time round FOODBUSINESSAFRICA.COM

CONTENTS

YEAR 9 | ISSUE NO. 47 | JULY/AUG 2021 REGULARS 8 Editorial 10 Events Calendar

News Updates: • Nigerian manufacturing giant Mamuda Group diversifies operation with commissioning of new beverage unit • RFG eyes bigger share of frozen foods market in SA with acquisition of Pioneer Foods’ business • Coca-Cola HBC eyes entry into Africa’s second largest non-alcoholic ready to drink market • Africa’s leading retailer Shoprite shifts focus to home market • European soft drinks industry commits to reduce sugar content in beverages by 10% before end of 2025 • Kenyan integrated food producer SimpliFine taps into fast growing frozen food, ready-to-cook segment • Beer Sectoral Group appoints Guinness Nigeria’s CEO Baker Magunda as group Chairman • Coca-Cola maintains lead as world’s most valuable beverage brand • Coca-Cola partners with Angolan beverage company Refriango to locally produce Minute Maid brand • Upfield’s plant-based spreads save 6 million metric tonnes of CO2 annually • PepsiCo targets to replenish more water than it uses by 2030 • Independent alcohol company DGB takes over ownership of SA’s century old wine business Backsberg

Supplier News & Innovations: Mathews Company launches new grain dryer line | Tetra Pak, Stora Enso partner to boost Europe’s carton recycling capacity | Tate & Lyle partners Kellogg’s to offer free online course on benefits of dietary fibre | Arla Food Ingredient unveils new whey ingredient to support production of high protein yogurts | DSM unveils new phage-robust culture rotations to help manufacturers overcome spoilage issues in cheese | Cargill, Continental Grain to acquire US poultry producer Sanderson Farms for US$4.53bn

DAIRY BUSINESS AFRICA 53 Ice Cream: Scoops of delight unravelling tonnes of treats BEVERAGE TECH AFRICA 59 Pandemic stimulates appetite for functional beverages as it stirs innovations and new product developments MILLING & BAKING AFRICA 63 Managing the Mycotoxins Challenge in Poultry FOOD NUTRITION & HEALTH 67 Watermelon is a summertime staple. But what's hidden behind the sweetness? PACKAGING 70 Convenience, sustainability, safety and quality drive trends in meat packaging

JULY/AUG 2021 | FOOD BUSINESS AFRICA

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EDITORIAL

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Year 9 | Issue 4 | No.47 • ISSN2307-3535

FOUNDER & PUBLISHER Francis Juma EDITORIAL Catherine Wanjiku | Paul Ongeto ADVERTISING & SUBSCRIPTION Jonah Sambai | Hellen Mucheru DESIGN & LAYOUT Clare Ngode PUBLISHED BY: FW Africa P.O. Box 1874-00621, Nairobi Kenya Tel: +254 20 8155022, +254725 343932 Email: info@fwafrica.net Company Website: www.fwafrica.net

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Food Business Africa (ISSN 2307-3535) is published 6 times a year by FW Africa. Reproduction of the whole or any part of the contents without written permission from the editor is prohibited. All information is published in good faith. While care is taken to prevent inaccuracies, the publishers accept no liability for any errors or omissions or for the consequences of any action taken on the basis of information published.

JULY/AUG 2021 | FOOD BUSINESS AFRICA

The food industry has a role to play in making nutritious foods more accessible and affordable, especially for developing countries

alnutrition continues to be a major problem in every country in the World, putting millions of people at risk to diet related problems and contributing towards the death of millions of others. In 2019, about 690 million people (8.9% of the global population) were considered undernourished, according to FAO. The Covid-19 pandemic has further pushed many into extreme poverty, making access to food a serious problem - reversing any gains that could have been made towards achieving United Nations Sustainable Development Goals related to nutrition. No other industry is uniquely placed to address the nutrition gap crisis than the food industry. Right from product formulation to labelling and marketing, food companies can play a role in bridging the nutrition gap. Nestle, the world’s largest food company, says that its products reach more than 1 billion consumers every day across the world. This just shows the impact one company can have in availing healthy products and actively influencing consumers into making healthy decisions. Recognizing the power that large food companies like Nestle wield, The Access to Nutrition Initiative (ATNI) has been assessing how the world’s largest global food and beverage manufacturers contribute to addressing malnutrition in all its forms: overweight and obesity, undernutrition, and micronutrient deficiency. Recently, ATNI released the 2021 Global Index where Nestle, Unilever, and Friesland Campina topped the rankings for their broad-based efforts

in helping bridge the nutrition gap. In a statement, ATN said the 2021 results show that companies need to enhance their efforts to encourage healthier diets for all. To help bridge the nutrition gap, the report recommended that food companies double down on product innovation and reformulation to bring more healthy products to the market. It also recommended manufacturers invest in marketing policies that accelerate efforts to drive sales of healthy options. Providing comprehensive nutrition information on all product labels was also encouraged to help consumers make informed decisions. From the ranking, one thing that came out clear was that companies that scored highly on governance tended to score better across other categories too, which suggest that nutrition activities are likely to be better sustained where commitment starts at the top, integrated into core business strategy and publicly and comprehensively reported on. African companies do not appear on the Global access to nutrition index, but they collectively feed over 1.25 billion people, and therefore have a role to play if UNSGDs on nutrition have to be realized - certainly they can borrow a leaf or two! As an African focused magazine, we always endeavor to bring you stories of African-focused food enterprises. In this edition we bring you bold stories from Sage Valley in Zambia to Sendelet Foods in Ethiopia. We also have a deep dive into the operations of the Bhakresa Group and foray of PepsiCo into the African market, which we hope will be worth your time. We wish you a good read. FOODBUSINESSAFRICA.COM

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EVENTS CALENDAR

September 1-3, 2021 Food & Beverage West Africa Lagos, Nigeria Focus: Food & Beverages https://fab-westafrica.com/ September 8-9, 2021 Dutch Poultry Expo Hardenberg, Netherlands Focus: Poultry https://www.dutchpoultryexpo.nl/en/ September 9-12, 2021 WorldFood Istanbul Istanbul, Turkey Focus: Food & Beverage https://worldfood-istanbul.com/Home September 14 – 16, 2021 Halal Expo Nigeria Abuja, Nigeria Focus: Food & Beverages www.accinigeria.com/event/halalexpo-nigeria-2020 September 22-24, 2021 Petfood Forum Hybrid, Missouri-USA Focus: Animals & Pets www.petfoodforumevents.com October 09-13, 2021 Anuga Food & Beverage Fair Cologne, Germany Focus: Food & Beverage www.anuga.com October 11 – 14, 2021 Sipsa-Filaha & Agrofood Mohammadia, Algeria Focus: Food, Beverage & Agriculture https://sipsa-filaha.com/?lang=en October 14-16, 2021 Bakery China Shanghai, China

Focus: Bakery and Baked goods https://www.bakerychina.com/en October 20-22,2021 Graintech Africa Nairobi, Kenya Focus: Grain & Milling https://www.graintechafrica.com/ October 26-28, 2021 Grocery Innovations Canada Online Focus: Food & Beverages https://virtual.groceryinnovations.com/ October 27-29, 2021 China Fisheries & Seafood Expo Qingdao, China Focus: Fisheries & Seafood https://chinaseafoodexpo.com/ October 28-30,2021 African Livestock Exhibition and Congress Addis Ababa, Ethiopia Focus: Livestock https://africanlivestock.net/ November 07-09, 2021 Gulfood Manufacturing Dubai, United Arab Emirates Focus: Food & Beverage www.gulfoodmanufacturing.com

November 24-27, 2021 SIAB EXPO MAROC Casablanca, Morocco Focus: Food & Beverage http://siabexpo.com/en/ home/?lang=en December 2-4, 2021 AFMASS Food Expo Nairobi, Kenya Focus: Food, Beverage & Milling www.afmass.com December 3, 2021 Africa Food Industry Excellence Awards Nairobi, Kenya Focus: Food, Beverage & Milling www.awards.foodbusinessafrica.com December 2–4, 2021 Drink Technology India Gujarat, India Focus: Beverage https://www.drinktechnology-india. com/en/ December 3-5, 2021 Tanzfood Arusha, Tanzania Focus: Food & Agriculture https://www.tanzfood.com/

November 10-13, 2021 World Food Expo Hybrid, Mandaluyong-Philippines Focus: Food & Beverage https://wofex.com/wofex-manila

December 7-8, 2021 The Africa Sugar Conference Kampala, Uganda Focus: Sugar https://informaconnect.com/africasugar/

November 24-26, 2021 Addis Inter Food Machinery Addis Ababa, Ethiopia Focus: Process & Pack http://addisinterfood.com/

December 12-14, 2021 Food Africa Cairo Cairo, Egypt Focus: Food & Beverage http://www.foodafrica-expo.com/

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NEW FOOD PRODUCT INNOVATIONS

Pearl Dairy UHT Milk

Uganda’s leading dairy processor, Pearl Dairy Farm Limited (PDFL), has expanded its milk offering with launch of its new UHT whole milk under its brand name Lato. Leveraging on Tetra Pak’s Aseptic technology, the new offering is said to have a shelf-life of 12 months without refrigeration and about 7 to ten days after opening when continuously refrigerated. Lato UHT whole milk comes in black mate carton packs of 500ml and 1 litre sizes.

www.latomilk.com

Golden Penny Noodles

Golden Penny, the iconic brand of Flour Mills of Nigeria, has launched a new flavour for its noodles brand, now coming in Goat Meat Pepper Soup flavour. The new product gives consumers a taste of the classic Nigerian cuisine, which is widely enjoyed by the citizens. The new product is available across all retail stores enabling consumers to conveniently access them and whip up the scrumptious meal in just under 5 minutes.

www.fmnplc.com

South African Breweries Double malt drink South African Breweries has launched the country’s first double malt beer dubbed Castle Double Malt. The new offering joins the Castle family comprising of Castle Lager, Castle alcohol free Lager, Castle Lite and Castle Milk Stout. Making a bold statement of its pride of the local heritage, Castle Double Malt brings a perfect union of flavour and refreshment by combining two carefully selected malts from Caledon and Alrode, giving rise to a superior lager.

www.sab.co.za

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Glacier Products Premium Ice Cream Glacier Products Ltd has expanded its portfolio with launch of a new line of yoghurt products and biscuit snack in Kenya. The yoghurt is available in strawberry, vanilla, mango, blueberry, and orange flavors and unique blends of kiwi apple, peach mango, pineapple coconuts etc. coming in uniquely shaped 150ml and 550ml cups. The dark-blue triangle shaped cups offer consumers a firm grip as they enjoy the dairy drink.

www.glacierindustriesnw.com

Kenafric Industries Activated charcoal chewing gum Kenafric Industries, has launched Africa’s first activated charcoal chewing gum. The product dubbed ‘Fresh Active’ is a tooth cleaning powerhouse, offering great oral healthcare while leaving a lasting cooling effect that enhances fresh breath. The gum will be available in two variants, cool mint and cool watermelon.

www.kenafricind.com

Keroche Breweries High Alcohol beer Keroche Breweries Limited, an alcoholic beverage manufacturer in Kenya has yet again introduced another strong beer in the market under the brand name X Beer. The new drink targets the high-end market as it is sugar-free and has an alcohol by volume content of 8.8%.

www.kerochebreweries.com

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NEWS UPDATES

NEWS UPDATES by www.FoodBusinessAfrica.com FUNDING

Nigerian manufacturing giant Mamuda Group diversifies operation with commissioning of new beverage unit

Mamuda Group, one of Nigeria’s leading diversified manufacturing conglomerate has introduced a new carbonated soft beverage drink in the market dubbed Pop Cola. The new offering is produced at the company’s newly

NIGERIA –

commissioned factory in Kano State, Northern Nigeria. The inauguration of the manufacturing giant’s new subsidiary, Mamuda Beverages Limited, is a testament to its commitment to the Nigerian economy as it diversifies its operations from manufacture of agriculture products packaging, snack processing, leather tanning, alongside operation of power plants. The official opening of the factory comes months after Mamuda Group, inaugurated its multi-billion Naira confectionery factory, under its subsidiary Mamuda Foods Company.

FOOD SAFETY

RFG eyes bigger share of frozen foods market in SA with acquisition of Pioneer Foods’ business SOUTH AFRICA – RFG Holding, South Africa-based producer of fresh, frozen and long-life convenience meal solutions, has entered into an agreement with Pioneer Foods Wellingtons, to purchase its frozen foods business as a going concern. The business in question comprises of a wide product range to include: frozen pies, pastry, sausage rolls, pizza and party packs, under the well-established brands such as, Today, Mama’s, Big Jack and Man’s Meal. Manufacturing of the products is conducted from a facility in Atlantis in the Western Cape and are distributed nationally. The business commands a strong presence in the frozen pies and pastry segment, servicing mostly the South African top end retail market. To this end the acquisition is aligned with the company’s strategy of expansion through value accretive acquisitions.

“The frozen pie and snack category in the top end retail market complements RFG’s growing pies and pastries business. The acquisition has the potential to generate good synergies for the company while also diversifying

our offering into the retail channel,” CEO RFG Bruce Henderson said. The transaction is subject to approval by the Competition Commission and the effective date is expected to be 1 January 2022.

NEW SPIRITS LINE

Rwanda to boost local production of edible oil with US$10m investment in new processing plant RWANDA – Kayonza Distribution Company Ltd, a Rwandese retail and distribution company, has invested US$10 million in the establishment of an edible oil manufacturing plant. The investment is aimed to boost local supply of cooking oil in the country and trim the import bill. Targeted to commence operations by the end of the year, the processing facility is expected to produce 100 tonnes of cooking oil per day. With this new investment, Rwanda hopes to gradually reduce cooking oil imports, which peaked at 126,002 metric tonnes last year, up from 121,981 metric tonnes in 2019. 14

JULY/AUG 2021 | FOOD BUSINESS AFRICA

The East African country spent a staggering Rwf106 billion (US$105m) on the importation of the commodity last year, which is among the top 10 products that were shipped into the country. Rwanda produces at least 80,000 metric tonnes every year and imports an average of 125,000 metric tonnes, making it a net importer of cooking oil. A rise in local production of cooking oil will also increase competition among producers and thus reduce prices. Also increased investments will potentially boost exports.

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DISTRIBUTION CENTRES

Coca-Cola HBC eyes entry into Africa’s second largest non-alcoholic ready to drink market EGYPT – Coca-Cola HBC, the world’s third-largest Coca-Cola anchor bottler, is seeking to acquire a majority stake in Coca-Cola Bottling Company of Egypt (CCBCE) through its subsidiary Coca-Cola HBC Holdings. Under the agreement, Coca-Cola HBC will acquire 94.7% stake in the Egyptian unit from its majority shareholders for an agreed combined purchase price of US$427 million. CCBCE was founded in 1994 as

THE TRANSACTION WILL ENABLE COCA-COLA HBC ACCESS THE SECOND LARGEST NARTD IN AFRICA BY VOLUME a joint venture company between The Coca-Cola Company through the TCCC Seller and MAC Beverages Limited (MBL) together with certain of its affiliated entities.

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INGREDIENTS SHOW

MBL, a privately owned group with investments in the beverages and packaging sectors in the MENA region, and certain of its affiliated entities and individuals currently have an approximately 52.7% shareholding in CCBCE. While the TCCC Seller has an approximately 42% shareholding in the company, with the balance of the shares held, and will continue to be owned by a diverse group of minority shareholders. “We are excited to welcome CCBCE to our group. We see great potential for this business to unlock considerable opportunities in the Non-Alcoholic Ready to Drink market (NARTD) category in Egypt. With our best-in-class execution capabilities, commercial expertise and world leading approach to sustainability and communities, we believe there

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is a significant opportunity to create value for all stakeholders,” Zoran Bogdanovic, CEO of Coca-Cola HBC, said. Finalization of the proposed transaction will enable Coca-Cola HBC access the second largest NARTD in Africa by volume, building on existing scale in Nigeria.

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BRIEFS Coca-Cola Beverages Africa undertakes leadership restructuring

SOLAR ENERGY

Africa’s leading retailer Shoprite shifts focus to home market

SOUTH AFRICA – Shoprite’s grocery

AFRICA – Coca-Cola Kwanza, the Tanzanian subsidiary of CocaCola Beverages Africa (CCBA), has appointed Unguu Sulay as the new Managing Director with effective 28th June 2021. The new appointee brings on board extensive leadership experience in risk and compliance, business strategy and governance. He joined the company from Plasco Limited where he was the Chief Financial Officer. Mr Sulay took over the helm of the company from Andrew Musingo, who was the CEO of the organization since January 2020. Andrew was promoted to be the new Chief Integration Officer of the parent company as of 01 August 2021. As part of the leadership restructuring by the region’s largest Coca-Cola bottler, Tshidi Ramogase was named the Public Affairs, Communications and Sustainability (PACS) Director of the company. A seasoned Public Affairs, Communications and Sustainability veteran, Tshidi was Head of PACS at CCBA since 2019, prior to her recent appointment.

JULY/AUG 2021 | FOOD BUSINESS AFRICA

unit Checkers has come to the rescue of South African retailer Massmart, by entering into a deal to acquire the rival’s non-core food assets for R1.36 billion (US$89m). Under the deal, Shoprite is buying Cambridge Food, Rhino Cash and Carry business comprising of 56 grocery stores, including 43 adjacent liquor stores; three Fruitspot business; Massfresh Meat business with a meat processing facility; and 12 Masscash Cash and Carry stores. The transaction is expected to close early in the first quarter of 2022 with the proceeds to be channelled by Massmart to pay down drawn bank facilities and for investments in e-commerce, general merchandise, do-it-yourself and wholesale food and liquor businesses. For Shoprite, a leader in highvolume and discount retail, the deal will give it a bigger slice of the R595 billion (US$39 billion) food and grocery retail market. The company is continually setting itself apart from its peers, as it is currently piloting the first of its kind cashier-less store in the region dubbed Checkers Rush. The automated, cashless “no queues, no checkout, no waiting” concept store is under trial by its employees within the company offices in Cape Town, above the new Checkers Hyper Brackenfell flagship store. Using advanced AI camera

technology to identify the products being taken off the shelves, Checkers Rush bills users’ bank cards upon exit. This is one of the numerous digital innovations under development in FOR SHOPRITE, THE DEAL WILL GIVE IT A BIGGER SLICE OF THE R595 BILLION (US$39 BILLION) FOOD AND GROCERY RETAIL MARKET. its newly launched ground-breaking digital business hub, ShopriteX which is combining data science, technology and innovation with its operational strength to provide increasingly enhanced customer experiences. ShopriteX has already delivered two industry-leading innovations – Xtra Savings, South Africa’s fastestgrowing rewards programme with 20 million members to date, and Checkers Sixty60 the first on-demand 60-minute supermarket grocery delivery service in South Africa. As the supermarket chain continues with its growth strategy in the home market, Shoprite is reviewing its operations outside South Africa with the retailer recently classifying its businesses in Madagascar and Uganda as discontinued. This follows the transfer of ownership of its Nigerian operations to Ketron Investment Limited in June this year and the closure of its last store in Kenya, earlier in the year.

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REGULATORY

European soft drinks industry commits to reduce sugar content in beverages by 10% before end of 2025 EUROPE – To help build healthier communities in Europe,

the European Soft Drink Association (UNESDA) has been championing efforts to reduce sugar levels in carbonated soft drinks (CSDs) for more than 2 decades now. The association has been working to offer smaller package sizes to enable consumers to manage their consumption of soft drinks and support healthier diets. With diabetes and obesity levels still on the rise, the European Sugar Industry led by its umbrella association is stepping up its health campaign by lowering sugar content

levels even further. “We are now taking a step forward and are committing to reducing the average content of added sugars in our beverages by another 10% from 2019-2025,” UNESDA said in a statement. “This will represent an overall reduction of 33% in average added sugars in the past two decades.” Since 2006, the European Sugar Industry has pledged not to advertise any soft drinks to children under 12 on television and on the radio, in print and online, including ONLY NO- AND LOW-CALORIE SOFT DRINKS WILL BE AVAILABLE FOR SALE IN EU SECONDARY SCHOOLS AND ONLY IN NON-BRANDED VENDING MACHINES social media and on company-owned websites. To further protect children from exposure to sugary drinks, the industry now commits not to market or advertise any soft drinks to children across all media. “We are raising the minimum age limit to 13 years old and lowering the audience threshold to 30% so that in practice fewer young children will be directly exposed to advertising for any of its soft drinks,” UNESDA said. The association has further committed that its members will not sell selling nor advertising any soft drinks in EU primary schools. Additionally, only no- and low-calorie soft drinks will be available for sale in EU secondary schools and only in nonbranded vending machines, without logos or commercial communications. FOODBUSINESSAFRICA.COM

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The Food, Logistics, Cold Chain & E-Commerce Expo showcases the latest technologies in the supply chain, logistics, storage and e-commerce for food and agriculture sector in Eastern Africa, including: Cold Chain Solutions • Warehousing Solutions • Mobility Solutions • Fintech & New Technologies • Last Mile Connectivity Solutions • Mobile Technology & Apps • Food Delivery Services & Solutions • Clearing & Forwarding Services • Freighting and Transport Services

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DAIRY FARM

Leading recycling company Extrupet sets up 1.3MWp solar plant to cut emissions

SUGAR INDUSTRY

Kenyan integrated food producer SimpliFine taps into fast growing frozen food, ready-to-cook segment

BRIEFS Beer Sectoral Group appoints Guinness Nigeria’s CEO Baker Magunda as group Chairman

KENYA – SimpliFine, a food production

SOUTH AFRICA – One of the pioneering

recycling companies in Africa, Extrupet, has taken its commitment to sustainable development even further with the launch of a brand new 1.3MWp solar power plant. Extrupet is one of the largest and most advanced recyclers of plastics on the African continent and recycles more than 4 million PET bottles every day at their Wadeville facility. With the switch to renewable energy, Extrupet has become one of the first companies in the recycling industry in the region to adopt solar power. The 1.3MWp solar plant, has an annual generation capacity of 2GWh and will reduce its carbon emissions by 1,800 tonnes every year, which is equal to the carbon sequestered by just under 31,000 tree seedlings grown for 10 years. “Not only will it help to alleviate the lost production time from load shedding, it will also offset the use of carbon-based electricity and improve the current carbon footprint of this important Bottle-2-Bottle plant. The investment in renewable power by Extrupet deserves recognition and we wish the project every success,” said Cheri Scholtz, Chief Executive Officer at PETCO. Extrupet has already commenced operations in the brand-new plant built in collaboration with Solarise Africa and NEC XON.

JULY/AUG 2021 | FOOD BUSINESS AFRICA

company offering fresh, locallysourced meat, vegetables, baked goods, and other foods to restaurants, hotels, and retail grocers across East Africa, has cut ribbon to its newly built food processing facility. This comes days after the company announced it will introduce 19 meat and vegetarian products in the market, as part of its rapid expansion strategy in the economy. These items include frozen meats, prepared meal accompaniments and a range of ready-to-cook prepared meals, complementing the quality French fries it supplies to restaurants, hotels, schools and catering businesses across Kenya. With the opening of the establishment, SimpliFine is targeting to grow its potato production and delivery, with plans to supply 450 tons of French fries by the end of 2021, the equivalent of more than 10 million meals. The company is also seeking to increase the availability of quality, locally-sourced foods, support the growth of regional farms and increase employment in the region. As SimpliFine grows its customer base, it will triple employment on its supplier farms by the end of the year. The company’s current customers include a mix of restaurants, hotels, and retail grocers. “We are thrilled to bring quality and great value food options to our customers, and to help drive new economic activity throughout Kenya,” said Steven Carlyon, President of SimpliFine. SimpliFine’s parent company BlackIvy recently acquired Alpha Fine Foods, a Kenyan producer of premium meat products.

NIGERIA – The Beer Sectoral Group (BSG), a section of the Manufacturers Association of Nigeria (MAN), has announced the appointment of Baker Magunda, as Chairman of the group with effect from 1st August 2021. Magunda is the the current Managing Director and Chief Executive Officer of Guinness Nigeria Plc. The BSG is a trade association comprising beer manufacturers in Nigeria. Its members include Guinness Nigeria Plc, Nigerian Breweries Plc, and International Breweries PLC. Magunda will now head the group whose mission is to develop the beer industry by encouraging sound professional practice among members and building understanding of stakeholders to promote responsible drinking and the social acceptance of beverage alcohol in the society. He replaces former BSG Chairman, Jordi Borrut Bel who has moved on from his position as Managing Director and Chief Executive Officer, Nigerian Breweries Plc, to take up new responsibilities within the Heineken Group. FOODBUSINESSAFRICA.COM

FINANCE

Coca-Cola maintains lead as world’s most valuable beverage brand

US – 129-year-old beverage manufacturing giant Coca-Cola has emerged, yet again, as the world’s most valuable brand in the just released ranking by Brand Finance, the world’s leading brand valuation consultancy. The annual rankings plot the world’s biggest soft drinks against each other, measuring brand value

through the strength of brands as well as metrics on marketing investment, stakeholder equity and business performance. Coca-cola which has for decades been crowned as the world’s most valuable and strongest soft drink brand continued to maintain its position at the top with a total brand value of US$33.2bn. With a brand value that is almost double that of second place Pepsi at US$18.4bn, the Atlanta based beverage giant seems well positioned to defend its position for years to come. “With a 129-year long history, Coca-Cola is still the most consumed soda in the world, with 1.9 billion servings, across 200 countries, enjoyed each day,” notes Brand Finance. “As with other brands globally, however, the brand’s parent company

pack

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Although Coca-Cola continues to dominate the beverage industry, this year, the honors in this years rankings went to Dr. Pepper which recorded a 40% brand value increase. Overall, the top place was taken by Swiss food manufacturing giant Nestlé – whose products include Nespresso and Nescafé among many others – with a portfolio value of $65.6bn.

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WITH A 129-YEAR LONG HISTORY, COCA-COLA IS STILL THE MOST CONSUMED SODA IN THE WORLD, WITH 1.9 BILLION SERVINGS, ACROSS 200 COUNTRIES, ENJOYED EACH DAY

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has not been immune to the impact of COVID-19, with the multinational forced to restructure and cut over 2,000 jobs.”

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WWW.AFMASS.COM The Process & Pack Expo showcases the latest food and animal feed milling, processing, packaging and laboratory technologies, including: Milling Equipment • Processing Equipment • Packaging Equipment & Supplies • Automation Solutions • Laboratory & Food Safety Equipment • Solar Energy & Energy Storage Systems • Refrigeration & Cooling Solutions • Engineering Services & Supplies • Storage & Post-harvest Solutions

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BRIEFS Commodity trading giants Roots Commodities, Rosa Grain to build US$140 million grain terminal in Egypt Two commodity trading companies have signed a contract with the Egyptian government to build an EGP 2.2 billion (US$140m) bulk grain terminal in East Port Said, at the northern end of the Suez Canal on the Mediterranean Sea. Local firm Roots Commodities and Emirati company Rosa Grain will establish the facility in partnership with the Suez Canal Economic Zone (SCZone). This dedicated terminal will be set up on an area of 267,000 square meters and will have a capacity of handling between 1.5 million tonnes (MMT) to 7.2 million tonnes (MMT) of grains per year.

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Coca-Cola partners with Angolan beverage company Refriango to locally produce Minute Maid brand ANGOLA –

Refriango, one of Angola’s leading producers and distributers of soft beverages, energy drinks and alcoholic beverages, has entered into a partnership with one of the world’s largest soft drink companies, Coca-Cola. Under the agreement, Refriango will commence local production of Coca-Cola’s fruit-based juice brand Minute Maid, coming in three flavours tropical, orange and apple. The partnership is also aimed to open new market opportunities for the Angolan company, as it is eyes export routes to Mozambique, São Tomé and Príncipe, and the Democratic Republic of Congo. The agreement will allow the company to fully utilize its installed capacity which currently stands at 27 filling lines with an annual production

capacity of about 2.5 billion litres. Present in the market for 17 years, the beverage maker recently invested US$10m in the installation of a new filling line of returnable bottles for its Tigra beer brand. The investment will enable the company to increase its filling capacity by 35%, meeting the rising demand of the beer in the country. The introduction of the returnable bottles in the market is in line with the company’s commitment to a circular economy by minimizing waste pollution in the environment.

FUNDING

Germany packaging equipment supplier KHS establishes modern regional center in Kenya

KHS, an international manufacturer of filling and packaging equipment for the beverage, food, and non-food sectors, has broken ground for the construction of state-of-theart center in Kenya. The regional hub, targeted to serve the East African community, will feature a number of training and conference rooms, offices and a large warehouse for spare parts and installation tools. It is scheduled for completion in 2022.

KENYA –

JULY/AUG 2021 | FOOD BUSINESS AFRICA

European seafood processor Sykes invests US$47.7m in Morocco to establish two processing plants MOROCCO – Sykes Seafood, British specialist in seafood processing, is seeking to invest €40 million (US$47.7m) in the establishment of two new factories in Northern Morocco over the next two years. The new facilities will join the company’s large-scale prawn peeling plant in Tangier, operated by Klaas Puul. The Netherlands-based Klaas Puul, has been operating in Morocco since 1989 and was acquired by Sykes Seafood in 2020, creating a €300m (US$358m) pan-European seafood business. Klaas Puul specializes in shrimps, prawns, and mussels while Sykes offers both saltwater and freshwater fish. Under the new investment, the first facility will be established in Tangier and have a capacity of shelling 7,000 tonnes of shrimp per year.

While the second factory will be situated at Fnideq, occupying 25,000 square meters. It will undertake the shelling, cooking and freezing of a wide range of wild and farmed shrimp. The plant will also have a complete threading, cutting and packaging facility. “This installation will allow us to produce products in the immediate vicinity of Europe, and considerably reduce shipping times. Shortening the food supply chain has been at the heart of our decision-making and our continued investment in Morocco. We consider Morocco as an essential advantage for us, offering our customers total security of supply,” said Sykes Seafood. The new investment will bring employment opportunities to Moroccans and boost the economic relations between the country and Europe. FOODBUSINESSAFRICA.COM

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SUSTAINABILITY

PepsiCo targets to replenish more water than it uses by 2030 only a critical component of our food system, it is a fundamental human right – and the lack of safe, but clean water around the world is also one of the most pressing issues facing our THE PROGRAM WILL ENABLE THE COMPANY TO REDUCE WATER USAGE BY 11 BILLION LITERS PER YEAR – A 50% REDUCTION IN THE WATER CURRENTLY USED AT PEPSICO SITES.

USA – American-based multinational food and beverage company PepsiCo has made a pledge to become “net water positive” by 2030. To achieve this goal, the maker of Pepsi and Mountain Dew soda brands aims to replenish more water than it uses in its operations. PepsiCo says it will employ “best-in-class water-use efficiency standards” covering more than 1,000 company-owned and third-party

facilities. It is hoped the program will enable the company to reduce water usage by 11 billion liters per year – a 50% reduction in the water currently used at PepsiCo sites. PepsiCo also hopes to adopt the Alliance for Water Stewardship Standard in all high-water risk areas where it operated by 2025. “Time is running out for the world to act on water. Water is not

global community today,” said Jim Andrew, chief sustainability officer at PepsiCo. The new commitment will see the beverage giant placed among the most water-efficient food and beverage industry manufacturers that operate in high-risk watersheds. The PepsiCo Foundation is also launching a $1 million programme with NGO and long-term partner WaterAid in a bid to bring safe water to families in sub-Sarahan Africa.

SUSTAINABILITY

Upfield’s plant-based spreads save 6 million metric tonnes of CO2 annually NETHERLANDS – Margarine and spread company Upfield has calculated the greenhouse gas emissions its customers have prevented over the past year by choosing its plant-based products. The total is estimated at up to six million metric tonnes of CO2 equivalent. Upfield claims it is the first company in the industry to estimate these emissions savings figures, which it calls “The Upside”. By publishing them, it hopes to draw policymakers’ attention to the environmental benefits of plantbased diets. The Netherlands-based company notes that the amount saved is double the company’s operational and supply 22

JULY/AUG 2021 | FOOD BUSINESS AFRICA

chain emissions and equivalent to emissions that would be avoided by growing 100 million tree seedlings over the period of ten years. Sally Smith, head of sustainability at Upfield, noted that the data gathered helps demonstrate that choosing just one company’s plant-based products can help consumers save emissions by the same magnitude as planting a

large forest. “We encourage policymakers and stakeholders to consider the insight from this approach and its implications for sustainable diets worldwide,” she stresses. “At Upfield, we are committed to putting climate footprint information on pack as a way to help consumers make active choices to help reduce THE AMOUNT SAVED IS EQUIVALENT TO EMISSIONS THAT WOULD BE AVOIDED BY GROWING 100M TREE SEEDLINGS OVER 10 YEARS. the carbon impact of their diets and we’d love to see other food businesses doing the same.” FOODBUSINESSAFRICA.COM

REGULATORY

Ghana gears up with one-district-one-factory initiative, invests in new agro-processing facilities

GHANA – Premium Foods Limited, supplier of blended fortified and nonfortified food products in Ghana, has cut ribbon to it new factory operating under the government’s 1-District-1Factory initiative (1D1F). Over the years, Premium Foods has been the main supplier to global organizations, including international relief organizations, and multinational food and beverage manufacturing companies across Africa, such as the

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“Feed the Future” programme, under the US Government’s Global Hunger & Food Security Initiative. The new state-of-the-art manufacturing facility has the capacity to blend over 96,000 metric tonnes annually of maize, soybean, sorghum and millet. The government of Ghana has also supported Weddi Africa Limited to open its new US$16 million tomato

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processing factory in Domfete, Bono Region. The newly built factory has a processing capacity of 40,000 metric tonnes of fresh tomatoes per annum, supported by a 500 metric ton cold room facility to store fresh tomato fruits. Further to that, the developmental initiative has inaugurated the GH¢7.3 million (US$1.2m) Savelugu rice processing factory in the Northern Region. The state-of-the art facility features modern parboiling, milling and packaging lines, with an expected production capacity of 1.5 tonnes – 2.8 tonnes of processed rice per hour. This is in addition to the expansion of the Tamanaa rice processing company, adding 250-metric ton per day of rice milling to its already existing 40 metric ton per day plant.

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INVESTMENTS

REGULATORY

Tana Africa Capital backs Kenyan meat processor QMP Group, alcoholic beverage distributor KDV

AFRICA – Tana Africa Capital, an Africa-focused investment company has made an equity investment in Kensington Distillers & Vintners, a London based alcoholic beverage manufacturing and distribution business with operations in South Africa, Kenya and Nigeria. Following the investment, the Pan-African private equity firm has clinched a minority stake in KDV, the majority owner of Truman & Orange South Africa, Monument Distillers East Africa and Monument Distillers Nigeria. Since its founding in 2014, the fastgrowing alcoholic beverage company has been engaged in the production, distribution and sale of spirits and wines, with local manufacturing operations in the three fast growing African economies.

In addition, the investment company has also backed Mauritius based holding company, Africa Protein Holdings (APH) Limited, owners of Quality Meat Packers Ltd and Anirita Poultry Farm Plc with an undisclosed amount of investment. The support is aimed at transforming APH’s Kenya based business, QMP Group, into a leading African meat processing company, operating with world-class standards, FOLLOWING THE INVESTMENT, THE PAN-AFRICAN PRIVATE EQUITY FIRM HAS CLINCHED A MINORITY STAKE IN KDV and possessing deep competitive advantages. Founded in the 1980s as a retail butchery in Nairobi, the QMP Group currently engages in procuring, farming, hatching, breeding, processing, packaging, distributing, marketing, and retailing animalsourced meats. The product offering features a wide range of meats including beef, goat, chicken, lamb, fish and related value-added snacks.

TECHNOLOGY

AgDevCo expands portfolio to develop banana industry in Mozambique MOZAMBIQUE – The UK-based social

impact investor has closed a US$3 million debt investment in Quinta da Bela Vista Limitada (QBV), an irrigated banana estate located in the Boane area in Mozambique. QBV was established in 2016 as a joint venture between Silverstreet Capital’s Silverlands I Fund and Crookes Brothers Limited and currently comprises 128ha of irrigated bananas. The company’s strategy is to expand the operation to 260ha over 24

JULY/AUG 2021 | FOOD BUSINESS AFRICA

the next two years. AgDevCo’s investment will support QBV’s expansion by providing longterm capital.

Zambia’s leading grains, snacks processor Seba Foods clinches US$4m financing to boost production

ZAMBIA – Seba Foods Zambia Limited, subsidiary of Zambiabased Two Six Zero Brands Africa has received a US$4m senior loan facility from AATIF to enable it maximize output from its recently installed processing plant. The debt is structured as a 12-month CMA facility. Seba Foods which undertakes processing and distribution of a wide range of products made from maize and soybeans, will utilize the finance to purchase raw materials from local smallholder farmers in the country. “We are pleased and humbled with AATIF’s support and investment, which believes in our vision that THE FINANCE WILL FUND PURCHASE OF RAW MATERIALS FROM LOCAL SMALLHOLDER FARMERS IN THE COUNTRY. allows us to offer reasonably priced and nutritious consumer products to Africa’s people, and at the same time, create a socially conscious business that would contribute to ending all forms of malnutrition and support sustainable agriculture,” said Gaurav Vijayvargiya – Chief Executive Officer, Seba Foods Zambia. The company’s product range include textured soy as a meat alternative, powdered/instant drinks, corn soya blend (porridge), as well as snacks – a segment the company has managed to dominate in the country. FOODBUSINESSAFRICA.COM

SUPPLIER NEWS & INNOVATIONS

NUTRITION & HEALTH

Tate & Lyle partners Kellogg’s to offer free online course on benefits of dietary fibre

LATIN AMERICA –

Tate & Lyle PLC is partnering with the Nutrition and Health Institute of Kellogg Co. (INSK) to share the latest science on dietary fibers with health clinicians, nutritionists, and food and beverage industry professionals across Mexico, Colombia, Chile and Argentina. As part of the partnership, the companies are offering an online curriculum titled “Dietary fibers: benefits that go beyond gut health.” The program will run from August 16 to December 31 and features 12, 20-minute video lessons in Spanish led by nutritionists and food scientists from different countries across Latin America. A range of fiber-related topics, including current dietary fiber recommendations and consumption in the Latin American region will be covered in the program. Additionally, participants will get exposed to the latest information on the gut health and fiber connection, including links to prebiotics, microbiota, and immunity, They will also get to learn about the benefits of fiber across childhood and throughout healthy aging; dietary fibers and body weight, glycemic response, bone, and cardiovascular health; and emerging science. Tate & Lyle says health professionals and other participants will have the flexibility to move at their own pace and prioritize the lessons most beneficial to their ongoing learning and practices.

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SUSTAINABILITY

Tetra Pak, Stora Enso partner to boost Europe’s carton recycling capacity

NEW PRODUCT

Mathews Company launches new grain dryer line

POLAND –

Food packaging and processing company Tetra Pak and Stora Enso, a manufacturer of pulp, paper, and other forest products, are investing €29.1 million (US$39.98 million) in boosting the recycling capacity of beverage cartons in Central and Eastern Europe. The investment will see the installation of a large-scale carton repulping line at Stora Enso’s Ostroleka production unit in Poland, tripling the annual recycling capacity of used beverage cartons in Poland

from 25,000 to 75,000. The increased capacity will enable the recycling of the entire volume of beverage cartons sold in the country, as well as those from neighboring countries including Hungary, THE INVESTMENT WILL SEE THE INSTALLATION OF A CARTON REPULPING LINE AT STORA ENSO’S UNIT IN POLAND Slovakia, and the Czech Republic. According to a statement from the companies, the project will ensure collected cartons are managed in an environmental manner, making full use of the materials resulting from the recycling process. Stora Enso is pumping €17 million (US$23.36 million) into the repulping line, while Tetra Pak – along with Plastigram – will invest €12.1 million (US$16.67 million) to build an additional line. Both lines will be operational by the beginning of 2023.

US — Mathews Co. (M-C), a familyowned global manufacturer of grain dryer equipment, has launched its newest grain dryer product line, the Fusion Series. The Fusion Series includes familiar features such as a welded base, Pinnacle 20|20 controls, and M-C Trax remote monitoring and control which enhance the efficiency and effectiveness of the grain drying process. The Pinnacle 20|20 is a PLCbased control system with a large customizable touchscreen that has remote connectivity for operational monitoring and control, and intuitive troubleshooting and help features. M-C Trax, on the other hand, allows users to monitor and control critical dryer functions remotely from anywhere in the world. The Fusion Series also incorporates exclusive mixed-flow features such as M-C’s exclusive SmartFlow Technology and M-C’s proprietary high-efficiency stainless steel and cast aluminum burners, to further enhance the efficiency of the grain drying process. First-year production models will be making their debut later this fall just in time for the 2021 harvest; full production is currently being planned for early 2022.

JULY/AUG 2021 | FOOD BUSINESS AFRICA

SUPPLIER NEWS & INNOVATIONS

M&A

NEW INNOVATION

Cargill, Continental Grain to acquire US poultry producer Sanderson Farms for US$4.53bn US –

Cargill and Continental Grain Company have announced that they will acquire poultry producer Sanderson Farms for US$4.53 billion in an effort to bolster their presence in the US poultry market.

Upon completion of the transaction, Cargill and Continental Grain will combine the latter’s Wayne Farms subsidiary with Sanderson Farms to form a new, privately-held US poultry company. The new entity will control about 15% of U.S. chicken production, putting it in a better position to compete with larger competitors such as Tyson Foods and Pilgrim’s Pride. Wayne Farms CEO Clint Rivers will lead the business, which will operate poultry processing plants and prepared-foods facilities across Alabama, Arkansas, Georgia, Louisiana, Mississippi, North Carolina, and Texas. Wayne Farms’ customer relationships across the foodservice sector are expected to complement Sanderson Farms’ grocery and retail relationships. “We are proud to be joining with Cargill and Continental Grain and we are confident that they will be strong stewards of the Sanderson Farms team, brand and assets going forward,” said Joe Sanderson, chairman and CEO of Sanderson Farms. 26

JULY/AUG 2021 | FOOD BUSINESS AFRICA

Arla Food Ingredient unveils new whey ingredient to support production of high protein yogurts ARGENTINA – Arla Foods Ingredients has launched a whey protein ingredient that allows manufacturers to develop spoonable and drinkable yogurts with a “significantly higher” protein content than typical products. According to a statement from the company, the newly released Nutrilac FO-7875 helps meet the growing demand for premium, high-protein yogurts in the South American market and beyond. The company said that the new whey product can be used to create a drinking yogurt with 11 percent protein and only 0.8 percent fat, whereas drinking yogurts generally range from 5 to 9 percent protein. It is also highly functional, delivering a creamy and smooth texture – even in low-fat recipes – and does not increase viscosity.

THE NEW WHEY PRODUCT CAN BE USED TO CREATE A DRINKING YOGURT WITH 11 PERCENT PROTEIN Furthermore, it does not require the addition of stabilizers, thus allowing cleaner labels. Arla Foods Ingredients expects the global market for high-protein yogurt products to grow at a CAGR of over 8 percent to 2030. Future markets on the other hands expected the market for spoonful high protein yogurt which was valued at US$26,612.3 Mn in 2020 to grow at a CAGR of 8.2% to reach US$58,436.5 Mn by 2030. Higher demand for protein-rich foods comes as sports nutrition moves into the mainstream with traditionally indulgent categories, such as ice cream, are taking on highprotein claims to create better-foryou positionings.

RESEARCH & DEVELOPMENT

Fuji Oil joins Europe’s plantbased protein revolution with launch of a new R&D center NETHERLANDS –

Japanese food ingredients company Fuji Oil Holdings, has established its fourth R&D center in Netherlands to enable it take part in the plant-based revolution that is currently taking place in Europe. According to a statement from the company, the new center is based on the Wageningen Campus at the heart

of the Dutch Food Valley where it will be able to have easy access to the technical trends and innovations that are impacting global food systems. Dr. Liz Kamei, currently director of open innovation and external partnerships at Fuji Europe and Africa, has been appointed as the head of the new center. Fuji Oil’s foray into Europe’s plantbased sector is happening at a time when the market is experiencing explosive growth mainly driven by a growing trend toward vegan diets and incorporating plant proteins in processed foods. According to the market research firm, the European plant protein market is projected to grow at a CAGR of 6.66% during the forecast period, 2021-2026 to reach US$3.8 billion by 2026. Following the launch of the R&D center, experts at Fuji Oil’s Global Innovation Center Europe (GICE) will work with partners from academia and industry to identify, evaluate and speed up the deployment of new technologies that align with the group’s ambitions to contribute to resolving social issues. FOODBUSINESSAFRICA.COM

BEVERAGES

COFFEE & TEA

M&A

Tate & Lyle sells controlling stake in primary products business to KPS Capital Partners for US$1.7B US – Tate & Lyle PLC, a leading global provider of food and

beverage ingredients and solutions, is selling a controlling stake in its Primary Products business in North America and Latin America to KPS Capital Partners. The Primary Products Business is a leading provider of nutritive sweeteners, industrial starches, acidulants, and other corn-derived products in North America and Brazil. The Company produces corn-derived products for a diverse set of end-uses including carbonated beverages, confectionary products, packaging applications, and animal feed, among others. With approximately 1,700 employees across six

manufacturing facilities in the United States and Brazil, the Primary Products Business generates annual revenue of approximately US$2.3 billion. According to a statement from KPS, the sale of the primary products business for an enterprise value of US$1.7 billion also includes interests in the Almidones THE PRIMARY PRODUCTS BUSINESS GENERATES ANNUAL REVENUE OF APPROXIMATELY US$2.3 BILLION. Mexicanos S.A de C.V and DuPont Tate & Lyle Bio-Products Company, LLC joint ventures. Following the sale, the Primary Products business will be integrated into a new company where KPS and Tate & Lyle, through affiliates, will each own approximately 50% stake with KPS having Board of Directors and operational control. Completion of the transaction is expected in the first quarter of 2022 and is subject to customary closing conditions and approvals.

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The Beverages, Coffee & Tea Expo showcases packaged and processed beverage, coffee, tea and other hot beverage products to a local, regional and international audience, including: Beer • Wines • Spirits • Alcohol Free Beverages • Ciders • Cocktails • Coffee • Tea • Chocolate Drinks • Fruit Juices • Packaged Water • Cordials • Blends Packaged coffee, tea, cocoa and other hot beverage products • Ready-to-drink coffee, tea, cocoa and other hot beverages • Wellness and other plant-based hot and cold drinks • Medicinal and functional drinks • Equipment and solutions for preparing, cooking and serving coffee, tea, cocoa and other hot beverages • Ingredients for preparing coffee,tea and other hot beverage products

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INNOVATION

DSM unveils new phage-robust culture rotations to help manufacturers overcome spoilage issues in cheese

NETHERLANDS – Dutch multinational health and nutrition company DSM has expanded its Dairy Safe cheese biopreservation portfolio with a new range of phage-robust culture rotations. The company notes that the new range comprised of four new culture rotations offers a more robust system that effectively manages bacteriophages (phages) and overcomes spoilage issues in cheese. Insufficient management of

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phages can lead to fermentation delays and production slow-down, which can contribute to increased food loss and have a detrimental impact on cheese flavour, yield, and texture. At the same time, demand for great-tasting, sustainable and natural cheese is on the rise, with 34 percent of consumers choosing cheese products that contain fewer additives or preservatives, according to DSM.

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address these challenges by providing a robust culture rotation system, ensuring reliable and consistent cheese production, and guaranteeing optimal phage management.

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34% OF CONSUMERS CHOOSING CHEESE PRODUCTS THAT CONTAIN FEWER ADDITIVES OR PRESERVATIVES

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This puts manufacturers under immense pressure to protect against spoilage in cheese and maintain flawless production to avoid expensive defects. Achieving this feat is however not easy and cheese manufacturers are reported to have challenges in producing high-quality products that meet these diverse needs of consumers. DSM’s Dairy Safe cultures help

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JULY/AUG 2021 | FOOD BUSINESS AFRICA MAY/JUNE 2021 | FOOD BUSINESS AFRICA

EXECUTIVE INTERVIEW: ANDREW CHINTALA

With a new President, the milling industry in Zambia is looking for policies that can promote regional trade to harness the country’s growing harvests of key commodities FBA: Andrew, welcome to this edition of Food Business Africa Connect, where we talk to various leaders across the Africa and world on the opportunities, challenges, and the trends in our industry ANDREW: The Millers Association of Zambia is a registered trade organisation that was established to promote the interest of the milling industry in Zambia by providing a platform and creating linkages between the sector players within the country and outside the country. We represent over 80 big scale or commercial millers in Zambia. FBA: We are talking a few days after a very critical elections period and with the new President in place in Zambia. What is the kind of impact do you think the new leader will have on the milling industry in Zambia? What is association looking forward to?

Zambia's grains industry must tap potential as crop production rises ANDREW CHINTALA – President, Millers Association Of Zambia 30

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ANDREW: We have already sent in congratulations to the new President, as well as the Vice President. We are quite excited, and we are looking forward to his Cabinet and more so to the promises that were made during the campaign trail. The new administration has been well received not only our Association, but other stakeholders as well across the country - individuals, corporates, as well as organization’s such as ours. You know, the President is a farmer, and he is a very proud farmer. Given an opportunity he has always introduced himself and identified himself to be a farmer - so he’s a person who understands agriculture, both livestock as well as crop agriculture. We are quite excited because apart from that, he is an accomplished businessman who also believes in trade and understands and respects trade protocols and so forth. FOODBUSINESSAFRICA.COM

We are looking forward to the policies that his administration is going to introduce in the food value chain, because time and again, we have continuously criticized the inconsistences in the previous government, especially regarding its border policies on grain exports. These policies affected the growth of the industry, making most of the players get frustrated. We were dealing in an environment where certain policies were very unpredictable, making it difficult to make informed decisions because you did not know whether if you went out in the market and bought some grains, if you would be allowed to add value and be able to export. We are hoping that this new government will be able to respect and to follow through what they have put on the table – the time the new President was declared winner, we saw the exchange rate of the Kwacha to the US$ strengthen within 24 hours, which portrays that he has won the confidence from the investors and those who would like to do business with Zambian business entities. We are ready and willing to align ourselves with the policies of the new government. As far as our industry and other food industries are concerned, we are quite hopeful that he is bringing a message of hope to the milling industry and to the food value chain players. We also expect the government to give us space to operate as an industry, with less or absolutely no interference from the government, but providing direction and guidance in as far as the industry is concerned. FBA: Zambia is a large country with lots of opportunity in agriculture. How could the country take advantage of this huge opportunity? ANDREW: We have always said that Zambia is a landlocked FOODBUSINESSAFRICA.COM

country, but I believe that it may be a landlocked country but is actually a land-linked country - with various countries we can trade with across our borders. The question is how to position ourselves and then I am quite excited to see also how this Africa free trade area (AfCFTA) agreement protocols can be one vehicle that will provide linkages to the market for some of the produce that we produce in Zambia. AS MILLERS, WE ANTICIPATED 3.8 MILLION METRIC TONNES OF MAIZE TO BE HARVESTED IN ZAMBIA THIS SEASON, WHILE AS WE ONLY REQUIRE ONLY 1.8 MILLION TONNES FOR CONSUMPTION FOR THE YEAR – SO WE HAVE AROUND 2 MILLION TRADABLE SURPLUS CROPS FOR EXPORT. This deal must encourage pan-African trade with minimum or no restrictions and create a platform for us to supply and trade with other African countries – including in such countries such as Sudan, Kenya and South Africa and our immediate neighbours - the only thing is to deal first with are the trade barriers that exist I have always made an example of Angola. When I visited, we had discussions with other captains of the industry - it was quite glorifying to see how much money they spend on food imports from South American countries such as from Brazil and other countries! Zambia has got the capacity to produce food at primary level such as maize, sorghum, millet, fruits etc. and we have got a very good compared to other countries in terms of the climate. We can do better; we can produce more that JULY/AUG 2021 | FOOD BUSINESS AFRICA

EXECUTIVE INTERVIEW: ANDREW CHINTALA

we can supply to the entire region. As a country, Zambia has the potential - we have the land, water and adequate human resource. We have got what it takes to produce more crops than just the traditional maize grain - soya bean, cassava and more What has hampered the growth and our ability to maximize our production capacity in Zambia has been the restrictions in terms of the policy framework. I am hoping that AfCFTA will also be able to address such issues to promote regional trade within Africa. However, it is also glorifying to note that we have made reasonable progress in the last 2 years in terms of increasing the cassava production at primary level. We are producing a lot of cassava, which now for us in the food value chain industry are trying to think what else are we be able to produce from the cassava apart from just the flour – such as opportunities to blend cassava with the wheat or maize. FBA: We are looking at the tail end of the season - give us a review of the season just past. ANDREW: The crop’s marketing season is almost ending, but the market delayed starting, owing to the weather patterns that were prevailing in the last three months or so. It was very cold; we have never experienced this kind of weather in a long time in Zambia. Commodities such as maize grain and soyabeans delayed coming to the market because moisture content was quite high. We saw the peak towards the end of July in terms of the maize and soya supplies. ZAMBIA HAS THE CAPACITY TO PRODUCE UP TO 6 MILLION, OR EVEN 8 MILLION TONNES OF MAIZE As millers, we anticipated 3.8 million metric tonnes of maize to be harvested in Zambia this season, while as we only require only 1.8 million tonnes for consumption for the year – so we have around 2 million tradable surplus crops for export. This is a very exciting yield, but we are looking forward to seeing what the new government will bring in terms of what policy framework will be given to guide how we are going to trade with these commodities such as maize, soyabean, rice, cassava and sorghum. In terms of the soyabeans, we equally have a very fair and a very good crop. We have seen that the byproducts of soyabean also are dropping and stabilizing, because the supply is surpassing the demand out there. The good harvests give us the opportunity to also think of diversifying and not only just to stick to the traditional milling, while Zambia should start positioning itself to feed other countries that have rising demand for commodities such as maize and its products, soyabeans and so forth. 32

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We must position ourselves in as far as meeting the demand, not only on the domestic market, but the regional demand for some of these commodities that we produce in abundance in the country. FBA: DRC has traditionally been a huge market for Zambia. What is the possibility for more trade with DRC this year, considering the huge surplus? ANDREW: Zambia has the capacity to produce up to 6 million, or even 8 million tonnes of maize production like per annum, but obviously restrictions at the border has curtailed our ambition. In terms of export markets, DRC is key for Zambia. However, in terms of the outlook within the region, we are also aware that DRC this time around also increased its area of production for the maize grain, which is quite interesting. To some extent, this is a bit worrying for us because this is our traditional market and they are now also producing their own grains! I must say that they did very well, coming from the previous season. I think, looking at the cost of production both at primary and commercial levels, Zambia is well positioned to give DRC quiet a fair competition in terms of cost of doing business and producing some of these crops. What is quite interesting is just when our President was declared, we saw the Kwacha strengthen and now that trade between FOODBUSINESSAFRICA.COM

can take care of some of the logistics challenges that was faced last time we tried to access that market. One way is for the grain traders to approach the Kenyan government to reduce duties and granting them waiver if they were to import things such as maizemeal, maize grains, soyabeans etc. from Zambia. We should work together to create an enabling trading environment between the two countries to improve trade flow in the region. There is nothing that stops us from supplying that market, because there is always a deficit in Kenya, but we also do not fully understand the way the market in Kenya operates. With DRC now increasing their production, we must start looking for other alternatives such as Kenya. I must admit that we haven’t as the captains of the industry, taken a keen interest in growing that market for our produce from Zambia. FBA: What are the opportunities other grains in Zambia?

ourselves DRC and any other exporting market has been dollarized, we saw the price on the other side was almost was at the par with the domestic price. There is still some potential and the market for us to push close to 60-70% of the surplus maize to DRC because they consume more of the maize products. Across the SADC region, we have also seen good crop harvests, for example, South Africa has produced a bumper harvest and it is also targeting the DRC market - so we have good competition. FBA: Looking at the other markets beyond DRC, could there be an opportunity around the East African side of Africa? ANDREW: Well, the possibility is there, and I must also mention also something very important. A few years back, we had signed a Memorandum of Understanding (MoU) between the Millers Association of Zambia and stakeholders in Kenya but generally, DRC has always been an easy market for us. Most of the exporters, traders and millers are more used to this market and understand it more but we are very much aware, and we have received a few enquiries from Kenya for maizemeal as well as the maize. But we should pull ourselves together with our counterparts in Kenya to begin to talk and see how best we FOODBUSINESSAFRICA.COM

ANDREW: For soyabeans it’s quite very interesting to note that the number of soyabean crushers have increased over the last few years. There is an increase in demand within the country and export demand for cooking oil, soya cake and other byproducts of the soyabeans, which has seen more players coming into the soyabean crushing sector, which is very good, and I must say that even the way they are positioning themselves, they are moving closer to the where the production of the soyabean, as our farmers face big challenges with accessing the market. There is also an increase in terms of animal/stock feed production in the country. We are seeing the industry positioning itself to supply the regional market with stock feed and soya products. We have also seen an increase in cassava to produce it can see that people are trying to explore and find other alternative users for the cassava - in the next season we should be able to do much more cassava production, so as the milling industry we are looking at ways to start blending the cassava with maize. I think over the years, the concentration has been largely about commercial and economic value of the commodity, but we have overlooked the nutritional value of some of the commodity. We also have potential to increase sorghum and millet production and consumption in the country. INTERVIEWER: What are the possible interventions by the Food Reserve Agency (FRA) this season? ANDREW: The vibes on the market are quite interesting. This season the FRA is paying the highest prices in the country! They have offered a very attractive price to small scale farmers, which should be quite commendable. They have also increased the satellite depots reaching out into the country to serve farmers. FBA

JULY/AUG 2021 | FOOD BUSINESS AFRICA

TheNest AFRICA

AT THE NEST AFRICA OUR AIM IS TO CONNECT START-UPS WITH BIG CORPORATES & FUNDERS 34

JULY/AUG 2021 | FOOD BUSINESS AFRICA

Start-ups and young businesses in sub-Saharan Africa face a myriad of challenges, including lack of access to technology, expertise and networks to grow. At The Nest Africa, we are creating a collaborative facility with new product development labs, production and packaging kitchens and office space for use by start-ups and young companies to facilitate their innovations and growth towards becoming the next big thing. AND WE BELIEVE THAT CONNECTING THEM TO BIG CORPORATES AND FUNDERS IS KEY TO THEIR SUCCESS Visit the website and sign up to partner with us today

www.thenest.fwafrica.net FOODBUSINESSAFRICA.COM

SPONSORED BY THE NEST AFRICA

COMPANY PROFILE

SAGE VALLEY NANCY KAFWIMBI & ZITA KAFWIMBI - FOUNDERS FOODBUSINESSAFRICA.COM

JULY/AUG 2021 | FOOD BUSINESS AFRICA

FOOD STARTUPS AFRICA: SAGE VALLEY

Sage Valley: Bringing some zest into Zambia’s kitchens Sage Valley, a spice and paste brand, sprouted out of Zambia in 2019. The Food Business Africa team had a one-on-one conversation with Ms. Zita Kafwimbi, the co-founder of the agro-processing start-up to gain insights pertaining the business and their journey so far.

By Catherine Wanjiku

or generations humans have perfected culinary art, courtesy of spices, that not only add flavour and aroma but preserve foods and have a tone of medicinal value. Yes, I’m talking about spices, which during the ancient and medieval times were of great value just like gold and other precious stones. Still to date the spice trade is booming across the globe propelled by increasing demand for authentic cuisines and the growing fondness towards enjoying various kinds of flavours in foods and beverages. Taking note of this trend among other factors, Sage Valley commenced operations about two years ago birthed out of the love for spices that Ms. Zita Kafwimbi, the co-founder of the company shared with her sister and business partner, Ms. Nancy Kafwimbi, of turning basic foods into tantalizing and scrumptious meals by just adding spices and herbs. However, the push to venture into the business came when the keen entrepreneurs took note of the fact that the condiment aisles in most retail outlets in the country were dominated by imported brands accounting for nearly 90% of the market share. “That rang a bell for us to consider the path of entrepreneurship that we decided to take on and also given the fact that most people want to identify with something ethnic and local. For us that is something that stood out and we decided to fill the gap,” said Zita. The brand was established under their already formed company Evnoia Supply and General Trading Limited. Prior to setting the turbines rolling, the duo undertook extensive research to determine whether the business idea was viable, by first doing a background check on the availability of raw materials. Luckily, they crossed paths with some spice and herbaceous plant farmers in the country and that gave them the impetus to channel investments in the idea. The one or two raw materials that they found were hard to be sourced locally, they opted to import from other countries.

SPOILT FOR CHOICE WITH UNIQUE BLENDS Seeming like taking a page from the likes of Jeff Bezos who founded Amazon in his garage, and Mark Zuckerberg who created Facebook in his Harvard dorm room, Zita and her partner first commenced their operations at their home kitchen for about a year. Later they moved to a smaller facility in the country’s capital Lusaka, where they undertook the processing, 36

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packaging and dispatch operations, pushing about 30,000 units of products per month. With the drive of becoming a household name, Sage Valley made a bold statement from the onset by availing a wide range of products. Under its spice line the company boasts of over 20 products coming in powder, granulated or crushed form. These include garlic, black pepper, parsley, cinnamon, ginger, paprika, turmeric, curry, rosemary, mixed herbs, Himalayan salt and coarse salt. The spices also include food specific additives such as steak & chops, barbeque, chips, chicken, rice and fish, in addition to exotic offerings such as Italian Herbs and the Portuguese Chicken Spice. Sage Valley has further set itself apart from its peers in the market and heightened its competitive edge with its paste line comprising of garlic, ginger, curry, chilli, garlic & herbs, garlic & ginger and garlic & chilli with a longer shelf-life under refrigeration. “We try to have a balance of the whole spectrum of the culinary world so that everyone can have a chance to use our spices,” notes Zita. Other than promoting indulgence, Sage Valley is also championing healthy eating as its products FOODBUSINESSAFRICA.COM

have no added artificial colorants or flavours and contain 50% less salt. “After processing we package the spices in 100 grams glass bottles and 100 grams bio-degradable refill pouches while the pastes come in reseal-able glass containers, which are all labelled with our brand name ready for market,” she elaborated. FOOD SAFETY AND SUSTAINABILITY COMPLIANT Zita notes that the choice of their packaging materials deliberately aimed at promoting reuse, thus minimizing pollution. Once a customer buys the glass bottled spice, following subsequent purchases of the pouches can then be emptied into the former package. Also, the pouches can be used within the shelf-life of the product as they feature re-closable, zip locks. By having such packaging options, Sage Valley is preventing tonnes of packaging containers from reaching the landfills and water bodies. For the pouches, Zita revealed that they are working towards recycling the plastic packages, harkening to the warning by UN Environment that by 2050 there will be about 12 billion tons of plastic litter in landfills and the natural environment globally, if current consumption patterns and waste management practices do not improve. Currently the world produces more than 400 million tons of plastics every year of which only 9 per cent is recycled. The agro-processor’s focus is not just to avail innovative products with eye catching branding, as the start-up has implemented robust food safety management systems in its operations with its Zambia Bureau of Standards (ZABS) certification acting as proof. “We are yet to be certified Halaal compliant by the Zambian Halaal Association to indicate that our production is compliant with the Islamic law,” said Zita. FAST PENETRATION IN THE LOCAL MARKET With the ZABS mark of quality embodied on the product, Sage Valley’s goods have been able to fast penetrate the local market, FOODBUSINESSAFRICA.COM

reaching far and wide. The company has partnered with the major wholesalers in the country who act as points of contact to the small retailers who operate shops within neighbourhoods. Further to that, the pastes and spices prominently feature in some of the leading supermarket chain stores in the country hat such as Shoprite, Pick n Pay, Zambeef stores and Melissa. Zita excitedly noted that the company’s partnership with Shoprite, the leading retailer in Africa was and is still one of the biggest achievements they have ever attained. “That was the dream, as it was one of our main goals to achieve when we first set out. The day that we got our first order, we threw a party as we had finally made it!” Clearly, that was no mean fit achievement as it demonstrated a huge shift by Sage Valley since it commenced operations, from supplying only one mini-supermarket to fashioning 42 Shoprite stores across the country, translating to rise in sales volume.

KEY NUMBERS

US$13,000 THE AMOUNT IN DOLLARS THAT THE FIRM RECEIVED FROM THE EMPRESS FUND

Being a company operating in the digital era, the start-up has leveraged different social media platforms to raise awareness about its products and divulge any important information pertaining to the brand which may include new release, market presence, promotions, among others. “The response in the market has been overwhelmingly positive, obviously because our blends are very unique and different from what people are used to, which gives us encouragement to continue,” Zita says. JULY/AUG 2021 | FOOD BUSINESS AFRICA

FOOD STARTUPS AFRICA: SAGE VALLEY

COMPANY PROFILE

Sector: Spices Country: Zambia Main Contact: Zita Kafwimbi Email Address: sagevellyzm@ gmail.com Telephone: +260 973629434 Address: Zambia

ACCESS TO FINANCING STILL A PAIN-STAKING PROCESS Still being a company at its infancy stage and having products displayed at leading retail outlets, one would deem Sage Valley as an overnight success. However, that is not the case as Zita and Nancy have had their fair share of curve balls thrown at them. One of the challenges that the company recently faced was the disrupted access to raw materials such as packaging that they source from South Africa, a region that has experienced multiple lockdowns, border closures and movement restrictions. “The goods that managed to come in the country were still taking longer to reach us, which meant there was delay and irregularity in supply of the finished products to the markets, overall having a negative impact on our bottom-line performance,” stated Zita. Aside from that, the company has been facing hurdles in access to finance. Zita notes that, “Because we are still a growing company supplying large chain stores, we find ourselves needing more short-term finance such as order financing, but most financial institutions do not offer such and the individuals that do, have ridiculous interest rates that do not help growing businesses. We have yet to eliminate this particular challenge but there are some financial institutions that are slowly starting to tailor products that growing businesses can access.” GLIMMER OF HOPE Mid last 2020, the start-up clinched a K250, 000 (US$13,000) revolving working capital facility from the Empress Fund, managed by Africa Trust Group (ATG) based in Cape Town, South Africa. The Empress Fund was established by a syndicate group of high-net-worth individuals from across the African continent and diaspora, to invest in the growth of women-owned businesses in SADC. The funding came at an opportune time as the COVID-19 pandemic had just hit and the company had got listed in several Shoprite stores. The financing was used for the purchase of more machinery and extra raw material stocks needed to meet the rising demand. Other than getting financial backing, the brand has been celebrated for its exceptional performance in the market. Sage Valley received its first award in 2020 from the Nkonka Women in Agro Business in conjunction with Stanbic Bank, for the upcoming value addition business. This was followed by being crowned the best value addition enterprise in March 2021 at the Zambia

JULY/AUG 2021 | FOOD BUSINESS AFRICA

LOOKING INTO THE FUTURE, THE COMPANY IS TARGETING TO ESTABLISH A STATE-OF-ART PROCESSING FACILITY, WHICH WILL ENSURE ITS PROCESSING IS UNDERTAKEN EFFICIENTLY.

Small Scale Farmers Agriprenuership awards. In a bid to continue having a positive impact in the society, Sage Valley is planning to launch an out-grower scheme to work with women cooperatives and foster local production of the different types of herbs as some of them are not readily available, such as black pepper. “The project will educate local women on how to diversify from growing local crops such as groundnuts and maize to adding herbs and spices as there will be a market to offtake their harvests and sell them at market value to improve their lives,” notes Zita. This will further expand the number of farmers the company currently works with, which stands at 15 small-holder producers. It will also reduce its cost of production by making the products readily available SETTING EYES ON THE FUTURE Looking into the future, the company is targeting to establish a state-of-art processing facility, which will ensure its processing is undertaken efficiently and effectively. This is in line with its quest of entering the export market, starting with the SADC region and hopefully the rest of the continent, riding on the newly formed African Continental Free Trade Area (AfCFTA), representing 1.2 billion consumers. “I think the future is really bright for us, there is still a lot of market that we can achieve both locally and internationally. Global seasoning and spices market is projected to grow at a CAGR of 4.7% in the next 5 years with the trend of incorporating spices into ready to eat and ready to drink beverages. For that reason we plan to position ourselves to be able to offer our products to similar innovations,” states Zita. The growth of the company will also mean more contribution to the economy, such as creation of more job opportunities, an addition to its current team of 7 permanent employees and 10 to 15 casual workers. Looking at the business strategy of Sage Valley, the brand is set to spice up the food experience with its premium quality products across the region. FBA

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COMPANY PROFILE

SENDELET FOODS FOODBUSINESSAFRICA.COM

JULY/AUG 2021 | FOOD BUSINESS AFRICA

FOOD STARTUPS AFRICA: SENDELET FOODS

Sendelet Foods: Refreshing Ethiopians with Omango real fruit juice Part of the Ethiopian diversified company Risiq Group, Sendelet Foods, started fresh juice manufacturing in early 2020 when the Covid-19 was just beginning to become a major emergency. The Food Business Africa team had a discussion with Abdulfetah Khalid, the Managing Director of the company on the opportunity for juice products in the country and future prospects. By Paul Ongeto

frica is a resilient continent. Every day, its people deal with life-threatening diseases, conflicts, civil wars, terrorist attacks, and natural disasters. Somehow, against all these odds, Africans still manage to not only survive but thrive. The pandemic, as terrifying as it was, was just another threat they had to overcome. As economies shut down in the rest of the globe, Africa was focusing on a way to feed its people. In our past edition we highlighted how two food businesses bravely launched in the middle of a pandemic.

A 100M+ PEOPLE OPPORTUNITY To be established in the food manufacturing sector in Africa takes years of considerable planning and investment before the first product hits the market. For Sendelet Foods, the journey 40

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to become one of Ethiopia’s leading fruit juice processors began in 2018, the year when Ethiopia ushered in a new, more progressive government, under the leadership of Prime Minister Abiy Ahmed. With high optimism in the air, a group of very close young close family entrepreneurs conceived the idea of starting a juice processing company. Being home to over 112 million and having an installed juice processing capacity of just 600,000 bottles a day, Ethiopia had a vastly untapped potential. The entrepreneurs having already founded the Risiq Group back in 2012 were already active in Ethiopia’s automotive dealership, import-export, manufacturing and construction sectors, knew when an opportunity presented itself, and this was one they were not willing to let go.

FOODBUSINESSAFRICA.COM

BENCHMARKING TO START OFF Venturing into food manufacturing, the Risiq brothers quickly discovered how an uphill task it would be to set up a juice processing plant in Ethiopia. Abdulfetah Khalid, the Managing Director of both Risiq Group and Sendelet Foods took us on a journey, back to when the idea started, and the ups and downs involved in setting up the facility in one of Africa’s last frontiers. Before starting out, benchmarking was necessary, to know how the best in the industry do it to avoid making obvious mistakes. The benchmarking journey took Mr. Khalid and his team to Kenya and Tanzania, where companies like Kevian and Sayona Fruit were doing an exceptional job in juice processing. Armed with the knowledge from overseas, the Risiq Group team was confident about its readiness to replicate the model back at home. After setting up, Mr. Khalid told us they quickly found out that unlike other countries in the region, Ethiopia did not have an established supply chain for key raw materials such as puree and sugar, which are necessary for juice processing. To solve this problem, the company thought of starting its own puree processing plant but had to abandon the idea after discovering Ethiopia’s fruit production was inadequate when compared to demand. Additionally, the mango varieties in the country could not be used in puree production as they did not meet the required quality threshold. Faced with this enormous set back, Sendelet Foods now had no option but to import its raw materials from Kenya. Importing seems like the silver bullet to solve the raw material set back. Getting materials from overseas however required that the firm had to have easy access to foreign exchange, which is not the case in Ethiopia. “If you ask anyone in manufacturing, they will tell you access to foreign currency is a challenge,” Mr. Khalid says adding that in Ethiopia, it takes 9 months to 1 year to get hold of foreign currency necessary for crossborder transactions. The Sendelet MD agrees that this situation makes it FOODBUSINESSAFRICA.COM

KEY NUMBERS

140,000

AMOUNT IN BOTTLES THAT SENDELET HAS CAPACITY TO PRODUCE IN A DAY

difficult for the company to bring its raw materials into the country. How then were you able to kickstart manufacturing given all the bureaucracies involved in getting hold of foreign currency, I ask. Having been in the import business as Risiq Group, Mr. Khalid revealed that through the use of a mixture of methods including holding oversees accounts and buying dollars from exporters, the company has been able to manage the foreign exchange crisis. Sendelet realized it is not just the raw materials that needed importing - skilled labor too was in short supply. Having

little to no manufacturing footprint when it comes to juice processing, it was only normal for a country like Ethiopia to lack people experienced in this field. The team once again went fishing for professionals in neighbouring countries. Khalid confesses that these set of people were key in helping the company start the manufacturing processing and in building up local capacity. ENTERING THE MARKET AT THE HEIGHT OF THE PANDEMIC Developing the necessary capacity to start production took a significant amount of time, but the company was finally ready to launch to market in 2020, almost 2 years after the idea was started and right into a raging pandemic. Sendelet Foods, being part of the larger Risiq Group, was however not venturing into the world of many unknown. Mr. Khalid reveals to us that he and his team at Risiq Group knew the Ethiopian market well, having a previous

JULY/AUG 2021 | FOOD BUSINESS AFRICA

FOOD STARTUPS AFRICA: SENDELET FOODS

COMPANY PROFILE

Sector: Soft Beverages Country: Ethiopia Main Contact: Abdulfetah Khalid Website: www. risiqbs.com Email Address: info@ sendeletfoods.com Telephone: +251911223871 Address: Piassa Khelifa business center, office no 1015 Addis Ababa, Ethiopia

background as a trading company, which gave them an easy time in bringing its products to the market. “We had been acting as if were present in the market for a while,” Mr. Khalid said describing their first market experience. He further notes that Risiq Group being present in the food and beverage scene since 2016 as a supplier of PET preforms to water bottling companies also gave them a good understanding of the beverage ecosystem in Ethiopia. Even with an admirable prior experience, Sendelet Foods was still impacted by the pandemic. Khalid notes a significant number of Ethiopians lost their incomes when the pandemic got grip of the country and this depressed the purchasing power of most households. Although demand did not pick up as expected, Sendelet had gone out of its way to produce fresh mango juice that Ethiopians couldn’t resist, bad economy notwithstanding. Trading as Omango juice, the product easily became popular among Ethiopians, helping drive the company’s market share to above 25% in a period of less than a year. Khalid says that the quality of their juice and an effective distribution channel was key in this market success, helping the company maintain sales and escape the pandemic relatively unscathed when compared to other subsidiaries in the Risiq Group. BRINGING JUICE TO MORE ETHIOPIANS With an installed juice processing capacity of 140,000 bottles per day, the firm has already done well for itself given the challenges it had to overcome when setting up. Khalid however notes that the Ethiopian market is largely underserved. Citing data from Euromonitor, Khalid noted that the Horn of Africa country has an installed capacity of 600,000 juice bottles per day against a demand of approximately 1 million bottles per day. To meet this demand, Sendelet is in the process of setting up and commissioning a new pouch filling line with capacity to fill 120,000 pouches per day. In addition to mango and apple juices, the pouch line will also package mixed fruit juices that the company plans to soon launch in Ethiopia, all in an effort to provide more variety for Ethiopian consumers. Khalid reveals that the pouch filling line would have already been commissioned were it not for the Covid-19 supply chain crisis that affected delivery times. In addition, the company plans to expand its existing PET capacity to about 280,000 bottles per day to meet demand. “We

JULY/AUG 2021 | FOOD BUSINESS AFRICA

already secured the finance, and we are in the final stage of sourcing the machine. We hope the new expansion plant will be ready by mid2022,” Khalid said. The new expansion plant will have auxiliary units that will solve the company’s raw materials challenges, such as PET injection molding machines for preforms and shrink-wrap machines, he added. BIG PLANS FOR THE FUTURE Sendelet is taking its vision to become a leader in the Ethiopia’s juice industry seriously and is investing heavily in its future. The company is for instance taking an active role in expanding Ethiopia’s fruit production capacity to guarantee future local sourcing of fruits for its juice production. It has already set up a nursery to supply farmers with seedlings that produce mangoes of the desired quality. The company has also engaged micro-finance agencies to provide financial support to farmers desiring to embark on commercial production of mangoes. UNSURE OF WHEN ETHIOPIA’S FOREIGN EXCHANGE SHORTAGE WILL END, SENDELET IS ALSO LOOKING TO EXPORT ITS PRODUCTS TO COUNTRIES IN THE EAST AFRICAN REGION TO BOOST ITS FOREIGN EXCHANGE RESERVES.

As local capacity builds, the company plans to build its own puree processing line to serve its juice manufacturing line. In future, there are also plans to install a carton packaging line because juices in laminated card boxes have a more premium feel and a better sustainability profile. The company also has plans to manufacture fruit juices that do not use stabilizers and little to no added sugar. Unsure of when Ethiopia’s foreign exchange shortage will end, Sendelet is also looking to export its products to countries in the East African region to boost its foreign exchange reserves. Khalid revealed that the company has already identified South Sudan, Djibouti, and Somalia as some countries with potential for its juices. Most importantly, Khalid said the company plans to grow in multiple locations in Ethiopia so that many Ethiopians can have a taste of the fresh, crisp, and refreshing O-mango juice. FBA

FOODBUSINESSAFRICA.COM

Bakhresa Group takes aim at a bigger piece of Africa FOODBUSINESSAFRICA.COM

JULY/AUG 2021 | FOOD BUSINESS AFRICA

COMPANY HIGHLIGHT: BAKHRESA GROUP

By Catherine Wanjiku

Bakhresa Group is one of the most pan-African food industry operators with facilities in seven countries

ot many businesses can boast of having brands that are household names, resonating with consumers of all ages and different social walks of life. Deemed as one of Africa’s success stories, Bakhresa Group, a diversified industrial conglomerate headquartered in Tanzania, is one such company. A stroll through the bustling markets of Dar es Salaam feels like walking through an Azam corporate display case, the leading brand of Bakhresa Group. Young men pedal tricycles mounted with Azam-branded refrigerators, from which they sell Azam ice cream. Shop fronts display the wide range of Azam products: milk, flour, rice, bread, snacks, water and other soft drinks, while Bakhresa trucks transverse between depots and retail outlets transporting finished goods to the market. This was not always the case for the current multimilliondollar business empire that was established by the wellknown industrialist, Said Salim Bakhresa. Beginning in

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the mid-seventies as a small family-run restaurant in the port of Dar es Salaam, today it is a large entity, which has expanded its operations both vertically and geographically. Bakhresa Group's activities now cover the food and beverage sector, packaging, logistics, marine passenger services, petroleum, and entertainment. The company has further spread its wings beyond Tanzania and is now doing business in Uganda, Rwanda, Burundi, Malawi, Mozambique, Zimbabwe and South Africa. The company also undertakes export of its goods across sub-Saharan African countries and overseas. FOOD INDUSTRY BEHEMOTH The genesis of the company’s food and beverage operations began in 1983 with the formation of Said Salim Bakhresa & Co Ltd (SSB), the flag-ship company of the Group. The founder of the company leveraged on the privatization program from the Presidential Parastatal Sector Reform Commission of Tanzania to acquire wheat, FOODBUSINESSAFRICA.COM

AZAM FRUIT JUICE PROCESSING DIVISION HAS THE CAPACITY TO PROCESS 350 TONNES OF FRUITS AND VEGETABLES DAILY AND STORES THE PULP/JUICES/ CONCENTRATES IN 210 LITRES ASEPTIC BAGS. rice and maize mills, which enabled him to build his empire in no time. According to the company, as per 2015, SSB had combined wheat milling capacity of 2,500 tons per day and storage capacity of 160,000 tons which was further expanded to 220,000 tons. Meanwhile in the Tanzanian archipelago of Zanzibar, the flour miller runs the Zanzibar Milling Corporation Limited with a total milling capacity of 170 tons of wheat per day. In 2020, the company revealed plans of expanding its total wheat milling capacity to 3,500 tons per day. It also has a maize mill of 100 tons per day and a rice mill of 50 tons per day capacity. Products from all its mills include wheat flours, wheat bran pallets, semolina, maize flour, maize bran and rice. Situated in the hot and humid environs of the port city of Dar es Salaam, Bakhresa formed another subsidiary, Bakhresa Food Products Ltd (BFPL), to quench the thirst of the millions of Tanzanians and citizens of its neighbouring countries. Providing the vital lifeline, the company produced its first water brand in 1998 that is currently sold under the ‘Uhai’ and ‘Safina’ brand names. The investment in bottled drinking water paved way for the manufacturer to pump money into the establishment of the Azam Fruit Juice Processing Division. The stateof-the-art plant has the capacity to process 350 tonnes of fruits and vegetables daily and stores the pulp/juices/ concentrates in 210 litres aseptic bags. The factory also features the first indigenous aseptic packing facility for fruit juices in the country with the capacity of packing 100 million litres per annum. The product range includes apple, black currant, mango, orange, pineapple, guava, and tropical mix fruits juice drinks. The company’s premium range of nectar and fruit juice were introduced in 2010 in one of the most modern Tetra Prisma 1 litre packs with stream caps. This range included juices in mango, orange, pineapple, guava and tropical mix fruit, mango/orange and pomegranate flavours. This was followed with its launch of Tetra Prisma 330ml pack with Dream Cap. This one too featured a range of innovative flavours from the popular juice varieties to include strawberry and banana juice with added soya protein, pinacolada and lynchee. Having successfully established its presence in fruit juice and bottled water market, Bakhresa Group ventured into a new phase of beverage market in the year 2011 and started producing carbonated soft drinks and malt flavoured beverages. Further expanding its soft drink product range, the company entered into a production agreement with FOODBUSINESSAFRICA.COM

Nichols Plc, United Kingdom based producer of Vimto drinks in 2018, to produce the drink locally. Nothing seemed to slow down the processing giant as it further extended its line of businesses to dairy sector by installing a world class, sophisticated dairy plant in Zanzibar in 2014 to produce UHT milk such as full fat, low fat and flavoured milk. The plant has a processing capacity of 180,000 litres of milk per day. The Group is planning to launch yogurt and other dairy products soon but has already stamped its presence in the ice-cream market with its Azam and Nova brands – in which it is a clear favourite of consumers across the country and the largest operator. BFPL reveals that is proudly associated with Danice a/s, a sister company of Tetrapak

from Denmark for their product and process development and its ice cream plant has world class machineries and equipment from Teknoice and Catta-27 of Italy. Further expanding its offerings, the Tanzanian manufacturing behemoth runs the largest bakery in the country producing the popular Azam brand bread, biscuits, cakes and donuts. The state-of-the-art facility also manufactures high quality ready to use white and brown chapattis and samosa leaves. In its sleeves of tonnes of investment in Tanzania, its flag-ship company SSB is nearing completion of the first phase of the US$300 million Bagamoyo Sugar Limited that is set to officially start production by June 2022. The project, which has three phases, is expected to commence with an installed processing capacity of between 30,000 tonnes and 35,000 tonnes, with the annual processing capacity later expanded to 100,000 tonnes.

JULY/AUG 2021 | FOOD BUSINESS AFRICA

COMPANY HIGHLIGHT: BAKHRESA GROUP

KEY NUMBERS

US$300M

THE AMOUNT SSB INVESTED IN BAGAMOYO SUGAR LIMITED

VENTURING ABROAD Milling being its core business, Bakhresa Group has set up operations in over five countries in sub-Saharan Africa. The company tested the abroad water by opening its first mill in neighbouring Uganda in 1998. Situated in the country’s capital Kampala, Bakhresa Grain Milling Uganda Limited commenced operations with an installed wheat milling capacity of 250 tons per day. This was later increased to 450 tons per day in 2004, and later more than doubled to 1,050 tons per day in 2011, thereby becoming one of the largest wheat mill references in the country. Further spreading its operations in the region, Bakhresa incorporated its Malawian subsidiary in 2003 following the company’s take-over of assets of the former government parastatal, Grain & Milling Company Ltd (GRAMIL), under the Government of Malawi Privatisation Programme. Following the acquisition, Bakhresa invested in an ultramodern 250 tons per day capacity wheat mill and later doubled it to 500 tons per day in 2009. Bakhresa’s quest to become a leading player in the grain and milling industry did not stop there as the company in 2006 opened the Bakhresa Grain Milling Mozambique Limitada. The grain handing and bulk storage facility was set up inside the port of Nacala with a capacity to receive 600 tons of grain per hour and storage capacity of 30,000 tons. Later in 2012, the company commissioned an ultramodern 250 tons per day capacity wheat mill with a 30,000ton wheat storage silo in the Special Economic Zone of Nacala Industrial Area. The milling capacity was increased to 500 tons per day in 2013. The deep-pocketed manufacturing conglomerate set base in Rwanda in 2009 with the objective of manufacturing high-quality wheat products to cater to the local demand in 46

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the country and export to Eastern Congo and Burundi. The Rwandan mill is one of the pioneer facilities to be set up in the Special Economic Zone in Kigali. It boasts of a wheat milling capacity of 500 tons per day, serviced by storage units with capacity to hold 12,000 tons. The investment in Rwanda enabled Bakhresa to knock the doors in Burundi and commenced production in the East African nation in 2013 with a wheat mill of 360 tons per day processing capacity. In the same old-fashioned way of seeing gems in run down and defunct facilities, the milling giant acquired the old Union Flour Mill Building in Durban South Africa in 2015, turning it into a new 750 tons flour mill – becoming one of the few food companies from the rest of Africa to successfully invest in South Africa. This investment was followed in quick succession with Bakhresa’s acquisition of Zimbabwe’s second largest food and milling company Blue Ribbon Industries Limited (BRI) in 2015 for US$40 million. The Tanzanian company came to the rescue of BRI which was put into final administration in 2013 after the company collapsed in 2012 due to a cash shortage. The company later opened a new US$6 million wheat milling plant in 2018 with a capacity of 9,000 metric tons per month and a storage capacity of 700 tons of wheat. Blue Ribbon’s units include BRI Logistics, Blue Ribbon Foods, JA Mitchels and Nutresco Foods. The subsidiaries engage in wheat and maize milling, stock feed

FOODBUSINESSAFRICA.COM

ACCORDING TO A SURVEY BY BRAND AFRICA, AZAM WAS ONE OF VERY FEW EAST AFRICAN BRANDS TO JOIN APPLE, SAMSUNG, GOOGLE, MICROSOFT AND COCA-COLA ON THE LIST OF AFRICA’S 100 MOST VALUABLE BRANDS IN 2015.

manufacturing and production of peanut butter, corn soya blend, mahewu drink and soya chunks. SUPPORTING OPERATIONS Bakhresa’s operations both in its home country and across the region are supported by its other sister companies. For instance, its packaging needs are met by its poly-propylene woven bags unit in Mozambique commissioned in 2012. The facility which specializes in producing quality woven sacks both plain and printed, produces 40,000 bags per day catering to the needs of industrial and agricultural sectors. In Tanzania the company runs the Azam Polysacks Limited, a leading manufacturer and exporter of polypropylene/ HDPE woven bags/fabrics generally used for bagging of grain, flour, sugar, salt etc. In addition, the company manages one of the largest flexible packaging companies in Tanzania, Omar Packaging Industries Limited (OPIL). OPIL produces milk pouches; shrink-wrapping; LDPE sheeting in rolls, carry bags and water pouches; HDPE shopping bags; bread bags; laminating for snacks, rice, confectionery, sugar, among others. State of the art multi-colour flexographic printing machines from Europe are used to print the papers. Further to that, Bakhresa has set up an exportoriented packaging manufacturing unit dubbed Paperkraft International Limited. The company produces small size paper bags and outer bags used for packaging of flour, sugar, salt etc. The plant uses raw materials from renewable sources in addition to reusable waste to make its products. Meanwhile, for its transportation needs, the group has set up a transportation division, playing a crucial role in the supply chain process. Said Salim Bakhresa & Company Limited offers cost effective options for all transportation and logistical needs within Tanzania and from the country to neighbouring landlocked countries. SECURING THE IDENTITY Having found the correct balance of extensively investing in different sectors, producing quality and affordable FOODBUSINESSAFRICA.COM

products and most importantly building a strong brand, Bakhresa has managed to win both in home and abroad markets. But its secret ingredient seems to majorly lie on its unique identity. Bakhresa took steps to protect the Azam trademark in 1999, as it began expanding its product line as it entered overseas markets. A strong trademark is particularly important in less developed and very diverse markets in which many languages are spoken, making consumers seek symbols to help them choose the correct product. Brand names also have real economic implications. For instance, Azam being well known enables the company to launch new products in an economical and efficient way. According to a survey by Brand Africa, Azam was one of very few East African brands to join Apple, Samsung, Google, Microsoft and Coca-Cola on the list of Africa’s 100 most valuable brands in 2015. Ferociously protecting the brand, the company in 2019 rebranded its Azam wheat flour into multipurpose flour in a bid to address unlawful

copying of Azam product features and re-bagging. Despite Azam brand being synonymous in most households in the region, Bakhresa in 2018 rebranded its fruit juice range to African Fruti to boost market penetration across the globe. The fresh look features a vibrant African setting, targeting mostly abroad markets such as China and the United Arabs Emirates (UAE). With the transformation of Bakhresa from a small family run business to a multi-industrial conglomerate, both established and growing businesses can grab a page or two from the company’s journey to success script. FBA JULY/AUG 2021 | FOOD BUSINESS AFRICA

COMPANY REVIEW: PEPSICO

PepsiCo's strategy in its last growth frontier, Africa, could succeed this time round By Paul Ongeto

PepsiCo has had a chequered history in Africa, but recent moves could change the game

epsiCo's history in Sub-Saharan Africa dates to 1948 when the company set foot in apartheid-era South Africa. Using the South African nation as its base, PepsiCo ventured northwards, launching operations in Kenya, Uganda, and Tanzania in the East and Nigeria in the west. Throughout the region, Pepsico’s approach was much like Coca-Cola's: outsource bottling operations to

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independent bottlers. According to Euromonitor, the drink giants find this strategy attractive as they get to largely retain control over beverage production, sacrificing some margin but satisfying investors by reducing direct exposure to the volatility of distribution costs. Having failed several times, PepsiCo is changing its strategy on the African continent and now prefers to have more boots on the ground than it previously did. FOODBUSINESSAFRICA.COM

With growth slowing down in North America and Europe, Africa, with a rapidly expanding middle class, presents opportunities that PepsiCo cannot ignore. The region may just prove PepsiCo’s last growth frontier. SPREADING THE PEPSICO FIZZ IN EAST AND WEST AFRICA Perhaps the most successful of PepsiCo’s franchises in Africa is the Seven Up Bottling Company (SBC). Launched in 1960 by Lebanese national Mohammed El-Khalil, the company, the largest of PepsiCo’s bottling franchises, controls over 40% of Nigeria’s beverage drinks market. From its 9 bottling facilities in Nigeria, the company also exports its PepsiCo products to the rest of the west African region. A 10th bottling facility is in neighboring Ghana to serve the rapidly expanding Ghanian market. In July 2021, the company celebrated its 60 years of operations in Nigeria with the launch of a new look and identity. It also launched its new office building in June, at its corporate headquarters in Ijora, Lagos, as it seeks to become a hub of quality products and solutions. SBC has also been bold enough to re-introduce the Pepsi brand in Tanzania and Kenya, where it had completely disappeared thanks to dominant Coca-Cola that made PepsiCo’s investments make losses. In 2021, SBC marks 20 years of operations in Tanzania, having launched operations back in 2001. TODAY, THE 350ML BOTTLES OF PEPSI, 7UP, MIRINDA, AND MOUNTAIN DEW ARE UBIQUITOUS IN TANZANIA AND CAN BE FOUND AS FAR AS MWANZA Today, the 350ml bottles of Pepsi, 7Up, Mirinda, and Mountain Dew are ubiquitous in the country and can be found in Mwanza, a considerable distance from the company’s base in Dar es Salaam. With the success of the Pepsi brand in Tanzania, SBC in 2013 invested in a new US$28 million bottling facility at the heart of Kenya’s capital Nairobi, to take on market leader Coca-Cola. Where previous franchisees have failed, SBC proved resilient, reducing Coca-Cola's absolute dominance in East Africa and increasing PepsiCo’s market share to over 20%, according to 2019 Standard Chartered report on the East African soft drinks market. VARUN RE-IGNITES COLA WARS IN SOUTHERN AFRICA Apart from SBC, Varun Beverages is the other PepsiCo franchise with operations in more than one African country. Based in Guruguram, India, Varun Beverages is the second largest bottler of PepsiCo drinks outside the United States. In Africa, it is credited for introducing the brand in Zimbabwe, Zambia and Mozambique. The company first arrived in Zambia in 2015, injecting US$30 million into the FOODBUSINESSAFRICA.COM

establishment of a new bottling facility in the country’s capital Lusaka. Starting a new cola war with rival Cocacola, the company invested hugely in advertising its products particularly on billboards that covered almost every corner of the capital. The company also did a good job in how they placed their products in supermarkets and restaurants. Varun’s efforts bore fruits as Zambians readily embraced the products. No one knows if it was Pepsi’s taste, its higher quantity, or its lower price that had Zambians hooked. What we however know for sure is that a year into production, the company recorded sales volumes of 10.7 million cases and reported to be “highly profitable with strong free cash flow generation.” This prompted the Indian-based bottler to raise its stake in its Zambian subsidiary from 60% to 90% in 2017. Three years after launching in Zambia, Varun tried to replicate the same success in neighbouring Zimbabwe. In Harare, the company injected an initial capital of US$30m into a new plant. Costs however spiraled and by the time of commissioning in 2018, the Zimbabwean plant had cost the Indian bottler about US$50 million. Zimbabwe has however turned out to be a difficult market. Unlike Zambia, the company was reported in 2019 to be having challenges recouping its investment due to a turbulent economic environment characterised by an acute foreign currency shortage. The company is however not giving up hope yet, like it did in Mozambique in 2015 when it divested 41% of its stake in the local subsidiary due to what it termed as limited opportunities to scale up operations. As a show of its commitment to Zimbabwe, the company recently commissioned a new production line to ramp up production of its Aquaclear bottled mineral water. In July, the company announced plans to have 1,000 more push carts to supply its products in remote rural villages and small population areas of Zimbabwe. “This JULY/AUG 2021 | FOOD BUSINESS AFRICA

COMPANY REVIEW: PEPSICO

KEY NUMBERS

US$1.7B

THE AMOUNT PEPSICO INVESTED IN THE ACQUISITION OF PIONEER FOODS

move will also create employment and enable availability of affordable, world class products in the remote markets of Zimbabwe,” Varun Beverages Zimbabwe Vice President Fungai Murahwa said. Varun targets 50% of the country’s beverage market by 2030 and despite the challenges, it is hopeful that the business will potentially thrive in the long term. In a state visit to Zimbabwe, Varun Chairperson Ravi Jaipuria expressed interest to diversify into production of key agricultural products and that his company was looking at opportunities in dairy, juices and potato farming, and manufacture of chips in the long term. The company has already received support from the highest levels of government with President Mnangagwa, while delivering his keynote address, confirming the Indian billionaire's request for farming land, and pledged to avail prime land for him to produce crops that are in short supply in Zimbabwe. If Varun does not make it with Pepsi Cola and 7Up, maybe a bet on dairy, juices, and potato will help. PepsiCo’s snacks business Fritolay, has proved diversification works and maybe Varun could borrow a leaf or two from its much larger partner. CROWN BEVERAGES: PEPSICO BOTTLER OF THE YEAR In the PepsiCo portfolio of African bottlers, Moha Soft Drinks of Ethiopia and Crown Beverages of Uganda stand out as the only locally owned business establishments. The two companies have also proved to be among the most resilient of PepsiCo’s businesses. Moha Soft Drinks has been in operation since 1996 and today celebrates 25 years of existence while Crown Beverages has refreshed Ugandans with Pepsi Cola and 7Up drinks for more than 28 years now. Despite being considerably smaller than its peers SBC and Varun, Crown Beverages also achieved a milestone in 2018 when it was crowned the PepsiCo Europe and SubSaharan African (Europe and SSA) Bottler of the Year. The award is the highest annual regional recognition given to bottlers premised on quality standards, community support, customer service, volume and sales growth as well as a proven commitment to performance with purpose. Crown Beverages beat 65 other bottlers from the region which also includes more advanced bottlers in Europe to win. 50

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To keep with evolving consumer trends, Crown Beverages also recently launched Pepsi MAX, a no sugar cola targeted at health-conscious consumers in Uganda. It is also noteworthy to add that Crown Beverages is the only bottler that has managed to control a much larger market share than one enjoyed by Coca-Cola in the continent. Although market shares shifts and competition is rife in Uganda, this is one region that Pepsi has given Coke a run for its money and succeeded. SOUTH AFRICA – PEPSICO'S ELUSIVE MARKET PepsiCo has always had an eye for South Africa. Being Africa’s most developed country meant that there was enough disposable income to purchase its products. It first launched in 1948 but was forced to suspend operations in 1985, after bowing to international pressure that called on companies to cease operations in the apartheid nation. During its return 9 years later, PepsiCo found a more robust Coca-Cola and was forced to shut down operations in 1997, saying that "Coke's stranglehold was too tough to pry loose." In 2006 PepsiCo made a second ill-fated attempt to return to South Africa, this time through a "franchise agreement" with Pioneer Foods. Again, consumers just didn't bite, and by November 2014, Pioneer said it could no longer swallow the losses it was running up because of the deal. FOODBUSINESSAFRICA.COM

Doritos into the South African market and by early 2000s, the company was controlling 63% of the country’s potato chips market. Finally, PepsiCo had got it right in South Africa, and may be replicating the same model across the sub-Saharan region wouldn’t be such a bad idea.

In mid-2015, Pepsi found a new partner in South Africa, Softbev, since merged into The Beverage Company. That company too ran into tough financial times before a cash injection from private equity firms. Despite the headwinds and difficulty in market penetration, The Beverage Company, has managed to keep the Pepsi brand alive in South Africa, although Coca-Cola still dominates the market. Realizing going head-to-head with Coca-Cola in South Africa was a losing battle, PepsiCo in 1995 decided to change its strategy. Instead of relying on soft drinks alone, the company decided to diversify into snacks business. This is an area that PepsiCo is good at. In fact, the snacks business props up the company across the world making it twice as large as Coca-Cola. Beverages only accounted for 45% of the company’s total revenues in 2020, while the rest was contributed by the food division, led by Frito Lay North America (the company’s largest snack division) which delivered 46% of the company’s profits in 2020. Starting from scratch in South Africa would have been a herculean task, so PepsiCo eyed an established local player in the name of Simba. Launched in 1957 by Leon Greyvenstein, Simba was already a household name by the time PepsiCo was acquiring it in 1995. Leveraging its extensive market reach, PepsiCo was able to introduce its other globally acclaimed snack brands such as Lays and FOODBUSINESSAFRICA.COM

A NEW APPROACH TO GAINING MARKET DOMINANCE IN AFRICA Even with the success enjoyed by the company’s division in South Africa, the maker of Doritos and Lay’s snacks never really considered replicating the same model in the rest of the region. Slowing growth back at home and a desire by CEO Ramon Laguarta to give PepsiCo a greater global presence however pushed the company into seriously considering strategies to grow into the sub-Saharan Africa market. In this regard, PepsiCo decided to upscale its South African success by acquiring Pioneer Foods, a larger food processing company based in South Africa but with a market reach estimated to span 80 countries. With the acquisition, PepsiCo not only got access to Pioneer Foods' distribution facilities, but also its local executives, who can continue to guide the merged company's growth. In South Africa where it has failed to make a significant dent with its Pepsi soda, market analysts believe that with Pioneer’s established relations with retailers across the country, maybe finally Pepsi, Mountain Dew, and 7Up brands will have a fighting chance. Pioneer has a massive distribution network throughout South Africa – and the kind of relationship with major supermarkets that make for prime placement, notes Business Insider. PepsiCo will almost certainly use the Pioneer Foods network to launch some of its products in South African supermarkets, says Schalk Louw, a portfolio manager at PSG Wealth. "Go into any shop and compare how CocaCola is placed compared to Pepsi’s beverages. Coke has pride of place, while the Pepsi products will be right at the back, if in the store at all." This may change under Pioneer’s charge and influence. PepsiCo is also expected to lean on this infrastructure and further invest in it so it can support the distribution of PepsiCo products and serve as a gateway into adjacent geographies. “Pioneer Foods represents a differentiated opportunity for PepsiCo and allows us to immediately scale our business in Africa,” Laguarta said during the acquisition. “Pioneer Foods forms an important part of our strategy to not only expand in South Africa, but further into sub-Saharan Africa as well,” he added. Analysts at Business Insider South Africa are projecting that some of PepsiCo’s biggest snack products such as caramel-coated popcorn and peanuts Cracker Jack, puffed wheat snack Sabritones and the legendary half-centuryold fake onion rings Funyuns, could well be heading to SA shores following the acquisition.

JULY/AUG 2021 | FOOD BUSINESS AFRICA

COMPANY REVIEW: PEPSICO

THE BIRTH OF PEPSICO SUB-SAHARAN AFRICA A US$1.7 billion investment is certainly not be taken lightly. To show its seriousness about its operations in the continent, the New York based food and beverage giant created the PepsiCo sub-Saharan Africa region to oversee its foray into the market with an estimated population of 1.14 billion. The PepsiCo SSA region was further beefed up in January of 2020 when PepsiCo acquired Senselet from CROWN BEVERAGES ACHIEVED A MILESTONE IN 2018 WHEN IT WAS CROWNED THE PEPSICO EUROPE AND SUB-SAHARAN AFRICAN (EUROPE AND SSA) BOTTLER OF THE YEAR. Netherlands-based Veris Investments. Founded in 2015, Senselet Foods has a leading market position in Ethiopia with its Sun Chips brand that is produced from locally sourced potatoes. In May 2020, the company appointed Pioneer Foods CEO Tertius Carstens as CEO of the new region, reporting to Eugene Willemsen, current CEO of PepsiCo Africa, Middle East, and South Asia region. During his appointment, PepsiCo revealed that the Sub-Saharan Africa headquarters will be based in South Africa and Carstens will be supported by four business unit leaders – responsible for Essential Foods, Groceries, South Africa Snacks and Sub-Saharan Africa Foods and Beverages respectively. PepsiCo competitors might be jittery about its enhanced presence in the region, but farmers are a happy lot. The maker of Doritos and Lays chips has for instance committed to expanding its Sustainable Farming Program in Africa and work with local farmers in Pioneer Foods' communities - including women and rural smallholders - to help boost yields, improve livelihoods, and preserve precious natural resources. 52

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The company has also created the PepsiCo Development Fund, which aims to create local jobs, increase local procurement, build small businesses, support education and holistically contribute to black economic empowerment in South Africa. The Development fund will also focus on providing access to affordable capital, offering year-round technical support, and increasing the adoption of regenerative agriculture practices to build farmer resilience. A US$2.5 TRILLION MARKET PepsiCo has all reasons to be upbeat about its expanded presence in Africa. Unlike North America where the company’s growth has slowed down to an average of 1.5%, Sub-Saharan Africa and Europe have been recording a CAGR of 6.2% from US$10.2 billion in 2016 to US$11.5 billion in 2018, according to figures from Nasdaq. This is projected to grow even further as more and more people in the Sub-Saharan Africa get into the middle class or upper class. An Africa In Focus report by Landry Signé, projects that the household consumption in the region is predicted to reach US$2.5 trillion by 2030. This market undoubtedly presents a new growth avenue for PepsiCo to more than offset the slow down which is expected to continue in North America. The creation of the African Continental Free Trade Area (AfCFTA) also presents a major opportunity for PepsiCo as it is expected to reduce tariffs among member countries and cover policy areas such as trade facilitation and services. This will make it easier and cheaper for PepsiCo to spread its products across the region, further accelerating its growth plans. Africa is however an unpredictable market. Predicting what would happen in the next 5 years can be as hard as finding a needle in a haystack. Only time will tell whether PepsiCo’s new strategy will be a success or a spectacular failure. FBA

FOODBUSINESSAFRICA.COM

Dairy

BUSINESS

TRENDS IN FORMULATING, PROCESSING, PACKAGING & CONSUMPTION OF DAIRY PRODUCTS

Ice Cream: Scoops of delight unravelling tonnes of treats By Catherine Wanjiku

Emerging trends in ice cream open new opportunities for innovation ce cream: two words with the power to send consumers’ taste buds into an overdrive. This frozen and creamy treat is nearly irresistible by many as it provides a moment of luxury, bliss and decadent treat to be savoured down to the last drop. Other than being tastier and creamier, fastevolving consumer tastes and preference in ice cream have led to the premiumization of the product by adding innovative flavours and more advanced constructions to deliver new sensations and a deluxe eating experience.

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In the Asia-Pacific region, 29% of consumers perceive ice cream to be premium and innovative when cheesecake or cheese pieces are added, according to the IPSOS survey of consumers in Indonesia, India and China. In Latin America, inclusions such as candies and cookies can help position ice cream as premium, while most European consumers (79%) are looking for natural and authentic ingredients. Creating ice creams with extras such as inclusions, layers and toppings turn a standard product into a premium one. This has led to ice cream manufacturers to roll their JULY/AUG 2021 | FOOD BUSINESS AFRICA

DAIRY BUSINESS AFRICA: ICE CREAM

sleeves and come up with a generous helping of “Wow!” FLAVOUR OPTIONS Just a few years back, ice cream wasn’t hip as the offerings were the same almost everywhere such as chocolate, vanilla or strawberry flavour. However, the narrative has changed and there are hundreds of flavours that have recently graced the ice-cream aisles. While some consumers prefer the staples, others in many areas are cooling down with fun new flavours. SOPHISTICATED FLAVOURS Ice-cream processors have begun pairing sophisticated ice cream flavours with familiar favourites for a premium flavour experience. Some of these flavors might include ethnic, alcohol, tea or spicy tastes. The brand Humphry Slocombe does this well by offering Turmeric-infused Honey Milk ice cream with Chocolate Chip Gingerbread and Candied Ginger. Asia’s leading dairy products producer, Yili Group, unveiled a wider range of new ice-cream flavours in 2019 to include mint, blueberry and sweet-corn flavour, with durian and mango flavour. In a bid to cater to the older consumer group, processors have introduced liquor ice cream which is gaining popularity across developed regions such as North

KEY NUMBERS

US$95BN

PROJECTED GLOBAL ICE CREAM MARKET BY 2027

America and Europe. The products contain less than 0.5% alcohol, and therefore, are widely retailed in grocery and specialty stores. For instance, Häagen-Dazs launched spirit-infused ice cream with a flavor of five traditional pints made with Irish cream, rum, bourbon, and stout. Back in 2015, Australian ice cream firm Bulla Dairy partnered with global spirits company Diageo to launch a range of ice creams flavoured with the Irish cream liqueur, Bailey’s. BITTER-SWEET TASTE Further pushing the boundaries and keeping up with the adventurous consumers, savoury flavours have infiltrated the ice cream category. In Kenya, Glacier Products offers salt and caramel ice-cream under its Dairyland brand. Recently, Cleveland-based Pierre’s Ice Cream Co. created a new ice cream line to honor everyone who has adapted, struggled, sacrificed and persevered during this challenging time dubbed Virtual Hugs - a caramel ice cream with sea salt caramel truffles. According to research company Innova Market Insights, salted caramel is an indulgent flavour that has exploded into the mainstream in recent years. It was ranked as the fifth most popular taste within launch activity in 2019, up 10 places since 2015. However, it is even more popular in helping to deliver an indulgent image to guilt-free products, taking fourth place in non-dairy ice cream launches, third place in low fat ice cream and second place in low sugar category. NOSTALGIC FLAVOURS Ice-cream makers have delved deeper into the craft and in pursuit of attaining real connection with consumers have turned familiar tastes into the sweet treats. Ice cream already fits in the comfort food category, and by offering nostalgic flavours, brands are delivering a double dose of TLC. Multinational food Ingredients company Kerry indicates that the resurgence of nostalgia has been on the rise across all food and beverage categories, as consumers look for comforting foods and flavours during the pandemic. For instance, comforting and nostalgic breakfast-inspired flavors such as buttered French toast, pancake and everything bagel are now available in ice cream form.

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DAIRY EXPO Ample Hills Creamery has an oatmeal cookie-based ice cream as well as flavors that incorporate marshmallow, cereal, pretzels and chips. Taking consumer’s momentarily down memory lane, Jeni’s has an ice-cream line of the classic peanut butter and jelly sandwich, with roasted peanut butter and fluffernutter flavour. “During this time when lives are disrupted, consumers are reaching for food and flavours that provide emotional comfort, make them feel pampered and remind them of childhood,” Normunds Staņēvičs, CEO of Food Union Group said in an interview with Dairy Reporter. However, the trend was prior the pandemic period, as Froneri-owned ice cream brand Kelly’s of Cornwall launched a new sticky gingerbread flavour ice cream in the UK in 2018 ahead of Christmas, bringing in the festive mood.

SPECIALTY & COUNTRY PAVILLIONS

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EXPLORATIVE FLAVOURS With COVID-19 still limiting travel for most people, icecream flavours inspired by global cuisines have gone main-stream as consumers are now travelling the world through their taste buds. According to a 2020 study by Innova Market Insights, 64% of U.S. consumers want to discover flavours from other cultures. Majorly, consumers are interested in Mexican-inspired flavours, with offerings such as dulce de leche, mango salsa, mango chili and churro all popping up on foodservice ice cream menus. Ice creams inspired by South Asian beverages are also trending such as the chai-flavoured ice cream from Northeast-based Ample Hills Creamery. Thai tea and matcha have made their way into California-based TO SATISFY CONSUMERS’ DEMANDS, ICE CREAM BRANDS ARE INCORPORATING MORE INSPIRED-BY-NATURE AND HEATH HALO INGREDIENTS AND FLAVOURS INTO THEIR PRODUCTS. Coolhaus ice creams, and New York’s Noona’s Toasted Rice ice cream was inspired by noo-roong, a traditional Korean snack that comes from the caramelized layer of crunchy rice that forms on the bottom of a pan of cooked rice. LOADED INDULGENCE With pleasure still being the driving force behind ice cream purchases, indulgence is the name of the game. Some argue that because ice cream rarely qualifies as “healthy”, the calories must be worth it. To this end, ice-cream brand owners are loading all the good stuff on the frozen novelty. The market has seen a shift from just a mixture of two or more flavours in one tub to loading of different delights in the product. "Mimicking foodservice-inspired desserts by incorporating mix-ins and toppings into frozen treats is an FOODBUSINESSAFRICA.COM

The Dairy Expo enables consumers, traders, distributors and the general public to touch, feel and taste the latest processed and packaged dairy products, including: Packaged Milk • Yoghurt • Ice Cream • Cheese • Butter • Ghee • Milk Powder • Dairy Alternatives • Traditionally Fermented Milk

DECEMBER 2-4, 2021

SARIT EXPO CENTRE, NAIROBI, KENYA

Afmass FOOD EXPO

A SPECIAL PAVILLION AT:

The Future of Food in Africa

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DAIRY BUSINESS AFRICA: ICE CREAM

opportunity to strengthen retail value propositions," notes Kaitlin Kamp, consumer insights analyst on the Food and Drink Reports team at Mintel. Brands offering fully-loaded decadent packaged ice cream options include Ben & Jerry’s, who introduced its 'Topped' product line in 2021, which it calls “an ice cream sundae in a pint. It's made up of seven different ice cream flavours that are each covered with a velvety layer of chocolate ganache with chunks of other goodies. In South Africa, premium food processor, In2food, recently launched Choc Brownie Ice Cream in partnership with Froneri Dairymaid’s Gelato Roma Brand. The decadent gelato is made with chocolate sauce and brownie pieces to create the perfect balance of soft chewy texture at a frozen temperature. Cruising to West Africa, Cold Stone Creamery launched Baby Cakes, a strawberry ice-cream layered with yellow cake and topped with a crunchy coconut shaving. The mix and mash up renditions can be also achieved through bringing multiple brands together like the Breyers 2-in-1 products. Adding layers in the product creates a new taste experience, where with every inch the teeth dig into the ice-cream new flavours unravel to the delight of the consumer. Under this category, Magnum ice-cream entices consumers with its double cherry truffle with a dark chocolate ganache swirl dipped in a chocolaty coating, ACCORDING TO NETHERLANDS-BASED FOOD COLOURS AND INGREDIENTS PROVIDER, GNT GROUP, ICE-CREAM PURCHASE DECISIONS OF ONE THIRD OF CONSUMERS WORLDWIDE IS INFLUENCED BY THE COLOUR OF THE PRODUCT luscious cherry sauce, and milk chocolate. My/Mo Mochi Ice Cream unveiled a new range of triple layered Mochi ice cream in 2019, consisting of the traditional mochi dough exterior which covers the ice cream, with an additional central layer which adds an extra flavour. The inclusion of food pieces such as chocolate, candy, nut and cake particles are also becoming a fast-growing premium trend. HEALTH BOOSTING TREATS Pleasure is still the driving force behind ice cream purchases, however, in the contemporary consumer environment the balance between health and indulgence is increasingly important and a new report from Innova Market Insights highlights the ice cream category’s growing focus on delivering pleasure without the guilt. To this end, development of better-for-you recipes is already on many producers’ strategic radar. The challenge is to create products that are healthier without compromising on ice cream’s beloved taste and texture. To satisfy consumers’ demands, ice cream brands are 56

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incorporating more inspired-by-nature and heath halo ingredients and flavours into their products. For example, Cloud Creamery launched a blueberry-ginger-sage sorbet and New York’s Hay Rosie Craft Ice Cream Company has a Sage Chocolate Chip flavor. Carmela Ice Cream, in California, offers flavours including Lemon Basil Sorbet and Rosemary with Toasted Pine Nuts. Also, in 2020, Dairy Day launched Dairy Day Plus, a range of ice creams with immunity-boosting ingredients such as turmeric, pepper and honey. Fruit is also becoming staples in the ice cream category, while other brands are branching out into vegetableinspired flavors. For example, Arizona’s Sweet Republic ice cream shops have offered an avocado jalapeno ice cream while San Francisco’s Mitchell’s Ice Cream has an ube (purple yam) flavor. The processors are creating pints that have fewer calories, less sugar or low fat. A great example of this trend is the immensely successful brand Halo Top, with calorie count appearing boldly on the front of the package, which saw a 462% compound annual growth rate 2013- 2018. FOODBUSINESSAFRICA.COM

Ice-cream processors have also become intertwined in the complexities of mixing and crafting the perfect mix of ingredients to deliver surprisingly high levels of key nutrients like protein into ice cream. Laden with a mixture of whey protein concentrate and other highquality ingredients, every scoop of high-protein ice-cream is a guilt free pleasure. In 2019, the family-owned dairy company, Graham the Family Dairy launched a new line of high-protein ice cream known as Goodness Ice Cream. Halo Top, which promotes itself as “ice-cream you can feel good about eating”, flags its protein content of 18 g or 20 g on each 472g tub – numbers that are likely to catch the eye of protein-hunters.

Riding on the low fat tagline, Ben & Jerry's launched an ice cream with 60-70% less fat and 35% fewer calories than its traditional ice creams in 2018. In the sugar reduction font, sweetener blends are key, and attention is shifting to new-generation sweeteners. Mammoth Creameries recently released three new flavors of its keto-friendly, diabetic-conscious frozen custard, including Butter Coffee, Strawberry and Butter Pecan. Broader reformulations are also seeing the incorporation of functional ingredients such probiotics, more protein, fiber and CBD. One interesting example is Van Leeuwen Artisan Ice Cream's Vegan Couch Potato which contains approximately 5 milligrams of CBD in each scoop. Meanwhile, with increasing consumer adoption of probiotics to enhance overall wellbeing and most importantly gut health, food manufacturing giant Unilever is deemed to have launched the first premium ice cream containing probiotics in 2018. Dubbed Culture Republick, each pint tub contains three billion live active cultures, between 400 and 500 calories, 16-18 grams of protein, 1112 grams of fibre and no artificial sweeteners. FOODBUSINESSAFRICA.COM

INGREDIENT SPECIFIC ICE-CREAMS Shifting focus to the primary ingredients and processing techniques, it brings to the fore the dairy alternative, organic and clean label product segments. The changing consumer preference towards non-dairy and plant-based products due to reasons such as health, sustainability and animal welfare have driven some icecream manufacturers to replace animal sourced milk with coconut milk, almond milk, soy milk or oat milk. For example, My/Mochi Ice Cream recently launched My/Mochi Oat Milk Frozen Dessert, a non-dairy, vegan line of My/Mochi with gluten-free, non-GMO and allergenfriendly ingredients. Baskin-Robbins’ also unveiled an oat milk-based, vegan-friendly flavor: “Non-Dairy Strawberry Streusel.” Nick’s ice cream and animal-free dairy company Perfect Day have also partnered to launch a line of vegan dairy ice creams. Another popular trend of healthy living is demand of the most natural and less processed food products with a simplified ingredient statement. The frozen foods isle is no exception, as ice-cream brands such as Haagen-Dazs contain only five ingredients: milk, cream, sugar, eggs, and the characterizing flavour. Going the organic way and less utilization of artificial additives, processors are substituting the use of chemical compounds such as emulsifiers with eggs to improve its stability. Chai Latte, Maple Cream, and Vanilla Fudge Swirl launched by Straus Family Creamery in 2019 are some of the organic ice-creams in the market. MAINTAINING ICE-CREAM’S INTEGRITY Speaking of stability, consumers have become increasingly aware of their surrounding and want to avoid mess to protect their hygiene in this post-Covid-19 era. A premium stick novelty ice cream that smears a smartphone screen, drips on clothes or spills chocolate on the car seat can quickly lose its appeal. The melting conundrum can be solved by the use of emulsifiers and stabilizers to create drip-free products. Palsgaard, a Danish specialist in the manufacture of emulsifiers and stabilizers, is enabling processors to live the ice-cream JULY/AUG 2021 | FOOD BUSINESS AFRICA

DAIRY BUSINESS AFRICA: ICE CREAM

According to Netherlands-based food colours and ingredients provider, GNT Group, ice-cream purchase decisions of one third of consumers worldwide is influenced by the colour of the product, as the human brain connects certain colours to certain flavours: red for strawberry, light green for mint, purple for grape, brown for chocolate. Also, colour changes the way consumers enjoy the product, influencing perceptions of sweetness and flavour intensity. For instance, consumers assume that more intensely coloured foods are likely to be more intensely flavoured. However, should the colour not match the taste, then the result may well be a negative confirmation of expectation. Meanwhile, with rising demand of healthy treats, colour is crucial in ensuring these indulgent products look suitably appetizing. To achieve the perfect hues, processors use both natural and artificial colour agents.

dream as it has innovated and launched a wide range of solutions aimed to face one of the product’s toughest opponents - The Heat Shock Effect. Of all the frozen food types, ice cream is the most sensitive to temperature fluctuations and changes can occur anywhere between the factory and the dinner table. However, Palsgard notes that with the right blend of emulsifiers, stabilisers and know-how, the quality of ice cream can be helped to stay that way – and customer satisfaction maintained or even increased. Other than improving heat shock stability in ice-creams, emulsifiers and stabilizers maintain the integrity of the product during production of decadents with less saturated fats, high-protein and low-fat. Creation of these products entails alternation of chemical bonds by removal, addition or replacement of different components which can alter its composition. The use of emulsifiers and stabilizers ensure the product’s quality and eating experience is maintained. For the clean labels, Palsgaard has developed a series of emulsifier and stabilizer blends for ice cream with reduced E-numbers from the common three to five to only one E-number. LOVE AT FIRST SIGHT According to most ice-cream makers, having a perfectly crafted and formulated product is not just enough - presentation ensures the product is half-way to acceptability. 58

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DRIVING GROWTH IN ICE-CREAM INDUSTRY The global ice cream market size is projected to reach US$ 95.2 billion by 2027, from US$ 67.94 billion in 2020, growing at a CAGR of 4.9% during 2021-2027, according to research firm Valuates. To further drive this growth, world’s leading food processing and packaging solutions company, Tetra Pak, recently launched an ice cream extrusion line aimed at improving product quality and volume flexibility for mediumcapacity producers. The new line with a capacity range of 5,000 to 18,000 products per hour uses an independently controlled horizontal cutter to slice the ice cream as it emerges from the extruder. It also offers volume flexibility OTHER THAN IMPROVING HEAT SHOCK STABILITY IN ICE-CREAMS, EMULSIFIERS AND STABILIZERS MAINTAIN THE INTEGRITY OF THE PRODUCT DURING PRODUCTION OF DECADENTS WITH LESS SATURATED FATS, HIGH-PROTEIN AND LOW-FAT. to the medium-sized producers, allowing them to increase or decrease output without compromising efficiency. Also, the multinational company launched the Tetra Fino Aseptic 100 Ultra MiM in 2017, a new package that offers customers an opportunity to produce liquid dairy and juice drinks using their existing production processes, and market them as ice creams and frozen products. The new package allows dairy and juice drinks to be produced and distributed in small carton pouches at room temperature, and subsequently turned into frozen products in shops or in a consumer’s home. This means producers can tap into the multibillion-dollar ice cream market without the need for additional investments in production equipment and chilled distribution system. FBA

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BeverageTECH TRENDS IN FORMULATING, PROCESSING, PACKAGING & CONSUMPTION OF BEVERAGE PRODUCTS

Pandemic stimulates appetite for functional beverages as it stirs innovations and new product developments

W By Paul Ongeto

ith the COVID-19 crisis reinforcing the importance of health and wellness, consumers have been clamoring to have a daily dose of functional beverages. Renewed appetite for functional beverages seems to stem from the belief, now scientifically validated, that these beverages do have healing and health-giving properties. Although the popularity of functional beverages picked FOODBUSINESSAFRICA.COM

momentum in the Covid-19 era, consumers were already developing an appetite even before the pandemic struck. A recent global market report found that between 2016 and 2019, launches of products with an immunity claim grew by 9% in the juice category, 43% in flavored bottled waters and 32% in energy drinks. COVID-19 further increased awareness resulting in over 400 launches of refreshing beverage products with immune health benefits in 2020, according to an Innova report. In JULY/AUG 2021 | FOOD BUSINESS AFRICA

BEVERAGE TECH AFRICA: TRENDS IN FUNCTIONAL BEVERAGES

COVID-19 FURTHER INCREASED HEALTH AWARENESS RESULTING IN OVER 400 LAUNCHES OF BEVERAGE PRODUCTS WITH IMMUNE HEALTH CLAIMS IN 2020

this issue, we explore how the pandemic and desire for healthier nutrition have resulted in new developments in the functional beverages scenes and opportunities for beverage manufacturers. COFFEE AND TEA KEEP GETTING BETTER Coffee and tea are arguably some of the oldest beverages to be enjoyed by man. Consumers today however want more than just the kick of energy that the caffeine in these drinks offers. To keep up with consumer preferences, the art of tea and coffee brewing is getting better and better, often incorporating new styles and ingredients to produce the same old tea drink but with improved taste profiles and added functionality. Tea, which was formally enjoyed alone is now being incorporated with other ingredients to boost its taste and functionality. At Virginia Dare, dark berries like acai, elderberry and goji are trending tea add-ins thanks to their established antioxidant content. Kericho Gold, a leading Kenyan tea brand, has also been experimenting with tea, recently launching cold brew teas that feature other ingredients like lemon, orange, and ginger. This is in addition to its elaborate “Attitude Teas” that include unique combinations such as passion and lime, green tea and lemon, and pineapple and mango. Other trending functional ingredients finding their way into tea include CBD, matcha and added vitamins and minerals. US multinational beverage company Coca-Cola also joined the RTD tea band wagon, launching its iced tea brand known as Fuze Tea that features tea combined with other ingredients such as chamomile, hibiscus, mango and peach. Innovations around tea seem to have handed the centuries-old beverage a new lease of life, with Grand View Research projecting the global tea market, worth US$12.63 billion in 2018 is set to expand at a CAGR of 5.5% 60

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through 2025. In coffee, Nitrogen infusions have become popular in brewing because they add a creamy, velvety mouthfeel that can enhance the perception of sweetness and add textural complexity without adding calories. Another common coffee add-in, creamers are also getting a makeover with dairy-based milk and cream replaced by plant-based versions, perfect for the growing number of consumers avoiding dairy for ethical, environmental or health reasons. Almond, cashew, macadamia, coconut and, increasingly, oat are all popular bases for nondairy creamers, sold both separately for at-home occasions and in RTD coffee beverages. As more people recognize the importance of proteins in the diet, Kerry notes that super charged coffee brews fortified with proteins are becoming daily specials in today’s new normal. As a result, ingredients like barley are also popping up in coffee drinks as a source of added protein. In addition, for a boost of mental clarity, nootropic ingredients like omega-3 fatty acids, L-theanine and lion’s mane mushrooms are gaining traction. Taking notice of the coffee craze, Coca-Cola also expanded its Coke portfolio to include one that fused the cola drinks “with real Brazilian coffee”. The drink has already been rolled in more than 50 markets globally, with January 2021 launch in the US being among the latest. Coffee may be the oldest functional beverage, but recent innovations are proof that the beverage isn't going anywhere any time soon. Research and Markets even projects that in the short term, the global coffee market will grow at a CAGR of 5.3% to reach US$134.25 billion in 2024. Alex Smolokoff of Food Beverage Insider however notes that brands would be well served to ensure any coffee beans used in their products are fairly grown, either through Fair Trade certification or other programs. FUNCTIONAL WATERS BECOME MORE PERSONAL Functional waters, viewed as a premium - and healthier alternative to soft drinks, are also evolving to catch up with ever changing consumer demands. Personalisation and customisation of drinks is among trends quickly gathering momentum in this space. US online soft drinks company uFlavour is among a growing number of companies that is giving customers the freedom to design their beverages. According to the company, users can craft drinks with specifications, such as sweeteners, acids, and flavouring agents. Bevi, a Bostonbased start-up, merged personalization with sustainability and the result was a smart water dispenser that provides FOODBUSINESSAFRICA.COM

customisable flavours using filtered tap water and natural ingredients to reduce plastic waste. In an Interview with Nutritional Outlook, Limitless co-founder Matt Matros noted that the functional water market is trending toward a “water-plus” format - a hybrid format that seeks to add another function to water than just hydration. He noted that his company was producing a water-plus-caffeine, targeting the diet cola drinkers. “With a lightly caffeinated sparkling water, consumers can get

KEY NUMBERS

134 BILLION

THE PROJECTED VALUE OF THE GLOBAL COFFE MARKET IN 2024

their kick while staying hydrated,” he added. Apart from these, manufacturers are also experimenting with water-plus-fiber, water-plus-fats, and even waterplus-hydrogen. Interesting combinations such as Pervida that combines sparkling water with pomegranate seed oil are also coming to the market to provide consumers with gut health boost. The strategy of highlighting the key functional ingredients in these beverages is expected to continue even as manufacturers work hard to link their products to health and beauty regimes. FOODBUSINESSAFRICA.COM

This strategy seems to be working, as functional water segment, which generated a revenue of US$29.11 billion in 2018 is expected to reach US$54.48 billion by 2025, recording a CAGR of 9.4%, according to data from Reportlinker. PROTEIN ENTERS HEALTH AND WELLNESS SPACE Protein’s role in maintaining good health, particularly among older adults and families, has made it to be a popular ingredient in today's functional beverages. Ingredients maker Volac notes that in the first six months of 2021, about a quarter of all consumers in Europe bought a protein RTD (ready to drink) beverage, which indicates the high level of penetration that these beverages have. As demand grows, Kerry notes that the market is advancing from classic protein powder drink mixes and the ubiquitous “protein shake” to a range of enticing new formats, tastes and textures of functional high protein beverages. High protein yogurts have for instance become mainstream with companies from General Mills to Chobani all launching products in this space. Although the demand for proteins is high, not all protein sources work well in beverage applications. Each protein source provides a different taste, texture, and protein quality that affects the overall acceptability of these products. To overcome these challenges, manufacturers have developed new protein solutions that can work in a wide array of applications. Food ingredients manufacturer Volac has for instance launched Volactive Pro2O, a whey protein ingredient, specifically designed for clear drinks. “It can make a drink look as clear as water and it tastes delicious with very little astringency,” says JULY/AUG 2021 | FOOD BUSINESS AFRICA

BEVERAGE TECH AFRICA: TRENDS IN FUNCTIONAL BEVERAGES

TEA, WHICH WAS FORMALLY ENJOYED ALONE IS NOW BEING INCORPORATED WITH OTHER INGREDIENTS TO BOOST ITS TASTE AND FUNCTIONALITY. Alan Johnstone, Business Development Manager at Volac. Kerry’s ProDiem™ Refresh also works in a similar way and can be used to create refreshing and transparent lowpH protein waters, juices and energy drinks. With these developments, companies like Protein2o have been able to produce protein infused water with fewer calories than traditional drinks. SWEET BUT WITHOUT THE CALORIES The rising cases of obesity and type 2 diabetes across the world have also made consumers wary of their calorie intake. Standard table sugar may once have been a go-to sweetener, but those moments are long gone, and with sugar taxes spreading across jurisdictions, manufacturers have been left with no option but to drop the sweetener from their list of ingredients. The same consumers agitating for low sugar levels in their beverages are also not willing to compromise on taste. A Kerry study found that just over 70% of consumers rank flavour and taste as the “most important” factor in a beverage purchase. Artificial sweeteners such as aspartame, saccharin and sucralose were once popular because they are sweeter than sugar but lower in calories. However, artificial sweeteners are no longer desirable in production of functional beverages due to uncertainty around their long-term impact on human health. To achieve consumer demand for low sugar but still produce a beverage that does not compromise on taste and flavour, natural sweeteners like honey and agave are starting to gain prominence. Because these ingredients can have their own limitations, such as increased bitterness and metallic off-notes, Kerry advises manufacturers to use taste modulators to preserve the overall taste profile in the finished product. UNTAPPED AREAS FOR BEVERAGE MANUFACTURERS The functional beverages market is still an expansive area that offers many beverage manufacturers opportunities for new growth. Mordor Intelligence projects the global functional beverage market’s CAGR at more than 8% by 2024, with Asia Pacific at 7.5% CAGR between 2020 to 2025. Developing new functional beverages with plant proteins is an area that holds immense potential, according to recent research by Kerry. More than two-thirds of consumers view protein from plant sources as “healthy” compared to the 42% that take the same view of animal protein, making any new products with plant-based clams highly sought after. Additionally, advances in technology have led to great innovations in plant-based proteins ingredients 62

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and technologies that mask flavour and smoothen texture. Manufacturers can now play with exciting new sources such as canola (also known as rapeseed), sunflower and flax in addition to established plant protein sources including soy, pea and rice to produce beverages that pack a healthy halo in the areas of fibre, mineral and vitamin content. Functional fortification is another area that beverages makers can exploit to differentiate their products. “Adding ingredients such as probiotics and prebiotics, fibre and flavonoids to beverages can be an effective way for manufacturers to differentiate their products and attract new consumer segments,” notes Kerry. Calcium is another in-demand ingredient which can become an important

addition to lactose-free products, which normally do not contain as much calcium as their full-lactose versions. With the clean label quickly gathering momentum in the Asia Pacific, Middle East, and Africa (APMEA), shoppers are now preferring to buy foods and beverages that contain natural, familiar, and simple ingredients. These presents new opportunity to either create new products or reformulate existing ones in line with clean label demands. CONSUMER COMMUNICATION KEY Finally, communication with a consumer is key if producers are to thrive in this thriving market. With so many options available, your product- although superior from the functional point of view - may be lost in the wall of choices that face consumers every time they visit the grocery store. This makes it is especially important that manufacturers clarify the benefits offered by their products. A recent report found that half 49% of global consumers want more information about the nutritional value of products, while Kerry has through research shown that many people now make purchase decisions by looking for ingredients they recognize or ones that are supported by scientific data. Food and beverage brands that effectively communicate how their products support immune system health are predicted to flourish as the pandemic continues to unfold and will have lasting demand post-COVID-19. FBA

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TRENDS IN FORMULATING, PROCESSING, PACKAGING & CONSUMPTION OF MILLED & BAKED GOODS AND ANIMAL FEED

Managing the Mycotoxins Challenge in Poultry The challenge of mycotoxins in poultry is a rising concern in many African countries

By Catherine Wanjiku

he poultry sector is one of the fastest growing agricultural sub-sectors especially in developing countries. The sector plays an extremely important role in these economies in terms of ensuring food security and offering proper nutrition. Factors such as population growth, rise in income levels, and urbanization are set to contribute to the growth of the sector in the future. According to reports by Research and Markets, the sector is expected to grow from US$310.7 billion in 2020 to US$322.55 billion in 2021 at a compound annual growth rate (CAGR) of 3.8%. The market is further

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expected to hit US$422.97 billion in 2025 with a CAGR of 7%. Despite the sector being set for exponential growth, poultry birds are faced with a myriad of challenges such as high susceptibility to diseases and infections, which cause huge losses and economic setbacks. One such threat is the ingestion of mycotoxins, which are naturally occurring toxins produced by certain moulds (fungi) and can be found in poultry feed. Some of the moulds that are most common in poultry feed are Aspergillus, Fusarium, and Penicillium. Poultry Science indicates that these fungi produce several mycotoxins such as such as aflatoxins (AF), zearalenone (ZEN), JULY/AUG 2021 | FOOD BUSINESS AFRICA

MILLING & BAKING AFRICA: MYCOTOXINS IN POULTRY

ochratoxin A (OTA), fumonisins (FUM), and trichothecenes such as deoxynivalenol (DON) and T-2 toxin, which are of great concern to the poultry industry. The fore mentioned mycotoxins are commonly prevalent in maize, wheat, soybean meal and barley, feeds which form the bulk of ingredients used in poultry rations. PREVALENCE OF MYCOTOXIN ACROSS THE GLOBE A recent update on the occurrence of mycotoxins in the raw commodities and finished feeds by BIOMIN Mycotoxin, indicated that the most prevalent mycotoxins globally are DON (65%) and FUM (64%), followed by ZEN (48%). The study was based on 96,684 analyses performed between January to December 2020 on 21,709 finished feed and raw commodity samples sourced from 79 countries. Overall, 65% of the samples had at least one mycotoxin above the thresh-hold level. With a threshold level in parts per billion (ppb) of AF-2, ZEN-50, DON-150, T2-50, FUM-500 and OTA-10, risk of contamination in sub-Saharan Africa was flagged as severe as 92 % of the cereal samples tested were found to have been contaminated by DON with a maximum of 917 ppb. In North America, the case is extreme with DON being one of the main concerns in all species. It was present in 72% of maize samples and in 89% of cereal samples. Average of positives for DON in maize was quite high with 808 ppb and even higher in cereals at 1,721 ppb. Maize in the region was also affected by FUM and ZEN with averages of 2,405 ppb and 323 ppb, respectively. Meanwhile 64

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in Central America, nearly all 97% of maize samples tested positive for FUM at an average of 1,820 ppb and a maximum of 24,233 ppb. The by-product maize gluten was highly affected by FUM, ZEN and DON with 100%, 75% and 69% prevalence, respectively. Average contamination was extreme for ZEN with 1,468 ppb. From the analysis, maize in South America is highly contaminated with FUM at 83% and an average of positives of 2,280 ppb. In wheat, DON is the main threat as it was found in 83% of the samples with an average of 1,584 ppb. Soybeans were seen to be highly affected by ZEN with 73% of samples showing presence of A RECENT UPDATE ON THE OCCURRENCE OF MYCOTOXINS IN THE RAW COMMODITIES AND FINISHED FEEDS BY BIOMIN MYCOTOXIN, INDICATED THAT THE MOST PREVALENT MYCOTOXINS GLOBALLY ARE DON (65%) AND FUM (64%), FOLLOWED BY ZEN (48%). the toxin, followed by T-2 (51%) and DON (46%). The analysis also shifted focus to Europe, revealing that the most prevalent mycotoxin in the region is still DON with 70% of maize samples testing positive for this mycotoxin. DON reached a maximum concentration of as high as 11,875 ppb with ZEN increasing its average contamination in maize to 171 ppb. In Asia Pacific, FUM occurred in 96% of maize, followed by DON in 80% of the samples tested. ZEN is also a risk for animal production as it was present FOODBUSINESSAFRICA.COM

in 68% of the samples analyzed and a maximum of 11,786 ppb was found. In this region Aflatoxin remains a threat for animals. In maize, Aflatoxin was found as high as 2,495 ppb. Meanwhile, in the Middle East, DON increased its prevalence in all samples to 78%. HETEROGENEOUS SENSITIVITY TO MYCOTOXINS It is important to note that mycotoxin contamination can occur at any point of production and handling of the cereals. According to the Mycotoxins in Poultry report by Ayhan Filazi et al, production of the toxins starts in the farm, during transportation and storage, often under warm and humid conditions. With poultry feed containing various raw materials that are likely to have been produced in varied climatic conditions and handled differently, multiple types of mycotoxins might be found in a single feed. This

spells double trouble as the damage caused by mycotoxins is much greater when they are combined than when they occur individually, as they have synergistic or additive effects. Generally, poultry animals have heterogeneous sensitivity to mycotoxins as different species exhibit varied toxic effects. Ducks, geese, and turkeys seem to be more sensitive to mycotoxicoses than chickens and quails. The effects also depend on the level of contamination, length of time the animal has been consuming the mycotoxin(s), and the bird’s age, sex, and level of stress. To this end the FOODBUSINESSAFRICA.COM

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US$423 BN

PROJECTED GLOBAL POULTRY MARKETSIZE IN 2025

effects range from a slight reaction to death of the bird. Any mycotoxin present in feed is delivered straight to the gastrointestinal tract (GIT) of the bird, which is the most important organ for converting feed into energy. The GIT is also the biggest immune organ in the body system. Once compromised from exposure to mycotoxins, the bird suffers from immunosuppression which would lead to increased susceptibility to infectious diseases, reactivation of chronic infections, potential secondary reactions, and increased use of drugs coupled with ineffectiveness of vaccination programs. Further to that, mycotoxins exposure can cause reduced feed intake, retarded growth, oral lesions, abnormal feathering, organ damages (mainly kidney and liver), carcinogenicity, teratogenicity, decreased egg production, poor feathering and excessive mortality at high dietary concentrations, among other ailments. DETECTION MODES OF MYCOTOXINS These symptoms and lesions can be used to clinically diagnose the presence of mycotoxins in a feed although most are not just straightforward. Valid determination of mycotoxins and their metabolites is a crucial step in any intervention, mitigation, or remediation strategy to cope with the deleterious effects of the toxins to livestock. According to Mycotoxin Site, the most widely used method of detecting the disease-causing agents in animal feed are either antibody-based assays or chromatography techniques. ELISA is one of the most commonly used enzyme-linked immunosorbent antibody-based assay as it is affordable. However, its limit of detection for many mycotoxins often exceeds 0.2 ppm. In pursuit for higher precision, focus has shifted to use of Liquid chromatography coupled to a tandem mass spectrometry detector (LC-MS/MS) for the analysis of mycotoxins and their metabolites at very low concentrations and from complex biological samples. The advanced technique, detect hundreds of mycotoxins simultaneously in a sample. Other types of chromatographic techniques include: High-performance liquid chromatography (HPLC) and Gas chromatography and Mass spectrometry (GC/MS). HPLC and GC/MS have a detection limit of less than 0.05 ppm but requires expensive equipment and technical support, making LC-MS/MS to be the most suitable technique for use. JULY/AUG 2021 | FOOD BUSINESS AFRICA

MILLING & BAKING AFRICA: MYCOTOXINS IN POULTRY

BIOTRANSFORMATION USING MICROBES AND ENZYMES IS THE MOST EFFECTIVE STRATEGY AGAINST MYCOTIXINS, BIODEGRADING THEM INTO NON-TOXIC METABOLITES DIVERSE COUNTERACTIVE STRATEGIES Once the poultry feed has been put under test to determine the presence and level of mycotoxins contamination, its confirmation calls for decontamination approaches which are technologically diverse and based on chemical, biological and physical strategies. Managing mycotoxin exposure should start at harvest by removing heavily contaminated grains where possible. The heavily contaminated grains are considerably lighter than non-contaminated ones and thus can be removed with a grain separator that uses air flow to raise and separate very light kernels from the undamaged grain. However, in the case of purchase of mixed feed or ground grain, other methods will be needed in order to effectively deal with the mycotoxin load. A report by PennState Extension, calls for adoption of dilution of the affected feed with uncontaminated portions. However, this strategy demands for multiple sampling and mycotoxin analysis to determine the concentration of mycotoxin in every batch of feed, reducing the practical efficiency of this method for feed manufacturers. As an additional tip, prior to diluting affected raw materials, organic acids could be sprayed on them. This will kill most of the fungal contamination and will limit the mycotoxin production once the contaminated material has been diluted. Other physical processes aimed to eliminate mycotoxin contamination include controlling temperature and humidity using aeration especially in storage units as they serve as the main breeding grounds. It is also advisable to use fungal inhibitors and protection against damage caused by insects and rodents. If mycotoxin contamination is still an issue after attempted use of physical inhibitors, mycotoxin binders could be another option to reduce the impact of the toxins on poultry. The inclusion of binding agents or “enterosorbents” in the diet has been given considerable attention as a strategy to reduce foodborne exposures to mycotoxins. Potential mycotoxin binders include activated carbon; aluminosilicates (e.g., clay, bentonite, montmorillonite, zeolite, phyllosilicates); and complex indigestible carbohydrates (e.g., cellulose, polysaccharides in the cell walls of yeast and bacteria) as well as some synthetic polymers. It is important to note that the process of mycotoxin binding only starts when the animal ingests the feed. Due to this delay, even the most effective binding agent will not mitigate the initial toxic effect immediately after feed ingestion. Although this approach successfully eliminates the risk 66

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of certain mycotoxins such as Aflatoxin, it does not work comprehensively on all of the mycotoxins relevant to the poultry industry, especially not against trichothecenes mycotoxins since their structures are not suitable for adsorbing by binders. To this end biotransformation using microbes and enzymes is the most effective strategy. It provides reliable protection against mycotoxins, biodegrading them into non-toxic metabolites. Also, the technique is fast, specific and irreversible.

In addition to biotransformation, a bioprotection strategy is also important. A variety of feed additives are available that contains plant and algae extracts suitable to provide protection of vulnerable organs such as the liver and overcome the immune suppression caused by mycotoxins. A combination of different strategies can counteract the negative effects of mycotoxins in poultry more completely, especially in cases of multi-mycotoxin contamination. Overall, mycotoxins still impose a great risk for the poultry sector and alternative approaches for the prevention are still being sought by researches around the world. FBA

FOODBUSINESSAFRICA.COM

Watermelon is a summertime staple. But what's hidden behind the sweetness? By Michael Merschel, American Heart Association News

hether they're serving as snacks at a family reunion or props in a late-night comedy act, watermelons and fun just seem to go together. But how does watermelon hold up health-wise?

SMASHINGLY, YOU MIGHT SAY. "I'm definitely impressed by its health benefits," said Tim Allerton, a postdoctoral researcher at Louisiana State

FOODBUSINESSAFRICA.COM

University's Pennington Biomedical Research Center in Baton Rouge. Fruit is always part of a healthy diet. But watermelon's combination of nutrients makes it special, Allerton said. It's a rich source of minerals such as potassium and magnesium. It's also a good source of vitamins C and A (plus beta carotene, which helps produce vitamin A), and it has fair amounts of vitamins B1, B5 and B6. You get all of that for only 46.5 calories per cup. JULY/AUG 2021 | FOOD BUSINESS AFRICA

FOOD NUTRITION & HEALTH: CIRCULAR FOOD ECONOMY

Befitting its name, watermelon is about 92% water, which suggests why ancestral watermelons were carried in Africa's Kalahari Desert as long as 5,000 years ago. This is a treat with a lineage: Modern-looking versions are depicted in ancient Egyptian tombs. Where watermelon really stands out is in its concentration of certain antioxidants, which regulate celldamaging free radicals in the body. "Our body has its own antioxidant system, but it helps to get a boost from our diet," Allerton said. "And watermelon is a good source of those antioxidants." Lycopene, which gives watermelon its reddish color, is one of those antioxidants, along with vitamins C and A. Lycopene also works as an anti-inflammatory and has been linked to lower stroke risk. It is most abundant in

citrulline, which has been a focus of Allerton's research. "Watermelon is pretty unique because not a lot of foods are high in this," he said. In a small 2013 study published in the Journal of Agricultural and Food Chemistry, citrulline in watermelon juice was credited with helping relieve sore muscles in athletes.

LYCOPENE WHICH GIVES WATERMELON ITS REDDISH COLOR WORKS AS AN ANTIINFLAMMATORY AND HAS BEEN LINKED TO LOWER STROKE RISK cooked tomato products, but watermelon's lycopene levels are about 40% higher than raw tomatoes. Watermelon also has glutathione, which Allerton called a "versatile, global antioxidant." And watermelon is high in an amino acid called 68

JULY/AUG 2021 | FOOD BUSINESS AFRICA

Citrulline also is linked to the production of nitric oxide, which is important for the health of blood vessels. Several small studies suggest citrulline in watermelon extract could lower blood pressure, although those effects were seen in people eating the equivalent of more than 3 pounds of watermelon a day for six weeks. FOODBUSINESSAFRICA.COM

CITRULLINE IN WATERMELON JUICE IS LINKED TO PRODUCTION OF NITRIC OXIDE WHICH IS IMPORTANT FOR THE HEALTH OF BLOOD VESSELS That's a lot of watermelon. But aside from the general idea that overindulgence in anything is a bad idea, Allerton said there's no downside to enjoying it. Even though it has natural sugar and a high glycemic index – a measure of how fast sugar enters the bloodstream – it has a low glycemic load. That means its actual effect on blood sugar is small. And it will fill you up faster than, say, a bowl of cookies. All nutrition and science aside, afficionados of the fruit just enjoy the taste. Superfan Mark Twain wrote, "It is the chief of this world's luxuries, king by the grace of God over all the fruits of the earth. When one has tasted it, he knows what the angels eat." Allerton prefers his straight up, but he adds that watermelon juice retains many of the benefits of the whole fruit because so much of the fruit is water already. That makes watermelon work well in smoothies. Or you can turn it into a fruit salsa. Experts agree the secret to finding a ripe one is to look for a creamy yellow spot from where the watermelon sat on the ground. If the spot looks more white than yellow, then the melon may not be fully ripe. Weight also is a sign

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of quality – the heavier the better. But most experts say you can't learn much about a watermelon's ripeness from thumping one. So you can probably leave that to the comedians. FBA

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WWW.AFMASS.COM The Foods of the World Expo is the country and specialty pavilion with imported food, beverage & milled products from around the World The Food of the World Expo section will showcase a broad range of food products from out of Africa to a local, regional and international audience. These products include grains, flours; fruits and vegetables, nuts, and spices; milk products; meat, poultry and fish products; beverages, coffee and tea; chocolates, confectionery and snacks; bakery products etc.

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PACKAGING: MEAT

Convenience, sustainability, safety and quality drive trends in meat packaging

By Paul Ongeto

mong commercial foods, meat is one of the most perishable. Many factors including bacterial growth, enzymatic activity and oxidation processes can influence its shelf-life. The main purpose of meat packaging has therefore been to guarantee high standards while maintaining the required characteristics for as long as possible. Consumer demand for convenience in addition to concerns around safety and environmental impact of packaging has however created a new impetus for new product development and innovation. From touch-free packaging and recyclable shrink bags to interactive labelling and QR codes, the meat packaging is awash with new innovations. In this edition, we bring you some of the most innovative meat packaging trends with potential to shape the future 70

JULY/AUG 2021 | FOOD BUSINESS AFRICA

of meat packaging. PACKAGING FOR FRUSTRATION-FREE COOKING Conventional packaging often requires consumers to portion meat products after purchase into bags or containers. This however takes time and in the case of raw meat may be actively distasteful to consumers. To address this challenge, packaging meats in singleportion sizes, or cook-in packaging is emerging as a popular trend. Where it’s inappropriate or undesirable to reduce package size, pouches with a zipper seal or a tray lidded with resealable films are used instead. Consumers remove meat whenever needed, in any quantity, then simply close the package. One of the pioneers in this trend was UK supermarket Sainsbury, which launched straight-to-pan plastic FOODBUSINESSAFRICA.COM

pouches, allowing customers to cook raw meats without directly touching the product. “Customers, particularly younger ones, are quite scared of touching raw meat," Katherine Hall, Product Development Manager for Meat, Fish and Poultry at Sainsbury's, says. "These bags allow people, especially those who are time-poor, to just ‘rip and tip’ the meat straight into the frying pan without touching it.” By minimizing physical contact, the touch-free packaging also minimizes chances of food poisoning, a major concern for most millennials. In response to this demand for convenience, Swiss-based flexible packaging manufacturer Amcor has rolled out BePack™, a flexible packaging with an easy-to-open and reclose feature that helps retain superior flavour, freshness, and quality in convenient formats. ALTERNATIVES TO MODIFIED ATMOSPHERE PACKAGING Shelf life and presentation of the meat itself both have a strong impact on the “buy / do not buy” decision in store, and also on the “consume / do not consume” choice at home. For a long time, meat packagers used modified atmospheric packaging (MAP) to limit the potential for oxidation and microbial growth while at the same time preserving the bright red color, or “bloom,” that consumers prefer. MAP however has its limitations. When oxygen is completely replaced, meat does not achieve the desired red colour, and when maintained in a ratio with carbon dioxide, oxidation of beef lipids and proteins occurs, with adverse effects on flavor and texture. Therefore, although UNLIKE MAP, VSP REMOVES ALL AMBIENT AIR AROUND THE PRODUCT AND DOES NOT REPLACE IT WITH ANOTHER GAS OR AIR MIXTURE, SIGNIFICANTLY REDUCING OR ELIMINATING THE EXPOSURE OF PRODUCTS TO OXYGEN. MAP extended shelf life for fresh meats by up to 4 times when compared to conventional overwrapped foam tray, it was simply not enough. Several solutions have since been developed to replace MAP in meat packaging. Vacuum skin packaging (VSP) is one such technology that is emerging as a potential alternative. Unlike MAP, VSP removes all ambient air around the product and does not replace it with another gas or air mixture, significantly reducing or eliminating the exposure of products to oxygen. With oxygen absent, lipid and protein oxidation become significantly minimized. This extends meat shelf life by 20% when compared to conventional MAP, Accor confirms. VSP also provides a superior display option for red meats, because the film’s tight adherence to the product reduces moisture loss and FOODBUSINESSAFRICA.COM

preserves its attractive appearance in the showcase. Another improvement to MAP is the complete replacement of oxygen with CO2 enriched with 0.4 percent carbon monoxide. The carbon monoxide binds with the meat’s myoglobin to create the rosy hue that is appealing to consumers but does not promote lipid or protein oxidation. Packaging with CO-MAP results in a shelf life superior to conventional high oxygen MAP while still maintaining the desired appearance of meat. This technology has however not been approved in Europe, limiting its widespread use. MORE SUSTAINABLE OPTIONS COME TO MARKET Consumers want to make more responsible and sustainable choices without sacrificing product quality. More than half (54%) take sustainable packaging into consideration when selecting a product, according to Trivium Packaging’s 2021 Global Buying Green Report. Younger consumers — those 44 years and younger — are leading the charge, with 83% reporting that they are willing to pay more for it, compared to 70% of all consumers. The consumer-driven demand for sustainable packaging has led to an explosion of innovation in sustainable packaging. Many of these innovations focus on plastic reduction, with some like GEA’s recently launched Food Tray claiming to give meat packers 80% plastic reductions. Others like Amcor’s Eco-Tite® R and SealPac’s FlatMap have been designed for recyclability. The Eco-Tite, launched in December 2020 was touted as Europe’s first recyclable shrink bag for fresh meat and cheese. It is a timely innovation for meat packers who are also subject to EU regulations that are aiming to ensure 50 percent of all plastic packaging is recycled by 2025 and 55 percent by 2030. As the sustainability trend continues to rage, other manufacturers are shifting their focus to completely JULY/AUG 2021 | FOOD BUSINESS AFRICA

PACKAGING: MEAT

KEY NUMBERS

US$470BN

PROJECTED SUSTAINABLE PACKAGING MARKET VALUE IN 2027

replacing plastics from meat packaging. Finnish woodbased plastics innovator Woodly in collaboration with Wipak, developed a new type of renewable plastic made from wood cellulose. The new packaging has been embraced by food manufacturer HKScan which will reportedly use it to pack selected grilling sausages from mid-2021 in Finland. The wood-based plastic has also been reported to be suitable for fish, cold cuts, cheese and various household applications. Another company in the plastic replacement field is CARAPAC, an Australian start-up which has developed a biodegradable alternative to plastic food packaging. CARAPAC says the new packaging made from the chitin and cellulose contained in crustacean skeletons can keep products fresh for up to 7 days or longer and could be potentially used to replace plastic in meat packaging apart from being an excellent product for fresh produce and

vegetable packaging. With sustainable packaging being in vogue, the market is expected to continue expanding even further. Market research future projects that the sustainable packaging market is projected to post a CAGR of 10.3% from 2021 to 2027 to reach US$470.3 Billion by 2027 from an estimated US$305.31 billion in 2020. We can therefore expect more packaging with sustainability claims to continue flooding the market for the near future.

JULY/AUG 2021 | FOOD BUSINESS AFRICA

SMART PACKAGING GATHERS MOMENTUM Transparency is vital to consumers, and this has only become more important since the outbreak of the coronavirus pandemic. Consumers want to know the story of the product’s origin, steps involved in its manufacturing, logistics and its ingredients. As a result, the use interactive labelling and QR codes on meat packaging has been on the rise. QR codes have for instance opened a new world of possibilities when it comes to the amount of information that consumers can get from packages. By scanning the digital code printed on the packaging, consumers can for instance be able to find out nutritional information, product origin and product certifications. A scan can also provide detailed cooking instructions and recipes, a welcome support as consumers have had to learn to cook more at home in the past year. Apart from QR codes, intelligent packaging is also presenting a new window of possibilities, particularly in tackling food safety issues. In November 2020, researchers from the Nanyang Technological University in Singapore unveiled to the world the e-nose, an artificial olfactory system which reportedly confirms whether meat is fit for consumption faster and more accurately than a best before date. The e-nose consists of two parts: a barcode that changes color over time as decaying meat emits gases and a barcode reader in the form of a smartphone app powered by artificial intelligence (AI). When tested on commercially packaged chicken, fish and beef meat samples, the team found that the AI algorithm predicted the meats’ freshness level with a 98.5 percent accuracy. Professor Chen Xiaodong, co-lead author on the research notes that the e-nose can be easily integrated into packaging materials and yields results in a short time. As technology advances and AI and block-chain technologies become increasingly integrated into food processing, we can only expect proliferation of such technologies to take place at an even quicker pace in the years to come. FBA FOODBUSINESSAFRICA.COM

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Food Business Africa July/August 2021

Articles inside

Convenience, sustainability, safety and quality drive trends in meat packaging

Managing the Mycotoxins Challenge in Poultry

Pandemic stimulates appetite for functional beverages as it stirs innovations and new product developments

Ice Cream: Scoops of delight unravelling tonnes of treats