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Opportunities to step up manufacturing capacity

Countries across sub-Saharan Africa are actively seeking to reduce their dependence on food imports. Growing local manufacturing will mean additional demand for food and beverage processing machinery and equipment across the continent.

AFRICAN FOOD IMPORTS, expected to top $110 billion annually by 2025, are increasingly unsustainable. Bolstering local production capacity is regarded as key to economic growth as the continent’s population booms and rapid urbanisation takes place. The growth of urban middleclass consumers in Africa could lead to $645 billion in growth in consumer spending between 2015 and 2025 - $167 billion in food and beverages, McKinsey reports.

Across sub-Saharan Africa, we see a trend for governments to move away from food imports, and incentivise improved agriculture, agro-processing and food and beverage manufacturing locally. Cameroon’s Ministry of Commerce recently announced plans to suspend the importation of about 50 products, Angola’s Produção Nacional, Diversificação das Exportações e Substituição das Importações (Programme to Enhance Production, Diversify Exports and Substitute Imports; PRODESI) seeks to replace imports with locally manufactured goods and diversify exports, while Nigeria clamped down on funding for food imports in 2019.

“We expect to see moves along the same lines in countries like Mozambique and Tanzania, so there will be opportunities to supply manufacturing machinery and equipment into these markets, as entrepreneurs start entering the manufacturing arena,” Liz Whitehouse, MD of African market researchers Africa House explains.

South Africa, despite its sophisticated food manufacturing sector and strong consumer market, is currently facing slow domestic economic growth. Manufacturers are now challenged in controlling production costs while still meeting consumer demand, which has remained steady. This could see more investment in advanced technologies to boost efficiencies and help manufacturers control costs.

South African food manufacturers are also looking to the export market, meaning they will likely focus on technologies that support product consistency and quality to meet global food standards.

The South African government is prioritising the sector: food and beverages is the biggest component of South Africa's manufacturing industry, with the government actively encouraging further development of agriculture and the agro-processing sector. South Africa’s Department of Trade and Industry has in the last three years funded the food-processing sector to the value of R736 million in incentives, while its Enterprise Investment Programme (EIP) incentive has disbursed funds of R636 million and facilitated investments of R3.7 billion in the sector, and a Co-operative Incentive Scheme has disbursed more than R100 million in support of agro-processing. In addition, two major projects in foodprocessing benefited from tax incentives to the value of R1.1 billion.

IMPORTED MACHINERY, EQUIPMENT NEEDED FOR GROWTH

While efforts are underway to stimulate agro-processing and manufacturing capacity, most of the necessary manufacturing machinery and equipment is not produced locally.

Whitehouse notes that most machinery and equipment for the manufacture of food and drink in South

Africa is imported.

As South Africa is a key gateway into the rest of the region, this equipment is also sold out of South

Africa into sub-Saharan Africa. “Companies in southern Africa would look to

South Africa as their source of foreign machines and equipment, and demand is likely to pick up as their manufacturing capacity grows,” she says. “In 2019, South Africa’s imports of machinery for the industrial preparation or manufacture Food & drink technology (FDT)

Africa, will be held from July 13-15, 2021, at Gallagher Convention Centre in Johannesburg. DID YOU KNOW?

Workers in a food processing facility

of food or drink amounted to R1.8 billion. Importantly this reflects a 64% increase in value over a five-year period from 2015. Exports from South Africa of machinery in this tariff heading to SADC amounted to R407 million in 2019.”

SA GATEWAY TO SUB-SAHARAN AFRICA

South Africa remains a strategic gateway between sub-Saharan Africa and the rest of the world, which is why delegates from across the continent converge in South Africa at international exhibitions and conferences such as food & drink technology (FDT) Africa. FDT Africa 2019, which was co-located with IFAT Africa and analytica Lab Africa, attracted over 8 000 visitors from across the continent to assess products and services from 65 exhibitors from 13 countries and view country pavilions hosted by China, India and Germany.

“There is a keen mutual interest in boosting trade between global and southern African businesses. food & drink technology (fdt) Africa, which covers the entire food and drink value chain including processing, packaging, filling and logistics, is proving to be a key networking opportunity and product showcase for African decision makers,” Whitehouse, concludes. •

A creative first for Egypt

Symrise inaugurated its creative centre in Egypt in November 2019. The subsidiary, located on the outskirts of Cairo, comprises modern development and application laboratories for the beverages, confectionery, dairy, culinary and snacks industries.

THE AIM OF the new facility is to strengthen its reach in the AME region and its collaboration with strategic customers.

Symrise equipped its innovative development and application laboratories with state-of-the-art technology. Within the creative centre, employees can now develop customised product solutions and applications and adapt existing products for the market. The facility offers several advantages that will speak to the modern consumer, while market analysis and quality assurance procedures guarantee authentic and relevant products for customers and consumers in the region.

“By investing in the new facility, our strong team of food technologists and flavourists can make a significant contribution to the growth in the region in the future,” says Dirk Bennwitz, president flavour EAME at Symrise. “Our location in Cairo offers us proximity to customers and markets in Africa and the Middle East. In future, we will be able to better serve demand in the region and optimally align our business with our customers, thus contributing to the company’s growth.”

CUSTOMERS BENEFIT FROM TAILORMADE DEVELOPMENTS

The Symrise team will now have access to all the technologies and innovations available in the group. This will make it easier to meet customer demand. In addition, customers benefit from the knowledge of the region and the increased use of local raw materials. This helps to meet the diverse wishes of consumers. Another advantage is that Symrise can work with its customers in a time- and cost-efficient manner.

“We use a wide range of manufacturing technologies in Egypt to supply all of Africa and the Middle East,” says Ibrahim Wagdy, responsible managing director of Symrise in Egypt. “We are now expanding these capacities with our modernised site thereby increasing the attractiveness for our customers in the region.”

Egypt is an important location for Symrise. The country's location in the AME region makes it easy to exchange

ABOUT SYMRISE

The company is a global supplier of flavours and fragrances, food, nutrition and cosmetic ingredients. Clients include manufacturers of perfumes, cosmetics, food and beverages, pharmaceuticals and producers of nutritional supplements and pet food. Headquartered in Germany, Symrise is represented by more than 100 sites in Europe, Africa, the Middle East, Asia, the US and Latin America and works with its clients to develop new ideas and market-ready concepts for products that form an indispensable part of everyday life.

Symrise inaugurated a modern development and application laboratory for taste solutions in Egypt

information with customers from Africa and the Middle East. The country’s strong industrial and agricultural infrastructure provides valuable advantages for the production and development of flavours for the local market. •

FAST FACT: Dirk Bennwitz, president flavour EAME at Symrise, officially opened the new facility and is proud that it meets all of the company's global development and technology standards.

Symrise – www.symrise.com