Page 1 - Mozambique Food and Drink Report Q4 2012 Published: August 2012

No. of Pages: 45

Price: US $ 1175

Mozambique has quietly been establishing itself as one of Sub-Saharan Africa’s most promising economies over the past few years. Given the strong growth expected over the next few years, with average real GDP growth of 7.7% forecast between 2012 and 2016 by our Africa team, we believe that the country’s food and drink sector is likely to attract quite a bit of investment as headline growth in the economy drives up consumer spending power across sectors such as food processing, soft drinks, retailing and beer.

Key Forecasts  Per capita food consumption growth (local currency) in 2012: 9.2%. Compound annual growth rate to 2016: 11.1%.  Beer volume sales growth in 2012: 8.4%. Compound annual growth rate to 2016: 8.5%. Key Trends Organised Retailing: All Southern Africa markets lag regional leader South Africa in terms of the presence of organised grocery retailing. Across the region, formalisation will be a key driver of mass grocery retail sales growth, as more and more shoppers trade up to organised retail channels. This will be true even for the region’s more mature markets; however, we also expect the steady introduction of new store offerings, such as non-food products, to help to support growth. In Mozambique, we estimate that only around 2-3% of grocery retail sales are accounted for by the organised sector and this provides tremendous room for growth. Beverage Sector Growth: We expect to see strong beverage sales growth throughout the region over our forecast period to 2016 and beyond. There is enormous potential in beer and soft drinks, specifically carbonates, at this stage of the region’s development. Throughout the region the beer market is already keenly contested, and this level of competition will lead to significant new investment over our forecast period, driving strong sector growth. At an estimated 9mn litres per annum, Mozambique’s beer consumption levels remain low by regional standards and this provides enormous potential for sales growth. Demographic Appeal: Demographics are a key component of the region’s appeal, given the very low base from which most growth is occurring and the severe income inequalities that still persist. Mozambique’s population dynamics are a plus point for investors. The country’s already attractive 23.9mn-strong population base (as of 2011) will grow to 29.2mn by 2020 and by an enormous 110% over our entire forecast period, to stand at 50.2mn in 2050. Most notable is the age profile of the population; in 2012, 54% of Mozambique’s population is forecast to be younger than 20, and this provides immense long-term growth opportunities for regional investors.

Mozambique Food and Drink Industry Table of Contents BMI Industry View 5 Business Environment 6

Sub-Saharan Africa Food & Drink Ratings 6 Macroeconomic Outlook ... 11 Industry Forecast ... 13 Food, Drink, Mass Grocery Retail 13 Food Consumption ... 13 Drink 22 Mass Grocery Retail 24 Market Overview 26 Southern Africa: A Great Opportunity For Multinationals ... 26 SABMiller’s Sechaba Breweries: SSA’s Most Efficient Beer Company?... 29 Demographic Outlook ... 35 Risk/Reward Ratings Methodology . 39 Weighting .. 40 Table: Weighting.. 40 BMI Food & Drink Industry Glossary ... 41 Food & Drink 41 Mass Grocery Retail . 41 BMI Food & Drink Forecasting & Sourcing . 43 How We Generate Our Industry Forecasts ... 43 Sourcing ... 44 - Mozambique Food and Drink Report Q4 2012  

Mozambique has quietly been establishing itself as one of Sub-Saharan Africa’s most promising economies over the past few years. Given the s...

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