Chocolate value sales on the continent were estimated at $7.2bn in 2016 and are projected to rise at a compound annual growth rate (CAGR) of +1.9% up to 2021.
Chocolate number two
Chocolate is the second topselling confectionery category in Africa behind sugar confectionery. It accounts for roughly 26% of Africa’s total $27.4bn total confectionery market in 2016 (chocolate, sugar confectionery, gum and biscuits).
Over the same period the global chocolate confectionery market is forecast for a +1.5% CAGR.
Kenya and Nigeria the growth drivers
FoodTrending predicts Kenya and Nigeria will be the fastest growing African chocolate markets with a +3.2% CAGR forecast in both markets to 2021.
South Africa - the continent’s largest chocolate market with $1.6bn in 2016 value sales – is expected to grow below the global average at a CAGR of just +1.3%.
Steve Rice, managing director of FoodTrending, told ConfectioneryNews of the African continent: “This is still a small market with plenty of room for development, but further development will be ‘steady’ rather than ‘dramatic’.
“The overall confectionery market in Africa has failed to realize some of the optimistic forecasts that were being made 5-10 years ago,” he said, due to low disposable income and the strength of the US dollar marking imports more expensive.
Low per capita consumption
Annual per capita chocolate consumption in Africa remains low at around 0.5 kg, compared to 4-12 kg per capita in some Western markets such as the UK, US and Switzerland.
Rice – who previously worked at Kraft Foods (Mondelēz’s predecessor firm) and Nestlé – said: “Sales potential is depressed due to high ambient temperatures and lack of disposable income.”
He said chocolate is traditionally brought back to Africa by relatives visiting other countries.
“Locally-produced products had generally been of poor quality and major global players, such as Mars and Nestlé, originally imported product as local supplies were ‘unreliable’.
“To some extent, this is now changing with major brands starting to be manufactured in situ with local manufacturers also benefiting from these developments,” he said.
Mars and Mondelēz dominate
Mars and Mondelēz dominate the overall African confectionery market, followed by Nestlé, according to FoodTrending.
But local brands also compete such as Kenafric Industries in Kenya, which manufactures gum, chocolate and sugar confectionery, with brands such as Be-Nutz, Razzle and Maxie.
Rice said he expects Africa’s chocolate volumes sales to grow around +2.3% year-on-year, but anticpates value sales will be depressed in the next five years as competition and local supplies increase.