The Algerian industry is increasing developing thanks to public development programmes in the food industry sector.
These programmes enable the creation of national companies in the cereal, milk, water and beverage areas but also over the past few years, in sugar, oils and fats, conserves and meat.
Algeria's primary aim is to give value to local food processing and ensure that production continues to develop in sectors which up until now have been loss-making.
The development of the Algerian market and demand in the country remain buoyant due to demographic growth and greater purchasing power in the country.
While Algerian industry can yet be further improved and perfected - with considerable margin for improvement in the equipment and technology used - the country nevertheless has significant local production potential:
In the cereal industry:
Algeria is the world's largest consumer of cereals. The production of durum wheat covers between 60 and 70% of the needs of Algerian Industry. The Algerian cereal industry is highly focussed on the production of flour and semolina.
In the dairy products industry:
- Algeria is the leading consumer of milk in North Africa: 115 litres/ capita/ year in 2016.
- A milk market estimated at 5 billion litres per year.
- Main products of the dairy industry:
- Pasteurised milk in bags: 1,812 billion tonnes per year.
- UHT milk (in cartons or in bottles): 300 million tonnes per year.
- Instant powdered milk: 30,000 tonnes per year.
- Cheese: a fast-growing market: 85,000 tonnes per year.
Requirements for equipment in the country (transport, storage, refrigeration equipment, packing, etc.) are increasing in the cow’s milk processing sector, opening major opportunities for new market entrants.
- Yoghurts and desserts: 428,000 tonnes per year.
- Soured and fermented milk: 300,000 tonnes per year.
- Ice cream: 110,000 tonnes per year.
In the private sector, major investments are devoted in addition to “ultra-fresh” segments, enabling Algerian consumption to grow.
In the Beverage Industry:
This market grew by 21% (by volume) for non-alcoholic drinks and 34% for alcoholic drinks.
This industry is divided up between APAB (associations holding 85% of the market) and small operators.
- Non-alcoholic beverages and cold drinks: 110 litres / capita / year. This market encompasses bottled water (with forecast annual growth of 2.9% by volume and 3.7% by value until 2021), sparkling drinks (with a turnover in 2016 of €818 million and consumption of 1,014 million litres), juices (with sustainable growth and market value of €576 million with consumption of 877 million litres in 2016) and energy drinks (today, these are sold pretty much everywhere and should grow by more than 44.4% between now and 2021).
- Alcoholic beverages break down into the production of beer (5 litres/ capita / year; in the past few years alcohol free beer has started to emerge) and the production of wine (1.5 litres / capita / year). With regard to wine, production is essentially local (500 hl per year). In 2015, 1.91 million hl of alcohol was sold.
In the Sugar Industry:
80% of the sugar industry is held by the company Cevital (soft sugar). Today, sugar consumption stands at 1.3 million tonnes per year. The future needs of the country are likely to be approximately 2 million tonnes per year. Through the creation of the Oran sugar refinery the national requirement in terms of refined sugar will be of approximately 2.5 million tonnes per year.
In the Fruit and Vegetable Industry:
- The future of the fruit and vegetable sector is in the hands of major producers. The “protection” of imports does not work in favour of small local producers.
- Despite the development of the fruit and vegetable sector, this industry is considerable need of new equipment, new technology transfer and knowledge transfer, and particularly training in Algeria.
And also in other sectors:
- Oils and other fats:
- Seed oils: 700,000 tonnes of production.
- Olive oil: 69,000 tonnes of production.
Algeria would mainly like to focus on production of olive oil.
- Meat and fish:
- A significant increase has been observed in livestock production since 2016 (production of red meat of approximately 0.54 million tonnes and white meat of approximately 0.52 million tonnes). The meat market is today dependent on essentially local production; in addition, in April 2017 a ban came into force on the import of frozen meat.
- In terms of fish production, Algeria mainly relies on imports. This is due to many factories closing down (due to lack of resources).
- In the prepared meal market (conserved at room temperature), retail sales have significantly increased (by 14% in 2016). The market for other types of prepared meals (chilled, frozen or dehydrated) is developing at a slower rate, partly due to the ban on the import of frozen meats.
- Prepared meals:
This sector experienced high-growth of 11% in 2016, reaching €2.08 million euros in turnover. The range of prepared meals generating the most sales remains that of “ready-made salads”.
- Grocery products:
This sector brings together the production of vinegar (low alcohol content), red sauces (tomatoes, harissa), mayonnaises, stock cubes, sweet and savoury snacks, biscuits and crackers, etc. Since 2017, these productions have been governed by the signature of a protocol aiming to arrange agreements on sales, production and the creation of factories.
With regard to the production of coffee, chocolate and dried fruit and vegetables, this remains dependent on the import of raw materials into the country.
- Cold chain:
This industry is not mastered in all sectors. The Algerian government thus wishes to achieve improvements in several areas: the use of new efficient technology, the implementation of temperature tracking (transport), the hygiene of staff, premises and equipment, and product storage methods and organisation.
By BUSINESS FRANCE
Market analysis and potential report - "Le marché des Industries Agroalimentaires en Algérie" - published in June 2017.
Authors: Bureau Business France,
Journalist: Sabrina BENBOUALI.