THE GROWTH OF THE NIGERIA’S PASTA INDUSTRY
There are various aspects which position pasta a staple food in Nigeria, since its introduction to the market, it’s enjoyed by generations.
“Talking about everybody liking it, I think this is the best time in the noodles product history in Nigeria. Noodles were introduced to Nigeria back in the early nineties by a very courageous company. I am sure they just picked up Nigeria on the map as the biggest country in Africa. They took the risk at a very difficult time in Nigeria and it has paid off for them. Indomie owned by Dufil has become the synonym for noodles in Nigeria because of the early bet they took in Nigeria,” Jimi Ogbobine, Senior Analyst Agusto & Co told CNBC Africa.
Dufil owned 70 per cent of the market in Nigeria at the time but the market has since grown.
“That’s because the [children] who were bred on noodles in the nineties, many of them have become parents. They are [raising] there children on noodles, so we now have a second generation and third generation consumers of noodles. The outlook is very good for them with over 70 per cent of market share slightly depending on the kind of estimate you use,” he said.
The industry has seen a lot of growth over the years with also other companies like Honeywell entering the market which also saw a higher percentage growth Noodles than traditional pasta.
According to Ogbobine, “Honeywell, which was a later entrant into the market riding on the back of its ‘Ban Ban La La’ advert, has grown to about 5 per cent. The demographics seems to favour them. Revenue size is about 90 billion naira in noodles which we think will grow to about a 100 billion this year and we have passed that.”
There are also other factors that have contributed to the growth. Factors like the governments discouraging the importation of food to increase job creation by deepening backward linkages.
“Flour Mills of Nigeria is controlling about 54 per cent in the pasta segment, Dangote about 27 per cent. Other things that have driven growth apart from the demographics and food changing culture are principally the law for backward linkages. The government is trying to deepen backward linkages to create more jobs, so the government is discouraging food importation as much as possible. Nigeria has an annual spend of about four billion dollars on wheat which is the major ingredient for pasta and noodles.”