Africa’s food market is growing faster than many people realise. With the right investment, it is possible to tap into new markets that have not been accessible before. There are now almost two hundred million consumers in sub Saharan African countries who can afford to eat more well-rounded meals and at reasonable prices. However, a massive amount of new commodities have not yet been traded between major global trade partners. The best way to gain access to these markets is through the African commodity trade.
African food markets offer a wide range of opportunities to traders and consumers. The west africa food market has experienced explosive growth over the past decade. This growth has led to the entry of many new players in the agricultural export market. Most importantly, it has also resulted in increased levels of competition among traders. The impact of the growth has made it essential for African farmers to develop their strategies to keep abreast of the competition.
A critical aspect of any business in west Africa is to diversify its business model to remain successful. In this case, it is important to explore all possible avenues to increase the exposure of the firm to different markets. A comprehensive approach that combines traditional farming with off-farm processing is a winning strategy. A successful firm will be one that develops a comprehensive marketing plan based on its strategic partnerships and develops its own niche in the food market.
For example, one company that is making inroads in west africa is Ayodeji, which is based in Nigeria and is one of the biggest providers of premium grades of sugar. The company is also exploring opportunities in the procurement of raw materials, refining and manufacturing pharmaceuticals and other industrial chemicals. Ayodeji has signed several strategic partnerships with international commodity trading companies to help them expand their presence in the region.
Ayodeji’s Managing Director, Mr. Idiagdon Ekechi, stated that, “Ayodeji will expand our footprint in the area by helping our smallholder farmers access the markets in western Africa. African consumers will be able to benefit from the high quality, low cost and timely delivery of our products.” Another company that is making inroads in west Africa is Osiris Nutrients, which has signed a deal with the Nigerian government to export 400 metric tons of black pepper in the next four years. The company plans to invest $500 million in the venture. The investment is expected to generate about 40 direct jobs for nigeria farmers over the next four years.
As illustrated, food entrepreneurs are stepping into the new markets of west Africa at a much faster pace. This represents a huge opportunity for the companies involved in the business. The best part about these ventures is that most companies are developing a niche strategy. That means that they are taking a look at the characteristics of the market to determine what products to offer. The companies will continue to find new markets as long as demand exists for the commodity that is being traded.