Datetime: 2022-08-28 12:24:12 Visit: 0
Affordability is essential
The majority of African consumers prioritize affordability over health. Affordability is essential in their choice of oil. Palm oil is the most commonly used oil in African countries because of its widespread availability and low cost. It is significantly cheaper than refined oils.
Emphasis on healthy options in developed nations
On the other hand, developed markets such as South Africa give more importance to healthy options. The Banting diet, which promotes the consumption of good fats, has led to the rising popularity of "healthier" olive oil. This trend is resulting in the strong growth of olive oil, despite its relatively high price compared to other products.
Implementation of VAT in the Middle East
As of 1 January 2018, Saudi Arabia and UAE, the two largest markets in the Middle East, have introduced a 5% VAT. In countries where VAT was not previously imposed, this has made consumers more sensitive to pricing. Edible oil companies and retailers are introducing price promotions and bundle offers to attract customers. There is no brand loyalty in this category, and consumers base their choices on affordability. However, upper-income consumers prefer to choose based on health benefits, such as organic olive oil.
Locally produced packaged oil dominates
In Africa, local companies dominate the packaged oil market. They have an advantage due to their proximity to the market and their ability to quickly respond to consumer demand for competitive prices and availability. Additionally, they are regulated by the government and are not subject to high import taxes.
Unpackaged oil is still popular
Despite recession in many countries, edible oils, which are necessary for cooking, are less affected. However, unpackaged oil remains the most popular form of oil purchased. This limits the growth of branded, packaged products, as unpackaged oil is widely available and more affordable due to the small quantities that can be purchased.
