Market Analysis for Agro Products
Market Overview
Beverages
There are not many manufacturers of alcoholic drinks in Malawi. The major players are
Carlsberg Breweries and Malawi Distilleries. The retail stores include Peoples, Chipiku and
Sana.
List of Supplying market for HS Code 2208 imported by Malawi
5000
4500
USD Thousand
4000
World
3500
3000
South Africa
2500
Swaziland
2000
India
1500
United Arab Emirates
1000
Namibia
500
0
2010
2011
2012
Source: Trademap
The above chart shows Malawi’s world import market for beverages (HS code 2208) has a value
of USD 4.4 million in 2012 with an increase of 47% over the previous year. South Africa is
Malawi’s largest import market accounting for 38.3% of its exports of beverages (HS code
2208). Swaziland’s exports to Malawi have increased by 81% in 2012. Swaziland is the second
leading sourcing market for Malawi, representing a share of 28.4% in Malawi’s total imports.
Source: Trademap
Wine: Malawi experienced a decrease in total import of wine (HS 2204) by 9.6% in 2012 (world
exports increased by 4% in 2012).
Beer: On the other hand, Beer (HS 2203) experienced a growth of 4% in world exports while
Malawi’s import rose by 21.15%.
Spirits: Malawi’s imports for spirits and liqueurs (HS 2208) amounted to USD 392,000 in 2012,
representing an annual increase of 3.7%.
Ethyl Alcohol: From the above chart, we can also deduce that Malawi’s import for ethyl alcohol
& other spirits increased by13.39%.
Chipiku Stores
Chipiku is one of the biggest well-established retail stores in Malawi and is reputed for its
extensive agri-business activities. The General Manager, Mr. Peter Kemp, was approached with
a view to explore the opportunities for agro products as follows:
1) Beer
According to Mr. Kemp, importation of beer is mainly done from South Africa. He claimed that
Malawians tend to favour beers in glass bottles rather than cans as it tastes differently. Mr. Kemp
mentioned that the most common beer in bars in Malawi is Carlsberg. He stated that Mauritius
will face fierce competition from well-established South African brands. While the packaging
was found to be appropriate, the prices unfortunately were rated to be too expensive to penetrate
the Malawian market.
2) Wine
Mr Kemp stated that the samples from Mauritius packaging was not attractive, particularly the
labels. In evaluating the prices, he claimed that it is affordable. It is important to note that similar
type of wine is being sourced from South Africa for the price of $1.50 FOB. He further
mentioned that these wines would be appropriate for the bottom end segment. Mr. Kemp claimed
that the excise duty on alcohol drinks is 95% and Vat is 16%.
3) Rum
Rum is consumed only by a small segment of the population, the demand is not sufficient to
warrant the need to import rum from Mauritius.
4) Spirits
Commenting on the sample presented Mr Kemp said that the packaging looks good and the
prices seems to be fair as well. He mentioned that he may eventually be interested in importing
the product on a trial basis.
Market Overview-Confectionary products
There is not much local production of sweets and candies in Malawi. The market’s leading
domestic supplier is Universal Industries. The confectionary industry in Malawi is dominated by
few large players namely, Chipiku Stores, Peoples and Sana. The below table shows that in
2012, Malawi’s imports for confectionary (HS Code 1704) amounted to USD 5 million with an
increase in value of 13% p.a. over the 2008 to 2012 period. One of the reasons to such growth
can be attributed to the growing young population, with 54% of the total population under the
age of 18 (Source: ICEIDA, Malawi country strategy paper 2012-2016). Zambia is the leading
supplier for this product, accounting for 39.3% in Malawi’s share of imports, followed by Kenya
and South Africa, with 34.6 % and 17.5% respectively.
Exporters
Trade Indicators
Share in
Malawi's
imports (%)
World
Imported
value 2012
(USD
thousand)
6414
100
Imported
growth in value
between 20082012 (%, p.a.)
13
Zambia
2520
39.3
62
Kenya
2222
34.6
15
South Africa
1125
17.5
2
India
192
3
4
Zimbabwe
151
2.4
-36
Source: Trademap
As mentioned earlier, demographic changes are a principal cause of shifting consumption
patterns of confectionary in Malawi. Since youth are traditionally the influencers and main
consumers when it comes to confectionary purchases, the young population provides a
significant opportunity for Mauritian suppliers to reach new customers. While Mauritius is
currently not exporting confectionary, we believe that there is a potential for Mauritius to
penetrate the market and should penetrate the market with competitive price and supply quality
products. Further development of sugar-free products will also be a key driver in the coming
years. A 2009 World Health Organisation survey shows that Malawi has a 5.6% prevalence rate
of diabetes, with more cases arising on a daily basis.
Chipiku Stores
The General Manager, Mr Peter Kemp was approached in order to gauge his interest for sweets
& candies and chewing gum. Upon presentation of the types of confectionary commercialised
by Mauritius, Mr. Kemp was interested to trade with Mauritius. Mr Kemp said that he is
currently importing from Indonesia, South Africa and Zambia. Commenting on the samples, Mr
Kemp found the packaging to be nice. However, he claimed that the size of the lollypop is rather
small but price is competitive.
Peoples Trading Centre Ltd
People’s Trading Centre Ltd is wholly owned by Press Corporation Limited. It is the largest and
wide spread retail chain in Malawi with over 80 retail shops spread across the country. The
company sells and distributes fast moving consumer goods both in retail and wholesale. 80% of
the goods come from local production while the remaining 20% is mainly imported from South
Africa and Kenya. The company operates under the following 4 brands:

People’s Metro
These are large hybrid wholesale stores, that cater for retail as well as wholesale
customers, offering discounted prices for bulk purchases on a wide range of products.

People’s Supa Save
These stores range from supermarkets to urban convenience stores, offering in-store
butcheries and bakeries as well as fast foods. The stores carry a wide range of local and
imported groceries.

People’s Cash and Carry
These are hybrid wholesale stores situated predominantly in smaller rural towns where
they service both the retail and wholesale needs of the local community

People’s Express
These are smaller convenience stores with a smaller range of products.
The Deputy Merchandise Manager, Mr Dings Mpota and the Merchandise Manager, Mr. Kelvin
Chiwaya were interviewed in order to assess the potential of confectionary. Mr Mpota stated
that sweets and candies are mainly targeted for the mass market. Therefore, to be able to
penetrate the market, Mauritian companies will have to play on prices to compete with the local
“universal brand” which is very popular in Malawi. While Mr Mpota was interested in the
samples presented by EM, he maintained that due to shortage of currency People’s is unable to
import currently. Nevertheless, Mr. Mpota claimed that once the situation is improved, he would
be interested to receive quotes from Mauritian suppliers as he has plans to increase its volume of
imports.
Market Overview – Pasta and Noodles
Malawi currently does not have any manufacturers of pasta and noodles. In 2012, Malawi’s
imports for this product category stood at USD 562,000. With a share of 57.5% of total Malawi’s
import of pasta and noodles, South Africa is the leading supplier market, followed by
Mozambique (10.9%), Egypt (8%), China (7.7%) and Turkey (6.6%). From the below table, it
can clearly be inferred that Turkey is the most competitive supplier even when compared to
South Africa. This is undoubtedly due to Turkey’s being one of the top producers of pasta in the
world. The production capacity of the country is more than 1,000,000 tons per year. Hence with
economies of scale Turkey is able to command a lower price. China and India are currently not
competitive when compared to Turkey and Egypt. However, this can be attributed to the cost of
logistics.
Exporters
Trade Indicators
Share in
Malawi's
imports (%)
Imported
quantity 2012
(Tons)
Unit value
(USD/unit)
World
Imported
value 2012
(USD
thousand)
562
100
388
1,448
South Africa
323
57.5
141
2,291
Mozambique
61
10.9
38
1,605
Egypt
45
8
54
833
China
43
7.7
20
2,150
Turkey
37
6.6
54
685
India
18
3.2
6
3,000
Source: Trademap
Key players in this sector are dominated by South African companies in Malawi. The main
brands in the Malawian market are Heinz, Fati’s and Moni’s, Indomie, Pasta Polana and Maggie.
The retail price and wholesaler price for these products are as follows:
COMPANY
Heinz Foods
Tiger Consumer
Brands
Compania
Industria Da
Mtola
PT Indo Food
Tiger Consumer
Brands
Compania
Industria Da
Mtola
PRODUCT
Heinz 2minute
Noodles
Mushroom
Flavour 75g
heinz 2minute
noodles Chicken
Flavour 75g
Fatti's & Moni's
Macaroni 500g
Polana
Macaroni 400g
Pop Mie Instant
Cup Noodles
Chicken Curry
60g
Fatti's & Moni' s
Spaghetti 500g
Polana spaghetti
400g
Wholesaler
Price USD
0.65
Retail Price USD
Mark up
Margin
0.71
8.93
8
0.65
0.71
8.93
8
1.17
1.29
9.90
9
0.93
1.05
12.50
11
0.37
0.41
9.38
9
1.17
1.29
9.90
9
0.93
1.05
12.50
11
Source: People’s Supermarkets
The price margin for the above products ranges between 8 -11%. For instance, Fati’s & Moni’s
macaroni of 500g wholesaler price costs USD 1.17 while the retail price is at USD 1.29.
Brand Positioning of Pasta and Noodles
The demand for Instant noodles and spaghetti are experiencing a growth. However, Mauritian
suppliers will face tough competition with well-established brands. To penetrate the Malawian
market, Mauritian companies will first need to create brand awareness and position itself as a
reliable supplier in terms of good quality at affordable prices. Indomie clearly practices low
pricing. On the other hand Fatti’s and Moni’s brand are famous for their fine quality pasta. Heinz
Instant noodle has positioned itself in the medium to upper market segment.
Chipiku Stores
Mr Kemp rated the noodles as good quality. He even mentioned that although the price is
slightly expensive, he may still consider importing since it is getting more and more popular
among the Malawian consumers and it is expected to continue increasing in the future.
He pointed out that pasta is a heavy product with low value. He further mentioned that Malawian
consumers will pay more for Italian pasta. He also informed EM officers that Spaghetti is more
in demand in Malawi.
People’s Trading Centre Ltd
In regards to Noodles, the Deputy Merchandise Manager of People’s mentioned that there are no
manufacturers of noodles in Malawi. Interestingly, he believes that there is an opportunity for
Mauritian suppliers to tap provided the price and specifications are appropriate. He proposed that
Mauritian companies first need to identify a distributor who will be able to distribute the
products to key retailers in Malawi.
He underlines the fact that Mauritian companies should ensure that the packaging should have all
details on ingredients and other information in English.
.