For the five weeks to April 3, beer sales pushed soft drinks out of the top-selling position. Cigarettes are the third-largest product category, with sales growing by about 60% over the past 12 months, according to Nielsen’s data on grocery purchases in the retail sector.
For these figures, Nielsen analyses data from more than 10 000 branded shops (such as supermarkets and shops at petrol stations) and almost 143 000 independent shops (spaza shops, for example). This represents more than 80% of all grocery purchases at South African retailers.
Ged Nooy, managing director of Nielsen SA, says that the ban on sales of alcohol and tobacco products during strict Covid-19 lockdowns in 2020 and last year contributed to the strong growth in these sales from a low base.
Serena Ramiah-Chetty, senior brand manager: innovation at Heineken SA, says the beer market has grown by double digits in the past two years. This trend is expected to continue this year.
Non-alcoholic beer remains a small subcategory of the local market. During the Covid-19 lockdowns, sales grew, but the segment began to shrink after the ban on alcohol sales was lifted, she says.
BusinessWire, a Berkshire Hathaway company, estimates that the South African beer market (calculated on the basis of retail prices) will grow by about 5% a year to $12 billion (R190 billion) by 2024.
The price of cooking oil, which is one of the top 20 products that Nielsen measures, has skyrocketed recently. According to Nooy, this is largely due to Indonesia’s decision to halt palm oil exports to stem local shortages. The prices of soya beans, European rapeseed and even canola oil are also at historic highs.
“Because vegetable oils are an ingredient of various products, from prepared meals to personal care items, rising prices will have a further negative effect.”